Gov’t lowers 2016 GDP growth target

EXTERNAL risks brought on by a slowing Chinese economy and cheaper oil led the government to cut the economic growth target for this year to 6.8-7.8 percent from the previous 7-8 percent.

According to Rosemarie G. Edillon, National Economic and Development Authority (Neda) assistant director general, the target average growth range for 2017 is projected between 6.6 and 7.6 percent; for 2018, 7-8 percent; and for 2019, 6.9-7.9 percent.

External developments were the primary reason for the slight downgrade in the growth goal for this year, especially the slowdown in China and the decline in the price of oil, Edillon said in a press conference following a meeting among representatives of the interagency Development Budget Coordination Committee.

As a result, the government has also cut its exports and imports growth targets to 5 percent (from 6 percent) and 10 percent (from 12 percent), respectively, based on the Bangko Sentral ng Pilipinas’ Balance of Payments and International Investment Position Manual projection.

As for challenges on the domestic front, Edillon cited the risks brought on by a prolonged dry spell due to the El Niño weather disturbance, although she noted that it was being addressed since the latter part of last year.

Budget Secretary Florencio B. Abad pointed out that, despite the external challenges, the economy continued to be more driven by domestic demand.

Edillon noted that domestic demand grew 8 percent last year, enabling the GDP to expand by 5.8 percent.