REPORT ON NATIONAL INCOME ACCOUNTS

(Q2 2021)

REPORT ON
NATIONAL INCOME ACCOUNTS
(Q2 2021)

Table 1. Q2 2021 Economic Performance

(percent growth rate year-on-year, at constant 2018 prices)

2020 2021
PARTICULARS
Q1 Q2 S1 Q1 Q2 S1
GROSS DOMESTIC PRODUCT -0.7 -17.0 -9.3 -3.9 11.8 3.7
GROSS NATIONAL INCOME -1.6 -17.6 -10.0 -10.6 6.6 -2.4
Net Primary Income -9.3 -24.4 -16.6 -75.6 -53.8 -66.1
By Industrial Origin
Agriculture, Fishery and Forestry -0.3 1.6 0.6 -1.3 -0.1 -0.7
Industry -2.5 -21.8 -12.6 -4.4 20.8 7.4
of which: Manufacturing -3.3 -21.2 -12.3 0.5 22.3 10.4
Services 0.1 -17.1 -9.1 -4.1 9.6 2.6
By Expenditure
Household Final Consumption Expenditure 0.2 -15.3 -7.7 -4.7 7.2 0.9
Gov’t Final Consumption Expenditure 7.0 21.8 15.5 16.1 -4.9 3.5
Capital Formation -12.1 -51.5 -33.1 -14.8 75.5 20.2
of which: Fixed Capital Formation -2.0 -35.8 -20.2 -18.0 37.4 6.1
Exports -4.4 -33.5 -19.5 -8.8 27.0 6.6
Imports -7.4 -37.3 -22.7 -7.0 37.8 11.6

Source: Philippine Statistics Authority (PSA)

National Economic and Development Authority Page 1 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

A. GDP and GNI

1. After five consecutive quarters of contraction, the Philippine economy grew by

11.8 percent in Q2 2021 from -3.9 percent in Q1 2021. While this may partly be
attributed to base effects coming from a -17.0 percent decline in Q2 2020, it is the
result of a better balance between addressing COVID-19 and the need to restore
jobs and incomes of the people. The community quarantine (CQ) restrictions
imposed this year have taken a more risk-based approach compared to last year
when more sectors were allowed to operate, including public transportation. The
latest growth outturn is better than the 10.6 percent median forecast of private-
sector analysts for the period. 1 On a seasonally adjusted quarter-on-quarter basis,
the economy declined by 1.3 percent. For the first semester (S1) of 2021, real gross
domestic product (GDP) growth accelerated to 3.7 percent.

2. Among major emerging economies in the region that have already released their
Q2 2021 real GDP growth, the Philippines ranked second next to Singapore
(14.3%), and is faster than China (7.9%), Indonesia (7.1%), and Vietnam (6.6%).
Private sector analysts also expect a strong rebound for India (25.0%), Malaysia
(16.4%), and Thailand (6.9%). 2 The positive trend in Q2 growth can be attributed
to the reopening of economies and base effects from the peak of quarantine
restrictions in 2020.

3. Similarly, the country’s gross national income expanded to 6.6 percent in Q2 2021
from -10.6 percent in Q1 2021. Net primary income growth improved to -53.8
percent in Q2 from -75.6 percent in the previous quarter, mainly due to the slower
contraction in the inflow of compensation (-54.5%) and positive growth in the
inflow of property income (18.3%).

4. On the expenditure side, the rebound in Q2 GDP growth was mainly driven by the
uptick in investments and private consumption. Investments in fixed capital
(37.4% in Q2 2021 from -18.0% in Q1 2021) reverted to positive territory fueled

1
https://www.bworldonline.com/phl-likely-exited-recession-in-q2/. Accessed on August 9, 2021
2
Bloomberg consensus forecast for Q2 GDP. Accessed on August 9, 2021.

National Economic and Development Authority Page 2 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

by the significant expansion in construction (33.4% from -25.3%) and durable

equipment (89.2% from -10.3%). With improving consumer confidence,
household spending also picked up (7.2% from -4.7%), offsetting the decline in
government spending (-4.9% from 16.1%). Overall, domestic demand growth
accelerated to 14.7 percent in Q2 from -4.4 percent in Q1. Meanwhile, total exports
posted a double-digit expansion (27.0% from -8.8%), although this was offset by
the stronger growth in imports (37.8% from -7.0%), resulting in a decline in the
growth of net exports (-81.4% from 1.4%).

5. On the production side, almost all sectors bounced back despite the imposition of
the ECQ and MECQ last April and May 2021. This is a clear indication that
managing risks, instead of shutting down large segments of the economy, stands a
far better chance of improving both economic and health outcomes. Significant
improvements were observed in the industry and services sectors as we managed
the COVID-19 risks better and eased quarantine restrictions. For instance, the
strong rebound in manufacturing (22.3% in Q2 from 0.5% in Q1) and construction
(25.7% from -22.6%) subsectors mainly drove the industry sector’s expansion
(20.8% from -4.4%). For services (9.6% from -4.1%), real estate (16.7% from -11.7%),
trade (5.4%from -3.4%), other services (39.4% from -38.7%), and transportation
and storage (23.4% from -19.6%) contributed most to the improvement. Only the
agriculture sector posted a slight contraction (-0.1%) because of the decline in
livestock production.

B. Expenditure (Demand-side)

6. Household final consumption expenditure. Growth in household spending

reverted to positive territory in Q2 2021 at 7.2 percent from -4.7 percent in Q1
2021 and -15.3 percent in Q2 2020. This brings S1 2021 growth to 0.9 percent.
Consumer sentiment slightly improved in Q2 relative to Q1, albeit still negative,
which can be attributed to the easing of CQ restrictions compared to the same
period last year. This is also complemented with the availability of vaccines and

National Economic and Development Authority Page 3 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

provision of financial assistance during the period. 3 Based on the monthly Labor
Force Survey (LFS) conducted by the Philippine Statistics Authority (PSA), net
employment creation from April 2021, when the first round of ECQ this year ended
in National Capital Region (NCR), to June 2021 reached 1.8 million. In particular,
the recent LFS results for June 2021 showed that the economy generated an
additional 2.5 million jobs compared to the pre-pandemic level, and the quality of
employment has improved given the much lower underemployment rate.

