Wealth-generating economy set
Economic managers yesterday expressed confidence that tax reform and the infrastructure push, among other reforms introduced by the Duterte administration thus far, would sustain robust economic growth while slashing poverty and inequality until 2022.
“One year into [President Duterte’s] term, I can say with confidence that we have successfully laid the groundwork for a wealth-generating and wealth-distributing economy,” Budget Secretary Benjamin E. Diokno said at an economic forum organized by the Economic Journalists Association of the Philippines.
Diokno said all of the administration’s efforts were aimed at elevating the country into upper middle-income status by 2022, with poverty incidence reduced to 14 percent from 21.6 percent in 2015.
Even as the average gross domestic product (GDP) growth in the first half was a slower 6.5 percent, Socioeconomic Planning Secretary Ernesto M. Pernia said they expected full-year growth this year to accelerate close to the midrange of the 6.5-7.5 percent target.
To support economic expansion moving forward, the government earlier unveiled the “Build, Build, Build” program, under which 75 flagship, “game-changing” infrastructure projects would be started and finished in the next six years.
Pernia, who heads the state planning agency National Economic and Development Authority, noted that the Neda Board chaired by the President in the first year of the administration already approved 28 major capital projects, of which 18 were flagship infrastructure projects.
Under “Build, Build, Build”, the government will spend up to P9 trillion on hard and modern infrastructure until 2022 to usher in a “golden age of infrastructure.”
In a video message, Finance Secretary Carlos G. Dominguez III said the infrastructure buildup would close the gap between our economy’s logistics backbone and those of the most dynamic economies in our region.
“We can no longer postpone investments in infrastructure. For three decades, our economy underspent on infrastructure as we imposed one austerity program after another to climb out of the debt crisis. We have successfully worked down our debt load. Our credit rating improved to investment grade,” said Dominguez, who heads the Duterte administration’s economic team.
“We intend to maintain the regime of fiscal discipline even as we are prepared to widen the deficit margin a little more [to 3 percent of GDP]. Much of the first wave of the infra program will be funded through ODAs (official development assistance), which offer much lower rates than the best the commercial market offers,” Dominguez said.
Dominguez stressed that the comprehensive tax reform was crucial to raise additional revenues needed to finance the ambitious infrastructure program. —BEN O. DE VERA