Sustained robust growth last year likely reduced poverty incidence in the country although expectations of higher inflation this year posed risk to the government’s program to slash the number of poor Filipinos to 14 percent of the population by 2022, the National Economic and Development Authority said.
“Poverty incidence is yet to be determined, results are expected in early 2019. There are indications that the 2017 numbers are better than in 2015, given the sustained economic growth and the moderate food inflation (3.8 percent for 2017),” state planning agency Neda said in its Socioeconomic Report 2017 released last week.
Under the Philippine Development Plan 2017-2022, the government wanted to keep food inflation stable or within the range of 2-4 percent in the medium term.
The food inflation rate last year, however, was higher than the 2.6 percent in 2016.
The poverty incidence rate stood at 21.6 percent in 2015, and the Duterte administration aims to cut it by over seven percentage points four years from now through its 10-point socioeconomic agenda.
The gross domestic product expanded 6.7 percent last year, among the fastest in the region.
The government targets a faster 7-8 percent growth yearly from 2018 to 2022.
The next poverty incidence data will be available in 2019, as the Philippine Statistics Authority’s Family Income and Expenditure Survey will be held next year.
However, Neda said the goal to reduce poverty incidence “may be at risk in 2018, if inflationary pressures are not addressed effectively and immediately.”
Last week, the Bangko Sentral ng Pilipinas raised its inflation forecast for 2018 to 3.9 percent from 3.8 previously, citing expectation of higher global oil and rice prices.
The BSP had also projected a faster rate of increase in prices of basic goods this year due to the impact on consumer prices of the Duterte administration’s first tax reform package.
The Tax Reform for Acceleration and Inclusion (TRAIN) Act starting Jan. 1 this year jacked up or slapped new excise taxes on such products as oil, cigarettes, sugary drinks and vehicles.