Most commodities recorded positive growth in Q2 2021, except alcoholic

beverages and tobacco (-3.4% in Q2 2021 from -11.8% in Q1 2021) which can be
ascribed to the liquor ban imposed during the ECQ in early April 2021. Meanwhile,
spending on transport (20.4% from -28.0%), restaurants and hotels (24.5% from -18.2%),
and recreation and culture (15.7% from -33.5%) registered a double-digit
expansion in Q2 2021. Based on the latest Google Mobility Trend Report, 4 visits
to parks, retail and recreational establishments, and transit stations increased in Q2
2021 relative to the previous quarter. In fact, essential travels to groceries and
pharmacies are higher than pre-pandemic period.

7. Government final consumption expenditure. After 16 quarters of continued

expansion, government expenditure declined to 4.9 percent in Q2 2021 from 16.1
percent in Q1 2021. The decline can be attributed to base effects from the rollout
of the largest-ever emergency subsidies in Q2 2020. For S1 2021, growth in
government spending slowed down to 3.5 percent.

In detail, maintenance and other operating expenses (MOOE) recorded a double-

digit decline of 29.1 percent in Q2 2021 from 39.8 percent increase in Q1. 5 While
spending on social protection measures being implemented under the FY 2021
budget and the Bayanihan II are substantial, these are not comparable to the high
expenditures under Bayanihan I and other COVID-19 responses last year, which
included one-time measures completed in June 2020 such as the Social

3
https://www.bsp.gov.ph/Lists/Consumer percent20Expectation percent20Report/Attachments/20/CES_2qtr2021.pdf.
Accessed on August 9, 2021.
4
https://ourworldindata.org/covid-mobility-trends. Accessed on August 9, 2021
5
Less accounts payables, figures are based on PSA Key Economic Indicators for Q2 2021 and Q1 2021

National Economic and Development Authority Page 4 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

Amelioration Program (SAP) and the Small Business Wage Subsidy (SBWS)
Program. 6 In addition, disbursements for personnel services (PS) decelerated to 4.9
percent in Q2 from 7.8 percent in Q1.

8. Capital formation. The country’s gross capital formation recorded a significant

growth of 75.5 percent in Q2 2021 from -14.8 percent in Q1 2021 and -51.5 percent
in Q2 2020. This brings S1 2021 growth to 20.2 percent. The uptick in total
investments was primarily driven by the double-digit increase in fixed capital
investments (37.4% in Q2 2021 from -18.0% in Q1 2021).

Construction growth accelerated to 33.4 percent in Q2 from -25.3 percent in Q1,

fueled by the increase in construction activities by households (286.3% from -24.0%)
and general government (49.7% from 25.3%). Likewise, investments in durable
equipment (89.2% from -10.3%) soared in Q2, owing to the three-digit growth in
road transport (180.0% from -21.4%), likely due to the continued implementation
of the public utility vehicle modernization program (PUVMP).

In addition, investments in valuables (28.6% from -19.2%) and intellectual

property products (9.2% from 2.6%) also increased, while breeding stock and
orchard development (-2.8% from -3.1%) posted a milder contraction.

9. Net Exports. Growth in net exports significantly dropped to -81.4 percent in Q2

2021 from an expansion of 1.4 percent in Q1, pulling down S1 2021 growth to -28.7
percent. This may be attributed to total imports, which recorded a substantial
recovery outweighing the increase in total exports.

Exports. Total exports growth rebounded to 27.0 percent in Q2 2021 from -8.8
percent in Q1 2021 and -33.5 percent in Q2 2020, resulting in a 6.6 percent
expansion in S1 2021. The faster growth in total exports was mainly driven by
the accelerated growth in the export of services (17.3% in Q2 2021 from -21.1%
in Q1 2021), particularly travel (209.9% from -98.0%) and business services
(13.5% from -3.8%). Based on the data from the Department of Tourism
6
https://www.dbm.gov.ph/wp-content/uploads/DBCC/2021/NG_Disbursements_June percent202021_for_posting.pdf.
Accessed on August 9, 2021.

National Economic and Development Authority Page 5 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

(DOT), growth in visitor arrivals substantially increased to 211.2 percent year-

on-year between April and May 2021, mainly due to base effects of stringent
travel restrictions in Q2 2020.

Merchandise exports accelerated to 35.4 percent in Q2 2021 from 2.8 percent

in Q1 2021, driven largely by the faster growth in exports of electronic products
(41.8% from 11.6%), particularly semiconductors (30.4% from 13.0%) and
electronic data processing (87.5% from 16.1%). The double-digit increase in
semiconductors largely stemmed from the rising demand for medical
electronics, computers, and other digital devices in response to the COVID-19
pandemic. This was evident in the improved sales in top markets such as Hong
Kong (12.6%) and China (22.1%). 7

Imports. Total imports grew by 37.8 percent in Q2 2021, a sharp reversal from
the -7.0 percent contraction in Q1 2021 and -37.3 percent decline in Q2 2020.
This brings S1 2021 growth to 11.6 percent. The uptick in merchandise imports
(46.4% in Q2 from -0.5% in Q1) was largely due to the significant increase in
mineral fuels, lubricants, and related materials (56.0% in Q2 2021 from -23.4%
in Q1 2021), electronic products (56.6% from 16.7%), and transport equipment
(152.0% from -7.2%). Meanwhile, imports of services (-4.4% from -31.3%)
posted a softer decline on the back of milder contraction in travel (-51.4% from
-67.4%) and the rebound in transport (52.4% from -16.2%).

7
Data from PSA

National Economic and Development Authority Page 6 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

C. Production (Supply-side)

10. Agriculture, fishery and forestry. Growth in the agriculture sector remained on
the decline for the second consecutive quarter at -0.1 percent in Q2 2021. This is
a slight improvement from the 1.3 percent contraction in Q1 2021, although
lower than the 1.6 percent expansion recorded in Q2 2020. The second quarter
outturn brings the S1 2021 growth to -0.7 percent.

