Gov’t to retain growth targets for the next 2 years

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Budget Secretary Florencio Abad: Growth targets conservative but encouraging. INQUIRER FILE PHOTO

MANILA, Philippines—The government’s economic team has retained the country’s official growth targets for this year and next year, believing the Philippines is poised to still outperform many of its neighbors.

With the decision, the economic growth targets stay at the range of 6 to 7 percent for this year, and the range of 6.5 to 7.5 percent for next year.

Budget Secretary Florencio Abad, who also serves as chair of the interagency Development Budget Coordination Committee (DBCC) that sets the government’s macroeconomic targets and policies, noted that the Philippines’ growth targets are conservative but at the same time encouraging enough, given lingering uncertainties in the global economy.

In the first quarter of the year, the Philippine economy actually grew by 7.8 percent, the fastest growth rate in Asia for the period. The growth surpassed even China’s 7.7 percent.

But Abad said the economic team opted to stay conservative and decided against raising the targets despite the remarkable performance of the economy in the first quarter.

He said there remains no solid proof that the United States and eurozone will significantly recover. He also said China may be showing signs of a slowdown.

The United States, the eurozone and China are three of the biggest trading partners of the Philippines. They account for a substantial portion of Philippine export earnings and serve as key sources of goods imported by the Philippines.

“There are no changes in the macroeconomic targets. We decided to stay conservative,” Abad told reporters after the DBCC meeting Wednesday evening.

Socioeconomic Planning Secretary Arsenio Balisacan echoed Abad’s statement, saying there is a chance for the Philippines to exceed the growth targets given favorable domestic developments, but that keeping the original targets to take into account economic uncertainties outside the country is wise.

Balisacan cited improving consumer and business sentiment in the Philippines that is expected to boost consumption and investments this year and next year.

Balisacan also said the government intends to further push its infrastructure development program as a strategy to sustain a robust economic growth rate and to create jobs over the medium term.

“The government intends to build more roads, highways, railways, ports, etc. The Philippines has a huge backlog in infrastructure investments and so we want to spend more on this,” Balisacan told reporters.

Abad said that for 2013, the government’s infrastructure budget is set at P400 billion. He said the DBCC wants to increase the infrastructure budget over the years until it hits P800 billion by 2016.

The push for higher infrastructure budget comes amid views that such will significantly boost job creation and trim poverty.

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  • disqusted0fu

    The Aquino administration doesn’t know what it’s setting up itself for. The recent economic growth is for the most part because of GMA economic reforms and then the OFW remittances and BPOs. Other than that, what else is the admin going to do to sustain the growth???

  • Ako_Hiking

    The Aquino Administration is benefiting from and enjoying an economic growth started by the previous Administration. But what is sad and disappointing is even with all the upswing that the Aquino Administration absorbed they’ve allowed poverty to continue to increase along with the unemployment numbers.

  • gringoloco

    This morning I went to buy rice where I live, Dipolog City, Zamboanga del Norte.
    I almost had a heart attack….!!!!!!!!!!
    The price of rice WENT UP ABOUT 25% per kilo..!!!!!!
    From the cheapest one to the most expensive one…….25% increase.
    My God, is this the way President Aquino wants to trim poverty?
    Talking about how the economy is improving……..but making millions of people go to bed hungry.
    I like to know the reason why the increase of rice and what the comments of the government.

  • Pong_Je

    Expect Mr. Diokno to be interviewed and expressed differing views. I even remember reading it in the past that he thinks there no economic benefits can be gain from spending in infrastructure. tsk.tsk.

  • MDLANHAM

    I am keeping my fingers crossed. Go Team Pnoy !!!!

  • stopcorruption007

    ang laki naman ng backlog na hinahabol dahil kasi yan sa mg nakaraan na admin na walang alam kung di mamulitika at corruption. kudos to aquino admin. sana maipasa na ang FOI bago pakawalan ang napakalaking budget na yan para wala ng doubt lalo na sa mga kritiko. wala ng maniniwala sa mga kritiko kapag naipasa na ang FOI.

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