Philippine economic growth for the first quarter may speed up from the 4.6 percent in the corresponding quarter in 2011.
Economic Planning Secretary Cayetano Paderanga Jr. told reporters that a growth of 5 to 7 percent was possible for the first quarter this year with more government spending and private consumption. Paderanga is also director-general of the National Economic and Development Authority (NEDA).
“The government expenditure program is really working well but of course there are some downside risks and we’re watching what’s happening in Europe, and then of course the oil issue,” Paderanga said. “The government expenditure program has already kicked in starting in the fourth quarter so at least we will feel the effects of that [this year].”
For the entire 2012, the economy could grow “at least 5 percent,” Paderanga said. The aspirational 7- to 8-percent average growth a year set in the Philippine medium-term plan was also possible but might be difficult, Paderanga said.
NEDA assistant director-general Ruperto P. Majuca told reporters that reconstruction efforts and assistance for tropical storm “Sendong” victims would also contribute positively to the economy.
Business confidence and industry efforts to boost electronic exports through product and market diversification as well as the sustained robustness of the services sector are also seen as growth drivers this year.
“I think there’s a good chance that it will be [higher than 4.6 percent]. I see that the possible drivers will be public construction, the ramping up of public expenditures [and] also in general there’s a high [level of] business confidence. This is reflected, among others, in the stock market performance. So this confidence will tend to stimulate business activity, investment and then it would have a positive impact overall,” Majuca said.
Majuca said the Semiconductor Industry Association and the Semiconductor and Electronics Industries of the Philippines Inc. have reported that they expected “robust growth rate” in exports this year. Majuca said the government was working with the private sector to try to diversify exports and move manufacturers to make higher-value products.
As for full-year growth, 7 percent “will be fairly difficult” considering the slowdown in global economic environment, which hampers exports, Majuca said.