The weaker contraction in Q2 can be attributed to the improvement in the

production of poultry and egg (2.6% in Q2 2021 from -7.5% in Q1 2021) and
sugarcane including muscovado (32.2% from -4.5%) and the slower decline in
livestock (-19.5% from -23.4%).

The beginning of Q2 2021 saw the implementation of the Integrated National

Swine Production Initiatives for Recovery and Expansion (INSPIRE), the
government’s PHP600-million swine repopulation program. INSPIRE was
implemented through the ‘sentinel’ approach, which refers to monitoring the rate
of African Swine Fever (ASF) occurrence in a number of pigs for a test area. 8
Aside from this, on May 10, 2021, the President declared a state of calamity 9
throughout the country due to the ASF outbreak. This enabled local government
units (LGU) to access resources and implement measures for ASF control and
prevention, such as the establishment and maintenance of ASF biosecurity
checkpoints; procurement of test kits, biologics, and other needed equipment and
materials; and strengthening of diagnostic capability to support early warning
system, surveillance, and monitoring, among others. 10

11. Industry. Growth in the industry sector posted a double-digit rebound at 20.8
percent in Q2 2021 from -4.4 percent in the preceding quarter and -21.8 percent in

8
Department of Agriculture. “DA rolls out P600-M swine repopulation program in ASF “pink” and “yellow” zones.”
https://www.da.gov.ph/da-rolls-out-p600-m-swine-repopulation-program-in-asf-pink-and-yellow-zones (Accessed
August 9, 2021).
9
Official Gazette. Proclamation No. 1134. https://www.officialgazette.gov.ph/downloads/2021/05may/20210510-
PROC-1143-RRD.pdf (Accessed August 9, 2021)
10
Department of Agriculture. “PRRD’s declaration of state of calamity due to ASF will boost biosecurity efforts
https://www.da.gov.ph/prrds-declaration-of-state-of-calamity-due-to-asf-will-boost-biosecurity-efforts. (Accessed
August 9, 2021)

National Economic and Development Authority Page 7 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

Q2 2020. This brings S1 2021 growth to 7.4 percent. Most of the sectors grew
faster relative to Q1, led by manufacturing (22.3% in Q2 2021 from 0.5% in Q1
2021), construction (25.7% from -22.6%), and electricity, steam, water and waste
management (9.8% from 1.1%). In contrast, growth in mining and quarrying (0.8%
from 1.0%) softened but remained positive during the period.

a. Manufacturing. The manufacturing sector showed a significant

improvement in Q2 2021, growing by 22.3 percent from 0.5 percent in Q1
2021 and -21.2 percent in Q2 2020. This brings the sector’s S1 2021
performance to 10.4 percent.

All manufacturing subsectors posted a better growth performance in Q2

compared to the previous quarter such as food products (6.7% from -1.4%),
coke and refined petroleum products (25.3% from -79.6%), chemical and
chemical products (42.3% from 7.4%), computer, electronic and optical
products (47.5% from 17.2%), and other non-metallic mineral products
(87.2% from 8.7%).

The Monthly Integrated Survey of Selected Industries (MISSI) recorded an

average capacity utilization of 66.1 percent in Q2 2021, up from 63.5
percent in Q1 2021 and 55.1 percent in Q2 2020. 11 Similarly, the country’s
Purchasing Managers’ Index (PMI) recovered to 50.8 in June 2021 on the
back of softer declines in output, new orders, employment, and expansion
in pre-production inventories. This signals an expansion after two
consecutive months of posting figures slightly below the 50.0 neutral
threshold. 12

b. Mining and quarrying. The mining and quarrying sector recorded a 0.8
percent expansion in Q2 2021, marginally slower than the 1.0 percent
growth in Q1 2021 but a recovery from the 21.7 percent contraction in Q2

11
https://psa.gov.ph/manufacturing/missi-id/164919. Accessed on August 9, 2021.
12
PMI for April and May 2021 at 49.0 and 49.9, respectively. Data from IHS Markit Philippines Manufacturing PMI:
https://www.markiteconomics.com/Public/Home/
PressRelease/8132d50dabaf4df5b3dc9ecad48be699. Accessed on August 9, 2021.

National Economic and Development Authority Page 8 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

2020. This brings S1 2021 growth to 0.9 percent. While the mining sector
was allowed to operate regardless of CQ classification during the reference
quarter, 13 the slowdown in Q2 can be attributed to the decline in coal
production (-3.2% in Q2 2021 from 41.5% in Q1 2021) and the slower
growth in gold and other precious metal ores (1.7% from 7.9%), and nickel
ores (20.8% from 48.0%). Nonetheless, higher output in stone quarrying and
other mining and quarrying (23.3% from -8.1%) and the slower decline in
production of copper ore (-23.5% from -33.7%) and crude petroleum and
natural gas (-14.3% from -19.1%) kept the sector’s growth in the positive
territory.

c. Electricity, steam, water, and waste management. Growth in the sector

continued to accelerate for the fourth consecutive quarter, posting a 9.8
percent expansion in Q2 2021 from 1.1 percent in Q1 2021 and -6.4 percent
in Q2 2020. This brings S1 2021 growth to 5.6 percent. The uptick in Q2
was driven by the faster growth in electricity (11.4% in Q2 from 1.0% in
Q1) and water supply (5.0% from 1.1%). This outweighed the slowdown in
waste management (2.7% from 7.1%) and decline in steam (-7.0% from
3.0%).

MERALCO recorded higher revenue growth in Q2 driven by energy sales

in its industrial segment, which has returned to its pre-pandemic levels. 14
Similarly, transmission revenue by the National Grid Corporation of the
Philippines increased by 6.3 percent in Q2 2021 from a nil growth in Q1
2021 and -23.1 percent contraction in Q2 2020.15

d. Construction. The construction sector recorded a 25.7 percent growth in Q2

2021, a reversal from the 22.6 percent contraction in Q1 2021 and 29.4
percent decline in Q2 2020. The Q2 outturn brings the sector’s S1 2021
growth to 0.8 percent.

