J. Albert Gamboa l November 18, 2022 l The Manila Times
MOST economists and market analysts were surprised at the 7.6-percent growth of the Philippines’ gross domestic product (GDP) in the third quarter. In a poll conducted by Reuters, analysts had a median forecast of 6.3 percent for the July to September period, while Bloomberg estimated GDP to grow by 6.2 percent on an annual basis.
Even the country’s chief economist, Socioeconomic Planning Secretary Arsenio Balisacan, expressed surprise at the high GDP growth reported by the Philippine Statistics Authority (PSA). As director general of the National Economic and Development Authority (NEDA), he noted that the better-than-expected performance was achieved despite the surge in inflation and interest rates.
Among the 10 Southeast Asian nations, only Malaysia and Vietnam surpassed our GDP performance with double-digit growth rates of 14.2 percent and 13.7 percent, respectively. Next to the Philippines were Indonesia at 5.7 percent and Singapore at 4.4 percent.
NEDA Undersecretary and National Statistician Dennis Mapa, who also heads the PSA, disclosed that the main contributors to the country’s third-quarter growth were the construction industry at 12.2 percent; wholesale and retail trade at 9.1 percent; and the financial services sector at 7.7 percent.
Exponential fintech growth
In the field of financial technology (fintech), Philippine Stock Exchange-listed DFNN Inc. recorded its highest-ever revenue amounting to P970.6 million for the first nine months of 2022. Its nearly billion-peso earnings reflected a 173-percent growth over the same period in 2021.
The fintech firm also posted a record 497-percent surge in earnings before interest, taxes, depreciation and amortization (Ebitda) in the first three quarters of this year. It registered an increase of P324 million in Ebitda compared to a P65.2-million loss in 2021. Thus, its net income from January to September stood at P140.4 million, sustaining a 216-percent growth year on year.
DFNN President and Chief Executive Officer Calvin Lim said: “The DFNN Group’s consistent revenue growth is a testament to our highly effective business strategy that focuses on a robust digital platform. Our efforts toward innovation will continue as we go head-to-head on another challenging year fighting inflation and other economic headwinds.”
Revenues from share-based income generated from interactive operations rose by 204 percent, while sales of software and application licenses posted a 21.2-percent increase. In spite of the high inflationary environment, all areas of DFNN’s businesses exhibited a growth trend this year.
Lim believes the local IT (information technology) sector is extremely strong and will keep on growing. Thus, he prescribes that the next step should be to take the industry to a globally competitive scale.
This direction will be in sync with the Philippine economy’s growth trajectory, barring the escalation of the Russia-Ukraine war and the emergence of a global recession in 2023.
*** The author is the chief finance officer of Asian Center for Legal Excellence and chairman of the Finex Media Affairs Committee. The opinion expressed herein does not necessarily reflect the views of these institutions and The Manila Times.