The holiday island of Boracay, which pumps roughly $1 billion into the economy, was shuttered in April for a six-month clean up on the orders of President Rodrigo Duterte

Manila (AFP) - Philippine economic growth slowed sharply in the second quarter and fell well short of expectations as a result of policy decisions that included the shutdown of holiday island Boracay, officials said Thursday.

The six percent expansion in April-June was the weakest in three years and ended a run of 10 consecutive quarters in which the economy grew at least 6.5 percent. Forecasts in a Bloomberg News survey put growth at 6.6 percent.

“The slowdown is partly due to policy decisions undertaken that are expected to promote sustainable and resilient development,” Economic Planning Secretary Ernesto Pernia said.

“We are referring to the temporary closure of Boracay,” he added.

The holiday island was shuttered in April for a six-month clean up on the orders of President Rodrigo Duterte, who branded the resort a “cesspool” sullied by tourism-related businesses flushing sewage into the sea.

Despite the lower-than-expected figures, the Philippines remains one of the best-performing economies in Asia behind Vietnam’s 6.8 percent and China’s 6.7 percent for the quarter.

The results come as concern is growing in the Philippines over inflation, which hit a five-year-high 5.7 percent in July.

The central bank is expected to raise key interest rates at its meeting later Thursday.

In addition to the slower second quarter numbers, Pernia said gross domestic product for the first three months of 2018 was also adjusted downward to 6.6 percent, from 6.8 percent.

He said this meant the economy only grew 6.3 percent in the first half, well below the 7-8 percent full-year target.

Pernia said the closure of Boracay, which the government says draws two million tourists each year and pumps roughly $1 billion into the economy, “partly made a dent on the economy with growth in exports of service slowing”.

Agriculture’s anaemic 0.2 percent growth did not help, while mining also slowed due to the closure of several pits and higher mineral taxes.

Industrial growth also eased because of strict regulations of controlled chemicals and higher shipping rates.

“We are also gravely concerned about the almost stagnant output of the agriculture sector,” Pernia said, noting a “gross deficiency in the domestic production of food” had helped fuel inflation.

The government is preparing a raft of “temporary” measures to improve food supplies, he said, including cuts to import duties of certain products and possible lifting of government quotas on imports of rice, the country’s staple cereal.

The ceiling was meant to protect Filipino rice farmers from competition with imported grains, but Pernia wants it replaced with temporary tariffs.