13
IATF Resolution No. 106-B. https://www.officialgazette.gov.ph/downloads/2021/03mar/20210328-IATF-RESO-
106B -RRD.pdf. (Accessed on August 8, 2021)
14
https://meralcomain.s3.ap-southeast-1.amazonaws.com/2021- 07/1h_2021_results_briefing_reports_0.pdf?null.
Accessed on August 9, 2021.
15
PSA Key Economic Indicators (Q2 2021)

National Economic and Development Authority Page 9 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

The Inter-Agency Task Force (IATF) on Emerging Infectious Diseases

guidelines stipulate that essential and priority construction projects, whether
public or private, are allowed even in ECQ as long as they are in accordance
with the guidelines issued by the Department of Public Works and
Highways (DPWH). 16 On May 14, 2021, DPWH issued Department Order
No. 33 s. 2021 clarifying that this includes all small-scale projects such as
those for housing and residences, even in ECQ and MECQ areas. 17

12. Services. Growth in the services sector accelerated to 9.6 percent in Q2 2021 from
-4.1 percent in Q1 2021 and -17.1 percent in Q2 2020. This brings S1 2021 growth
to 2.6 percent. The rebound was mainly supported by the strong growth in real
estate and ownership of dwellings (16.7% in Q2 2021 from -11.7% in Q1 2021),
wholesale and retail trade (5.4% from -3.4%), other services (39.4% from -38.7%),
and transportation and storage (23.4% from -19.6%). Other sectors that posted
faster growth in Q2 are professional and business services (11.7% from -4.4%),
accommodation and food service activities (53.4% from -22.5%), education
(10.0% from 0.2%), and information and communication (14.2% from 6.5%).
However, these were partly tempered by the deceleration in financial and
insurance activities (4.2% from 4.3%), human health and social work (12.1% from
13.2%), and public administration and defense (4.0% from 7.5%).

a. Trade and repair of motor vehicles, motorcycles, personal and household

goods. The sector posted a 5.4 percent expansion in Q2 2021 from -3.4 percent
in Q1 2021 and -14.1 percent in Q2 2020. Higher growth in retail trade (8.9%
in Q2 2021 from -2.5% in Q1 2021) and sale and repair of motor vehicles and
motorcycles (81.2% from 4.5%) outweighed the decline in wholesale trade
(-12.6% from -8.9%).

Meanwhile, sales for both residential (235.5%) and commercial cars (191.5%)
significantly increased during the reference quarter.

16
https://www.officialgazette.gov.ph/ downloads/2021/03mar/20210328-IATF-RESO-106B-RRD.pdf. Accessed on
August 9, 2021.
17
https://www.dpwh.gov.ph/dpwh/sites/default/files/issuances/DO_033_s2021.pdf. Accessed on August 8, 2021.

National Economic and Development Authority Page 10 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

b. Transport and storage. The growth of the sector accelerated to 23.4 percent in
Q2 2021 from -19.6 percent in Q1 2021 and -58.5 percent in Q2 2020. This
brings S1 2021 growth to -4.8 percent. The uptick in transport and storage was
mainly driven by the increase in land transport (28.8 in Q2 2021 from -13.9%
in Q1 2021) and air transport (534.7% from -73.7%) on the back of less
stringent transport restrictions relative to the previous year. In general, public
transportation was allowed to operate, subject to limited capacity and other
travel restrictions. Meanwhile, warehousing and storage and support activities
(8.8% from 2.7) and postal and courier activities (52.3% from 11.5%) also
posted faster growth during the reference quarter.

In June 2021, the DOT allowed leisure travel from NCR Plus areas to other
domestic tourist destinations under MGCQ, subject to travel protocols and other
requirements, which supported the increase in land, water, and air transport. 18
Philippine Airlines (PAL), for instance, serviced a total of 5,338 domestic
flights and ferried around 330,000 passengers in Q2 2021 compared to only 411
flights and 32,000 passengers in the same period last year. 19

c. Accommodation and food service activities. The sector posted a significant

expansion in Q2 2021 at 53.4 percent, a turnaround from the 22.5 percent
contraction in the preceding quarter and 67.1 percent decline in Q2 2020. This
brings S1 2021 growth to -2.3 percent. Both food and beverage service activities
(69.4% in Q2 2021 from -11.0% in Q1 2021) and accommodation (14.7% from
-45.4%), recorded a double-digit expansion during the quarter. This was mainly
on account of less stringent CQ restrictions where food establishments under
MECQ and below were allowed to resume dine-in services subject to limited
capacity. In addition, hotels and accommodations with valid DOT
Accreditation were allowed to operate subject to guidelines issued by the DOT
and the IATF. 20

18
Leisure travel from NCR plus to MGCQ areas now allowed: DOT. Philippine News Agency. Retrieved from:
https://www.pna.gov.ph/articles/1142168. Accessed on August 9, 2021.
19 PSA Key Economic Indicators for Q2 2021
20 Official Gazette. IATF Resolution No. 106-B. https://www.officialgazette.gov.ph/downloads/2021/03mar/20210328-IATF-RESO-
106B-RRD.pdf. (Accessed August 9, 2021).

National Economic and Development Authority Page 11 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

As part of efforts to safely reopen the economy, the Department of Labor and
Employment (DOLE), Department of the Interior and Local Government
(DILG), DOT, and the Department of Trade and Industry (DTI) released a joint
memorandum circular dated April 23, 2021 on the rollout of the Safety Seal
Certification Program. 21 Under this program, business establishments with the
certification were allowed to operate at an additional 10 percentage points more
than the prescribed on-site capacity or seating capacity. 22

d. Information and communication. The information and communication

sector’s growth accelerated to 14.2 percent in Q2 2021 from 6.5 percent in Q1
2021, bringing S1 2021 growth to 10.6 percent. Both communication (14.1%
in Q2 2021 from 6.6% in Q1 2021) and information and publishing (15.3%
from 5.7%) subsectors posted a double-digit expansion during the reference
quarter.

