6% growth in ’15 seen still possible

Budget Secretary Florencio B. Abad on Friday said hitting the lower end of the economic growth projection of 6 to 6.5 percent for 2015 is possible, as he expects faster expansion in the last three months of the year on the back of fast-tracked government spending.

“We now have the momentum after a slow start in the first quarter marked by a 5-percent growth, recovery in the second quarter at 5.8 percent, and sustained growth in the third quarter. It’s still possible to grow by 6 percent for the whole year of 2015,” Abad said in a statement.

On Thursday, the government reported that the economy grew by 6 percent in the third quarter mainly due to sustained robust consumer spending and improved government expenditures on public goods and services.

At the end of the first nine months, the average GDP growth stood at 5.6 percent.

The government’s official GDP growth target for 2015 is 7 to 8 percent, but economic managers had already conceded that the economy could only expand this year by only 6 to 6.5 percent. The economy should grow by at least 6.9 percent in the fourth quarter to reach the lower end of the realistic growth target.

Abad said he “foresees even higher GDP growth in the fourth quarter.”

“As in the third quarter, public spending will again play a pivotal role in the economic expansion in the fourth quarter. The fourth quarter has always been a strong period in terms of public spending as agencies rush to finish their projects,” Abad said.

The latest Treasury data showed that end-September expenditures reached P1.631 trillion, higher than the P1.456 trillion a year ago but lower than the nine-month program of P1.907 trillion.

“Because of the reforms introduced, like the elimination of the need for SAROs (special allotment release orders), the significant reduction of lump sums and the advance procurement of goods and services, the DBM (Department of Budget and Management) is certain to match its yearly average of 98 percent releases,” the budget chief added.

Latest DBM data showed that as of end-October, P1.295 trillion or 97.1 percent of agency budgets had already been released