Q1 spending may lift first half growth

Government spending related to the May 12 midterm elections—frontloaded expenditures prior to the polls as well as the resumption of delayed projects due to the election ban—would likely spill over into the second quarter and support first-half economic growth, economists said.

- BY BEN ARNOLD DE VERA

"While the election spending ban may temper second-quarter outlays, the strong first-quarter momentum—fueled by an 18.7-percent surge in public expenditures—could still support carryover effects in construction, consumption, and private investment," Robert Dan Roces, economist at the Sy family-led conglomerate SM Investments Corp. (SMIC), told Manila Bulletin on Monday, May 12.

For Roces, robust spending on public goods and services at the start of the year would "help sustain solid first-half growth despite tighter fiscal space."

For his part, Rizal Commercial Banking Corp. (RCBC) chief economist Michael Ricafort said that he considers the nearly 20-percent growth in first-quarter government spending as "a major driver of economic growth" for 2025.