Driven by its data and home broadband segments, PLDT, Inc. and Globe
Telecom, Inc. reported a 10.1 percent and 5.9 percent increase in total service
revenue in Q2 2021, respectively. 23 This could be attributed to the increased
demand for data connectivity in response to flexible work arrangements, online
learning, and other e-commerce activities. Moreover, Dito Telecommunity
Corporation, the country’s third telco player, expanded its mobile services in
the country after its commercial launch on March 8, 2021. 24

e. Financial and insurance activities. Growth in the sector slightly moderated to

4.2 percent in Q2 2021 from 4.3 percent in Q1 2021 and 4.8 percent in Q2 2020.
This brings S1 2021 growth to 4.3 percent. This was mainly due to the
slowdown in banking institutions (3.1% in Q2 2021 from 5.1% in Q1 2021) and
activities auxiliary to financial services activities (1.7% from 2.2%). Bankers

21 JMC 21-01 Implementing Rules and Regulation of the Safety Seal Certification Program: https://dtiwebfiles.s3-ap-southeast-
1.amazonaws.com/COVID19Resources/COVID-19+Advisories/04232021_Joint+Memorandum+Circular+No.+21-01.pdf.
Accessed on August 9, 2021.
22
https://www.officialgazette.gov.ph/downloads/2021/05may/20210531-IATF-RESO-118-A-RRD.pdf
23
PLDT, Inc. and Globe Telecom Inc. Quarterly Reports and PSA Key Economic Indicators for Q2 2021.
24
Retrieved from: https://www.dito.ph/blog-dito-expands-to-more-areas.html. Accessed on August 9, 2021.

National Economic and Development Authority Page 12 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

have remained cautious and continued to tighten overall credit standards for
both enterprises and households. 25 Some of the cited reasons for this tightening
were the deterioration in borrowers’ profile and profitability in bank’s portfolio,
lower tolerance for risk, and uncertain economic outlook. 26 On the upside, non-
banks (6.3% from 3.6%) and insurance and pension funding except compulsory
social security (3.8% from 3.3%) posted stronger growth during the period.

f. Real estate and ownership of dwellings. Growth in real estate and ownership
of dwellings rebounded to positive territory at 16.7 percent in Q2 2021 from -11.7
percent in Q1 2021 and -29.9 percent in Q2 2020. This brings S1 2021 growth
to 0.7 percent. The improved performance of the sector was primarily driven
by the double-digit growth in the real estate sub-sector (44.2% in Q2 2021 from
-23.8% in Q1 2021), which offset the slight slowdown in the growth of
ownership of dwellings (1.0% from 1.1%).

Outsourcing and traditional firms drove demand during the quarter and are
expected to lead office space absorption in the next six to 12 months as the
rollout of the vaccination program continues. 27 However, net take-up remained
negative as Philippine Offshore Gaming Operator (POGO) firms vacated office
spaces along with subdued demand for new office spaces. 28

g. Professional and business service activities. Growth in the sector rebounded

to positive territory at 11.7 percent in Q2 2021 from -4.4 percent in Q1 2021
and -15.7 percent in Q2 2020. This brings S1 2021 growth to 4.2 percent.
Business processing outsourcing (BPO) establishments were allowed to operate
at full capacity despite the lockdowns. In addition, while other on-site
professional activities were only allowed to operate at 50 percent capacity for

25
Bangko Sentral ng Pilipinas. “Banks' Cautious Lending Stance Continue In Q2 2021.”
https://www.bsp.gov.ph/SitePages/MediaAndResearch/MediaDisp.aspx?ItemId=5862 (Accessed August 8, 2021).
26
Ibid.
27
https://www.colliers.com/en-ph/research/colliers-quarterly-property-market-report-q2-2021-philippines. Accessed
on August 9, 2021.
28
https://www.colliers.com/en-ph/research/colliers-quarterly-property-market-report-q2-2021-philippines. Accessed
on August 9, 2021.

National Economic and Development Authority Page 13 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

the duration of the MECQ between April to mid-May, 29 the delivery of

professional services continued as the sector adopted hybrid work arrangements
and the use of online video conferencing applications.

h. Public administration and defense. The growth in public administration and

defense, and compulsory social activities moderated to 4.0 percent in Q2 2021
from 7.5 percent in Q1 2021 and 7.1 percent in Q2 2020. This brings S1 2021
growth to 5.5 percent. Actual disbursements for personal services weakened to
4.9 percent in Q2 2021 partly due to base effects arising from the pay-out of
COVID-19 hazard pay for uniformed personnel in Q2 2020.

i. Education. The education sector recorded a double-digit growth at 10.0 percent

in Q2 2021, higher than the figure of 0.2 percent in the preceding quarter and a
strong rebound from the 14.5 percent contraction in Q2 2020. This brings S1
2021 growth to 5.2 percent. Both private (13.0% in Q2 2021 from -10.8% in
Q1 2021) and public education (9.1% from 6.0%) accelerated during the period.

On April 29, 2021, during the EduAksyon sa Norte virtual visit, the Department
of Education (DepEd) turned over e-learning gadgets, such as smartphones and
laptops, to selected students and teachers from Regions I, II, III, and CAR. 30
This was part of the DepEd’s Public Education Network (PEN), which is
intended to increase digital connectivity of public schools and DepEd offices
nationwide, thus allowing greater access to DepEd learning platforms. 31

The DepEd and the Department of Budget and Management (DBM) also issued
Joint Circular (JC) No. 2 dated June 10, 2021 32 wherein teachers will receive a
PHP5,000 cash allowance intended for the purchase of teaching supplies and
materials, internet and other communication expenses, and annual medical

29
DTI Memorandum Circular No. 21-14, s. 2021 dated 23 April 2021. Retrieved from:
https://www.dti.gov.ph/sdm_downloads/memorandum-circular-21-14/. Accessed on August 9, 2021.
30
https://www.deped.gov.ph/2021/05/10/deped-continues-public-education-network-build-up-after-turning-over-e-
learning-gadgets-to-north-luzon-regions. Accessed on August 8, 2021.
31
Ibid.
32
https://www.deped.gov.ph/2021/06/14/deped-to-release-public-school-teachers-cash-allowance-for-sy-2021-2022.
Accessed on August 8, 2021.

