MANILA, Philippines -- The government has lowered further its economic growth targets for 2008 in the face of the financial crisis in the United States, a senior official said Wednesday.

Socioeconomic Planning Secretary Ralph Recto said in a statement that government planners now expect the country's gross domestic product (GDP) to grow between 4.4 and 4.9 percent this year.

The figure is a further reduction from the 5.5 to 6.4 percent target set last month. Manila originally forecast 2008 GDP growth at 5.7 to 6.6 percent but has since downgraded this in the face of rising prices of oil and food.

Recto said he expected Washington lawmakers to eventually pass a bailout package to stabilize the financial markets after the first was rejected Monday. But he said it might not be enough to prevent the United States from going into recession.

Such a development would affect the economy of the rest of the world including the Philippines, forcing the government to lower its growth targets, he said.

The GDP growth projection for 2009 was also brought down to 4.1 to 5.1 percent from earlier projections of about 6.1 to 6.8 percent, said Recto.

"The bright side is we expect food and oil prices to stabilize and expect inflation to be lower. Exports will be flat, interest rates will slightly go up, and the government deficit will be within target," Recto added without giving specific figures.

The Philippines in 2007 posted its highest GDP growth in three decades at 7.3 percent.

However the country, which imports rice and virtually all of its oil, has been hit hard by the rising global prices of food and fuel.