The latest figure was higher than the gross domestic product (GDP) growth rates of seven percent in the second quarter of the year and 6.2 percent in the third quarter of 2015.

Malacañang said the latest growth figure has shown the Duterte administration is not losing its focus on the economy despite its vigorous anti-drug campaign.

“This underscores that the Duterte administration offers more than war on drugs. We have a sound economic vision and agenda that will spur growth to benefit the lives of our countrymen especially the poor and the marginalized,” Communications Secretary Martin Andanar said. The third quarter represents the first three months of the Duterte administration.

Before leaving for Peru for the APEC summit, Duterte said his administration is “working very hard to make sure that our economy will finally take flight.”

“Our people are at the core program on inclusive growth and sustainable development. We will spare no effort to realize this in the context of APEC,” he added.

Economic output in the third quarter was also boosted by the positive growth of 2.9 percent in the agricultural sector after five consecutive quarters of decline, as farm output recovered from the prolonged dry spell brought about by the El Niño phenomenon.

Growth in the industry sector accelerated to 8.6 percent compared with 6.1 percent recorded in the same period last year due largely to gains in manufacturing and construction.

The services sector, meanwhile, grew at a slower “but still reasonable” pace of 6.9 percent in the third quarter from 7.2 percent last year.

The country’s third quarter economic growth outpaced China’s 6.7 percent, Vietnam’s 6.4 percent, Indonesia’s five percent and Malaysia’s 4.3 percent.

“This cements our chance of achieving our target of six to seven percent for the whole of 2016,” said Rosemarie Edillon, deputy director general of the National Economic and Development Authority (NEDA).

To reach the high end of the growth target for the year, the economy needs to register a growth rate of 6.9 percent in the fourth quarter.

Edillon also noted the encouraging recovery in the agriculture sector with the normalization of weather conditions. The sector is “one of the major development priorities of this administration,” she said.

She also noted strong public investment in infrastructure with public construction expanding by over 20 percent in the third quarter. Private consumption also rose by 7.3 percent from 6.1 percent last year as households prioritized enrollment expenses.

Consumption strong

Despite the slower growth in OFW remittances, private consumption remains strong because of low inflation, low interest rates and improved labor market conditions.

The conditional cash transfer provided by the government to the poorest of the poor also boosted domestic consumer demand.

“All things considered, our economy’s strong growth in the third quarter is a very good sign of things to come. Together with a low inflation environment, a sustained strong growth bodes well for continued poverty reduction this year,” said Edillon.

She said strong domestic demand and government spending would continue to drive growth in the fourth quarter.

Agriculture would remain in the positive growth territory if the gains in the crops, livestock and poultry sectors were maintained.

The manufacturing sector is also seen to benefit from strong domestic demand. Advanced, emerging, and developing economies are also seen to increase imports of goods in 2017. Construction would also remain a major contributor to growth in the near term if the government would hold its commitment to a massive infrastructure investment program.

Posing risks to the economy are the possible occurrence of La Niña, sluggish recovery in the European economy, and uncertainties in economic policies in the United Kingdom and the US.

The resurgence of the so-called Saudization policy – the replacement of foreign workers with Saudi nationals – also threatens the employment and remittance of OFWs.

With regard to jitters caused by the promised implementation of protectionist economic policies in the US under a new administration, Edillon said the Philippines is still waiting for further developments and is bracing for adverse impact.

“The best scenario is of course we will foster closer ties with the US. As you know, the recent pronouncements of our president are really about having closer ties,” she said. “The worst case if he (Trump) delivers on his campaign promises but we are hoping that it would be closer to the best case scenario because of the political realities that president-elect Trump would have to face. So it should be somewhere in between,” she said.

She also said the business process outsourcing (BPO) industry in the Philippines may survive the change of leadership in the US as American firms profit from their offshore operations.

With the strong economic output in the third quarter, the government may need to review its growth targets.

“We will be having a new DBCC (Development Budget Coordination Committee) meeting in December and we will take stock of what is happening,” she said. – With Giovanni Nilles, Paolo Romero