National Economic and Development Authority Page 14 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

examination expenses. 33 The release of the cash allowance began on June 15,
2021. 34

j. Human health and social work activities. The health and social work sector
grew by 12.1 percent in Q2 2021, slightly lower than the 13.2 percent figure in
the previous quarter but a significant improvement from -15.4 percent in Q2
2020. This brings S1 2021 growth to 12.7 percent. The slowdown in the health
sector was primarily driven by the contraction in public human health (-34.8%
from 48.0%) and social work activities (-43.2% from 36.5%). These were partly
offset by the double-digit expansion in private health (48.3% from -2.0 %).

k. Other services. Growth in other services accelerated to 39.4 percent in Q2 2021,

a substantial increase from -38.7 percent in the preceding quarter and -63.7
percent in Q2 2020. This brings S1 2021 growth to -16.1 percent. Both arts,
entertainment and recreation (62.6% in Q2 2021 from -45.5% in Q1 2021) and
other service activities (19.1% from -28.7%) recorded a higher growth during
the reference period. In fact, some personal care services were allowed at least
a 30 percent operational capacity even under MECQ. 35

D. Prospects and policy directions

13. The International Monetary Fund (IMF) 36 maintained its 2021 growth
projections for the global economy at 6.0 percent, while it raised its 2022
forecast to 4.9 percent from an earlier estimate of 4.4 percent. For 2021, the
better outlook for advanced economies was offset by less favorable prospects for
33
https://www.dbm.gov.ph/wp-content/uploads/Issuances/2021/Joint-Circular/Certified-True-Copy-JC-on-Cash-
Allowance.pdf. Accessed August 8, 2021.
34
https://www.pna.gov.ph/articles/1144431. Accessed on August 9, 2021
35
Official Gazette. IATF Resolution No. 115-A. https://iatf.doh.gov.ph/wp-content/uploads/2021/05/20210513-IATF-
Resolution-115-A-RRD.pdf. (Accessed \August 9, 2021)
36
International Monetary Fund, World Economic Outlook, July 2021.

National Economic and Development Authority Page 15 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

emerging and developing economies, especially for emerging Asia. These mainly
reflect pandemic developments and changes in policy support across countries.
For 2022, the anticipated legislation of additional fiscal support, particularly in
the United States, and improved health metrics resulted in the upward revision of
the forecast. Downside risks remain, such as slower-than-anticipated vaccine
rollout and tight financial and external conditions, which may drag down global
economic growth.

14. For the Philippines, the Development Budget Coordination Committee (DBCC)
will review the recent economic data and the risks associated with the Delta
variant to fine-tune our growth targets and adjust our recovery strategies. As of
July 2021, the DBCC-approved growth targets are 6.0 percent to 7.0 percent for
2021 and 7.0 percent to 9.0 percent for 2022. The private sector forecasts show
signs of recovery, with an average growth estimate of 5.0 percent in 2021 (see
Table 2).

National Economic and Development Authority Page 16 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

Table 2: Consensus GDP Growth Forecasts 37

Institution As of 2021 2022

National Australia Bank/ Bank of New Zealand August 9 4.5 6.4
Bank of America Merrill Lynch August 6 4.0 7.1
JPMorgan Chase August 6 5.3 6.5
Standard Chartered August 6 4.6 6.6
ING Group August 3 4.3 4.3
Barclays July 30 5.0 7.0
IMF July 27 5.4 7.0
Nomura Securities July 27 5.4 8.7
Fitch Solutions July 26 5.3 6.5
Capital Economics July 23 6.0 12.0
Moody’s Investor Service July 22 5.8 6.5
ADB July 20 4.5 5.5
Fitch Ratings July 12 5.0 6.6
World Bank June 10 4.7 5.9
Mean 5.0 6.9
Median 5.0 6.6

15. The significant improvement in almost all economic indicators highlights the
gains from our risk-based approach to quarantines and our strong economic
potential. The government will continue to accelerate the implementation of our
three-pillar strategy to achieve our growth and job targets. First is the acceleration
of the vaccination program; second is the safe reopening of the economy, while
strictly adhering to public health protocols; and third is the full implementation of
the recovery package.

37
Various sources.

National Economic and Development Authority Page 17 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

16. The government is taking proactive measures to reduce the spread of COVID-
19 and accelerate the country’s vaccination program. The re-imposition of
ECQ in high-risk areas, including NCR, from August 6 to 20, 2021, is the
proactive response to address the spread of the more contagious Delta variant and
preclude the return of more lockdowns down the road. During this period, the
government will further accelerate the vaccination program. Everyone is
encouraged to use this ECQ period to get vaccinated, so we can safely reopen the
economy once we have contained the spread of the Delta variant.

17. The government has activated a crisis action plan focusing on the enhanced
implementation of the Prevent, Detect, Isolate, Treat, Reintegrate, plus
Vaccinate (PDITR+V) strategy. 38 This includes the four-door strategy of stricter
border control, heightened surveillance, quick response, and focused and
expanded mass vaccination. Measures to expand the hospital capacity are already
in place, such as the availability of more intensive care unit (ICU) and isolation
beds, and procurement of oxygen tanks, medications, and other needed logistics.
Travel ban imposed on countries experiencing a surge of COVID-19 Delta variant
cases, checkpoints, and other border control measures are also being strictly
enforced. Nonetheless, there is still a need to ramp up COVID-19 genome
sequencing by operationalizing more laboratories for the faster detection of Delta
variant cases and stem its transmission.

18. The country’s vaccine deployment program will be further accelerated and
expanded. The government’s vaccination program is on track. The country has
been receiving a steady supply of vaccines from multiple sources. As of August
10, 2021, a total of 38.6 million doses have arrived in the country between
February 28 to August 8, 2021.

