Indeed, a lack of real convergence in income levels is, more often than not, the result of a lack of convergence in institutional quality.19 You can see this on my next slide – a slide I like to show because I think it makes a compelling point, notwithstanding the usual caveat on the two-way causality between institutional quality and income levels.20  8 / 16  BIS central bankers' speeches  Most CESEE economies are still in the lower left-hand corner, meaning there remains a significant gap in overall institutional quality compared with the average level observed in the EU as a whole.
Against this backdrop, the Philippine economy grew by 12.0 percent in the second quarter of 2021 and by 7.1 percent in the third quarter. The faster-than-expected expansion in the third quarter was driven by the industry and services sectors. In contrast, the agriculture sector contracted, owing to weather disturbances and the African swine fever that affected livestock.