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Friday, March 29, 2024

Economic managers to keep 7% growth target

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The government is expected to keep the 7-percent growth target for 2016 to enable the Philippines to become a high-income country by 2040, the National Economic and Development Authority said Thursday.

Economic Planning Secretary and Neda director-general Arsenio Balisacan said while the inter-agency Development Budget Coordination Committee would revisit the growth target within the month, he would like to keep the 7-percent gross domestic product growth target.

“[The DBCC] should meet this month because we will need that for the next cycle of the budget,” Balisacan said.

The DBCC is composed of the Finance Department, Bangko Sentral ng Pilipinas, Budget Department, Office of the President and Neda.

“I’d like to see that we keep our target of 7 percent because with 7 percent, you have more and higher chances of getting there in 2040.  We will achieve high income level in one generation,” Balisacan said. 

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“But if you go back to the old [growth] trajectory of 5 percent or 4 percent, when will we achieve that? The [target should be] in one generation.  We’ll be a high-income country also, just like the Singaporeans and Taiwanese. Everyone around us has done that and there’s no reason why we cannot,” Balisacan said.

The economy grew 5 percent in the first quarter, 5.7 percent in the second quarter and 6 percent in the third quarter.  This brought average growth in the nine months period to 5.6 percent. 

Economists said to hit the lower end of the government’s growth target of 7 percent to 8 percent in 2015, the economy should grow around 7.3 percent in the fourth quarter.

The Philippine Statistics Authority will release the fourth-quarter numbers on Jan. 28.

The International Monetary Fund said the Philippine economy likely grew 5.7 percent last year and was expected to rebound with a more than 6-percent expansion in 2016 and 2017.

IMF resident representative to the Philippines Shanaka Jayanath Peiris said while the multilateral lender slightly slightly reduced the growth forecasts for the Philippines, the country would remain one of the fastest growing in Asia.

“The growth estimate for 2015 was revised down to 5.7 percent from 6 percent, reflecting growth outturns in the third quarter and weaker global growth performance,” Peiris said in an e-mailed statement.

The IMF estimate is below the government’s growth target of 7 percent to 8 percent for 2015 and lower than the actual GDP expansion of 6.1 percent in 2014 and 7.1 percent in 2013.  The government will release the official 2015 growth figures later this month.

IMF also cut the growth forecast for 2016 to 6.2 percent from the previous estimate of 6.3 percent, due to external headwinds.

“The Philippines growth outlook remains one of the strongest in the region. Despite the weaker global economic outlook, the Philippines growth forecast for 2016 was only marginally lowered from 6.3 to 6.2 percent to reflect the more challenging external environment,” he said.

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