Our LGUs and partners in the private sector have shown a remarkable ability to
administer the vaccines on a wide scale. Last August 5, the country recorded an
all-time high of 710,482 jabs in a day. As of August 8, a total of 24.5 million doses

38
https://www.pna.gov.ph/articles/1149681. Accessed on August 7, 2021.

National Economic and Development Authority Page 18 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

have been administered, consisting of 13.1 million for the first dose and 11.4
million for the second dose.

For the remainder of the year, more than 148 million doses of vaccine are expected
to arrive. With this, the government is optimistic in inoculating 70 million Filipinos
or the entire adult population by the end of 2021. This is a step closer to achieving
herd immunity in the country. Moreover, it will help build consumer and business
confidence and help facilitate the resumption of business operations in the country.

19. The economy’s recovery will also get a boost from the 2021 budget, the Build,
Build, Build program, and the implementation of the Corporate Recovery and
Tax Incentives for Enterprises or CREATE law. The economic team also looks
forward to the passage of the amendments to the Public Service Act, the Retail
Trade Liberalization Act, and the Foreign Investment Act. All these will help
attract investments, push up our growth potential, and create more and better jobs.

20. Guidelines on allowed operational capacities of firms will be regularly reviewed

as more Filipinos get vaccinated. Existing CQ guidelines will be revisited as
more Filipinos get vaccinated and as firms apply for the DTI’s Safety Seal
Certification, a system which affirms an establishment’s compliance with the
minimum public health standards (MPHS). 39 Allowing higher operational
capacities to account for vaccination rate and adherence to MPHS can reduce the
cost of lockdown on businesses and allow more workers to return to work.
Establishments are likewise encouraged to innovate and adopt digital solutions to
ensure business and service continuity while enabling people to work and earn
income.

39
Department of Trade and Industry. ‘Safety Seal’. https://www.dti.gov.ph/safetyseal/ (accessed August 5, 2021).

National Economic and Development Authority Page 19 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

21. Financial assistance will be provided to those affected by the current lockdown.
The DBM released PHP10.9 billion to cover the financial assistance for the
bottom 80 percent of the population in NCR affected by the imposition of ECQ. 40
Low-income individuals and families are expected to receive PHP1,000 per
person with a maximum amount of PHP4,000 per household, to ensure that food
and non-food requirements are met during the two-week lockdown.

22. The timely passage of the FY 2022 budget will support economic recovery. The
proposed FY 2022 Budget amounting to PHP5.0 trillion will sustain the
government’s COVID-19 response efforts through the procurement of COVID-
19 testing kits, continuous hiring of human resources for health, establishment of
the Virology Institute of the Philippines, and the continuous implementation of
health programs in accordance with the Universal Health Care Act. 41

23. The government needs to address planning and coordination weaknesses to

ease the transition of devolved functions to LGUs in light of the Mandanas
Ruling. With the signing of Executive Order No. 138, 42 concerned National
Government agencies (NGA) and LGUs are mandated to prepare devolution
transition plans for the latter’s smooth delivery of devolved functions and public
services starting next year. A Growth Equity Fund will also be proposed to
Congress to assist the poorest LGUs in the implementation of the devolved
services. To strengthen their implementation capacity and public service delivery,
LGUs will be provided capacity-building interventions based on their respective
Capacity Development Agenda.

40
https://www.dbm.gov.ph/index.php/secretary-s-corner/press-releases/list-of-press-releases/1915-dbm-releases-p10-
894-billion-for-financial-assistance-to-ncr. Accessed on August 7, 2021.
41
https://dbm.gov.ph/index.php/secretary-s-corner/press-releases/list-of-press-releases/1910-dbm-assures-timely-
submission-of-the-fy-2022-nep-to-congress. Accessed on August 6, 2021.
42
Executive Order No. 138, series 2021. Full Devolution of Certain Functions of the Executive Branch to Local
Governments, Creation of a Committee on Devolution, and for Other Purposes. Retrieved from:
https://www.officialgazette.gov.ph/downloads/2021/06jun/20210601-EO-138-RRD.pdf

National Economic and Development Authority Page 20 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

24. Food inflation can be further reduced, especially amid the implementation of
stricter CQs throughout the country, by ensuring adequate supply of basic
commodities. While border controls are in place due to quarantine restrictions in
several areas, the Department of Agriculture (DA) assured the public that the
delivery of agricultural goods and other food products will remain unhampered. 43

In addition, the President signed Executive Order Nos. 133 and 134 to address the
spike in pork prices due to the ASF through a higher minimum access volume and
lower tariffs. Since then, pork inflation has decreased from 58.4 percent in May to
38.4 percent in July.

Meanwhile, rice prices continued to fall with inflation of -1 percent in July. The
Rice Tariffication Law has achieved its dual goal of bringing down retail prices
while helping farmers improve productivity through the Rice Competitive
Enhancement Fund or RCEF. Executive Order 135, which reduced the most-
favored nation tariff rate of rice outside ASEAN, also contributed to ensuring
adequate rice supply at affordable prices.

The government will also proactively ensure that fish prices do not rise further as
supply narrows in the upcoming close fishing season starting October. The DA is
preparing to issue certificates of necessity to import (CNI) to cover the supply gap.

25. Calibrated hog repopulation efforts need to be implemented in areas cleared of

the ASF to augment supply. 44 Based on the latest projections from the DA, a pork
supply deficit of around 199,344 metric tons (equivalent to 45 days’ worth of
stocks) is expected by the end of the year. 45 While the supply deficit may be eased
by the arrival of imports allowed under Executive Order Nos. 133 and 134, 46

43
https://pia.gov.ph/press-releases/2021/08/02/da-transport-of-goods-remain-unhampered-amid-reimposition-of-ecq-
in-metro-manila. Accessed on August 7, 2021.
44
Five municipalities (Rosario, Malvar, San Jose, Nasugbu, Taysan), and the City of Lipa in the province of Batangas
have been declared ASF-free as of June 18, 2021. ASF Control Taskforce Facebook Page. Retrieved from:
https://fb.watch/6ug--8UvSZ/
45
DA Presentation in the 28th TGFS meeting on July 15, 2021.
46
Increasing the MAV for pork meat (EO No. 133) and modifying the rates of import duty on fresh, chilled, or frozen
meat (EO No. 134).

