Faster GDP growth in H2 seen

The Duterte administration’s economic team is optimistic of reversing the slow 5.5-percent gross domestic product (GDP) growth in the first half as the government ramped up spending for the remainder of the year.

“The economy will have to expand by an average of at least 6.4 percent in the second half to reach the low end of the full-year growth target of 6-7 percent for 2019. The late approval of the 2019 budget which resulted in delays in the construction of some of the government’s key infrastructure projects that led to lower public spending sent a ripple effect throughout the various sectors of the economy. Nonetheless, generally positive sentiment remains toward the Philippine economy for the rest of the year,” the Cabinet-level, interagency Development Budget Coordination Committee (DBCC) said in its Sept. 30 midyear report on the 2019 national budget.

“Government expenditure is likely to increase in the second half of the year as it expedites the implementation of the government’s priority social development programs,” it added.

Citing the latest preliminary government spending data, the DBCC said “disbursements are gradually accelerating, and it is expected that the spending commitment of both the Department of Public Works and Highways and the Department of Transportation will drive disbursements for the rest of the year.”

To recall, President Duterte signed the P3.7-trillion 2019 budget just in mid-April as the two houses of Congress had squabbled over alleged “pork” funds.

As such, the government underspent about P1 billion per day from January to April as it used reenacted 2018 appropriations.