National Economic and Development Authority Page 21 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

calibrated repopulation (i.e., sentinelling) and rehabilitation efforts through the

INSPIRE program need to be accelerated to ramp up local production. Both
initiatives will help address pork supply concerns in the second half of the year.
Moreover, the government may need to further strengthen its biosecurity,
phytosanitary, and border control measures in the transport of imported and local
produce within localities as more ASF cases are detected in other countries.
Meanwhile, the DA-Bureau of Animal Industry (DA-BAI) is currently testing two
prototype ASF vaccines in 10 private companies. Should the experiment yield
positive results, the ASF vaccine will be publicly available by the end of August
2021. 47

26. Disaster management response needs to be strengthened amid torrential rains

and possible re-emergence of La Niña in the second half of the year. Based on
the latest climate outlook of the Philippine Atmospheric, Geophysical, and
Astronomical Services Administration (PAGASA), around nine to 12 tropical
cyclones may enter the Philippines from August 2021 to January 2022. Moreover,
La Niña is likely to re-emerge (55% chance) in September-November 2021 and
may persist until the first quarter of 2022. 48 As more typhoons enter the country
in the second half of the year and the risk of COVID-19 transmission remains,
evacuating residents will be a challenge. LGUs and Local Disaster Risk Reduction
and Management Councils (LDRRMC) are enjoined to revisit existing protocols
and ensure the safety of evacuees from both calamities and possible COVID-19
infections.

27. The timely implementation of the National ID system will facilitate

digitalization in the country and support the new normal. The National ID can
support digitalization by streamlining day-to-day processes, such as transactions
with the government and the private sector. Amid the COVID-19 pandemic, the
government adopted a three-step registration process to register applicants to
Philippine Identification System (PhilSys) in a safe and efficient manner. As of
August 6, a total of 39.7 million individuals were registered for Step 1 or the

47
Retrieved from: https://www.pna.gov.ph/articles/1148131 (accessed on August 7, 2021)
48
Retrieved from https://pubfiles.pagasa.dost.gov.ph/climps/climateforum/climateoutlook.pdf (accessed on August
8,2021)

National Economic and Development Authority Page 22 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

collection of demographic data. Of these, 23.7 million individuals registered to

Step 2 or the capture of biometrics at designated registration centers. Over
891,000 successful registrants to Step 3 have received their PhilSys Number
(PSN) and PhilID card.

28. Human capital development is necessary to remain competitive and reverse the
impact of the pandemic. In terms of learning outcomes, studies found that remote
education may worsen inequality 49 as some households have limited access to
reliable internet and necessary devices. The Asian Development Bank (ADB) also
estimated that each year of school closure incurs PHP1.9 trillion worth of losses
to the economy. NEDA’s preliminary estimates show that this could be even
higher. Therefore, the protracted duration of remote learning will have a
significant effect on the learning outcomes of children and the economy as a
whole. To alleviate these effects, the DepEd’s Sulong EduKalidad program
may be pursued, including (a) the review and update of the K to 12 curriculum;
(b) improvement of learning environment, particularly in geographically isolated
and disadvantaged areas (GIDAs); (c) upskilling and reskilling of teachers; and
(d) engagement of stakeholders for support and collaboration to deliver quality
education. The development of human capital will enable individuals to realize
their full potential and facilitate the country’s transition to high-value economic
activities.

29. On the external front, mechanisms that will enable faster response to supply
constraints need to be instituted. The government continues to improve its trade
facilitation processes as four more Trade Regulatory Government Agencies
(TRGAs) will start onboarding in the TradeNet System on August 2021. 50 The
Maritime Industry Authority (MARINA) also granted consent for bareboat
chartering 51 to two domestic shipping companies to augment the shipping capacity
and address the current shortage in vessel space, thereby allowing exporters to

49
UNICEF-UNDP. ‘The Impact of the COVID-19 Crisis on Households in the National Capital Region of the
Philippines’. https://www.unicef.org/philippines/reports/impact-covid-19-crisis-households-national-capital-region-
philippines (accessed August 6, 2021)
50
https://customs.gov.ph/customs-welcomes-four-regulatory-agencies-in-the-new-nsw-system/ Accessed on August 7,
2021.
51
Bareboat chartering refers to hiring a boat or ship with the people renting the boat assuming the responsibility for
appointing the crew, including making other arrangements.

National Economic and Development Authority Page 23 of 24

 REPORT ON NATIONAL INCOME ACCOUNTS
(Q2 2021)

capitalize on improving global demand. Amendments to the Customs

Modernization and Tariff Act (CMTA) that will streamline the process of
modifying applied tariff rates during national emergency may likewise be
considered. In addition, the government may lay the groundwork to maximize the
preferential access provided by the Regional Comprehensive Economic
Partnership (RCEP) in 2022.

30. The passage of key economic reforms remains a big part of the country’s
recovery. The Legislative-Executive Development Advisory Council (LEDAC)
Executive Committee (ExCom) agreed to prioritize the passage of the various
legislative measures by December 2021, including bills relating to the business
sector such as:
a. Amendments to the Retail Trade Liberalization Act
b. Amendments to the Foreign Investments Act
c. Amendments to the Public Service Act
d. Establishing the Tax Regime of Philippine Offshore Gaming Operators
e. Government Financial Institutions Unified Initiatives to Distressed
Enterprises for Economic Recovery (GUIDE) Act
f. Department of Migrant Workers and Overseas Filipinos Act
g. Passive Income and Financial Intermediary Taxation Act
h. Virology Science and Technology Institute of the Philippines
i. Rural Agricultural and Fisheries Development Financing System Act (Agri-
Agra Law)
j. Real Property Valuation Reform Act

National Economic and Development Authority Page 24 of 24