PNoy CONFIDENT PH ECONOMY WILL GROW 5-6% THIS
YEAR
MANILA, SEPTEMBER 14, 2012 (ABS-CBN)
President Aquino is confident the Philippine economy can grow 5 to 6% this
year. He says higher government spending and foreign investments will help the
country achieve that target.
[VIDEO FROM ABS-CBN NEWS]
REPORTED IN MAY 2, 2012
-INQUIRER
Philippine economy to grow by 5-6%, say officials ADB: No
serious effect of recession in Europe By Michelle V. Remo, Riza
Olchondra Philippine Daily Inquirer 12:04 am | Thursday, May 3rd, 2012
[PHOTO -OPTIMISM Haruhiko Kuroda, ADB president, speaks of continued
Asian growth during a press conference of the 45th ADB Board of Governors'
meeting on Wednesday. RAFFY LERMA]
Administration officials are optimistic that the Philippine economy will
expand by 5 to 6 percent in 2012, higher than the 3.7-percent growth posted in
2011.
Socioeconomic Planning Secretary Cayetano W. Paderanga Jr. told reporters on
the sidelines of the 45th Asian Development Bank governors' annual meeting in
Manila that the government's expenditures program was getting on track and
economic indicators were looking "good."
ADB president Haruhiko Kuroda said the Philippines and its neighbors were
poised to weather the effects of a mild recession in the Euro zone this year,
but stressed the urgent need for member-countries to address the wide income
inequality in their jurisdictions.
Kuroda said the crisis in the Euro zone was not expected to cause a
significant drag on growth rates of Asian economies and on remittances that
countries like the Philippines receive.
"We expect a rosier 5 to 6 percent GDP growth for 2012" not only because of
"strong spending" but also because of the government's "strong resolve on good
governance," Public Works Secretary Rogelio L. Singson said.
GDP or gross domestic product is the value of goods produced and services
rendered in the country in a given period. It excludes remittances by overseas
Filipino workers and earnings of Philippine firms abroad.
Singson enumerated other signs of economic improvement:
Good performance of the Philippine Stock Exchange which had seen more than 17
record closing highs since January.
A banking system that is "one of the healthiest in Southeast Asia."
Rating upgrades from international rating agencies.
Strong foreign exchange reserves and overseas remittances.
Growing domestic consumption.
Business confidence
These strengthen business confidence in and provide "strong international
support" for the Philippines, especially for its public-private partnership
(PPP) program, said Paderanga and Singson.
Cosette V. Canilao, PPP Center executive director, said four projects were
recently submitted to the National Economic and Development Authority for review
and more projects were in the pipeline.
She said the Australian Agency for International Development had committed
additional funding, bigger than the $7 million allotted last year, to support
the PPPs through a grant administered by ADB.
An additional $9 million will augment the PPP Center's Project Development
and Monitoring Fund, a revolving fund to finance pre-investment studies of
selected project proposals, Canilao said.
Recovery in exports
ADB country director Neeraj Jain, in a separate briefing, noted "some
recovery" in exports after the 7-percent decline last year.
Jain said the Philippine government would do well to consider diversifying
products (which has been semiconductor-heavy) and markets (more around Asia
rather than industrialized Western markets).
Optimism in the first quarter came from accelerated public works and signs of
exports recovery, Paderanga said. He said the GDP growth of 5.5 percent in the
first three months was within range.
The country's top economist said this level of growth may be sustainable
throughout the year if government spending, the main growth driver this year,
continued on an accelerated pace as in the first few months.
Augusto M. Cosio, president of First Metro Asset Management Inc., also said
the domestic economy would likely grow by 5.5 percent in the first quarter,
citing similar reasons mentioned by Singson and Paderanga.
Slow government spending and sluggish global trade resulted in a 4.6-percent
GDP growth in the first quarter of 2011.
The Philippine economy must grow by 7 to 8 percent annually to generate
enough employment and income opportunities for a larger number of Filipinos,
according to the Philippine Development Plan 2010-2016. It has consistently
grown over the years, managing to expand its economy even at the height of the
latest global crisis in 2009 when many countries fell into recession.
However, economic growth has failed to pull people out of poverty. Poverty
incidence in the country stood at 26.5 percent as of 2009, up from 26.4 percent
in 2006 and 24.4 percent in 2003.
Wide disparity of incomes
Economic growth becomes meaningful when it leads to poverty reduction, and
when income distribution becomes closer to being perfectly even, according to
Kuroda.
"The Asia Pacific region should be able to maintain its growth momentum
despite the ongoing troubles elsewhere in the world," the ADB head said.
"However … the benefits of growth have yet to reach several hundreds of
millions of Asians who continue to struggle on less than $1.25 a day," Kuroda
said.
Ironically, key factors for Asia's economic development—technological
advancement, globalization, and market-oriented reforms—were also the cause of
the wide disparity of incomes in Asian countries.
This is because such developments make it difficult for the poor, both
individuals and micro enterprises, to compete in labor and capital markets,
respectively.
Technology, liberalization
Nonetheless, Kuroda said Asian countries should continue pursuing further
advancements in technology, globalization and market liberalization, given their
ability to boost overall economic growth.
"While these economic trends cannot and should not be reversed, it is
critical that they be counterbalanced by policies that will make growth in the
[Asian] region more inclusive," he said.
These policies may include higher investments in public education and
infrastructure.
Sending more poor children to school will give them better employment
opportunities in the future, while heavier investments in infrastructure can
attract more enterprises to do business in a country and thus create more
employment, he said.
Governor Amando Tetangco Jr. of the Bangko Sentral ng Pilipinas agreed with
Kuroda that the Philippines would continue posting a decent economic growth this
year even if the Euro zone suffered from a mild recession.
Domestic consumption
Because the Philippine economy relies more heavily on domestic consumption
than exports, it can manage to grow even if exports to the Euro zone become
anemic, Tetangco said.
He said the crisis in the Euro zone would have a minimal impact on
remittances of OFWs because they can be found in many countries and industries.
"We maintain our projection of a 5-percent growth in remittances to the
Philippines this year," Tetangco said. Last year, remittances reached $20.1
billion.
Originally posted at 01:20 pm | Wednesday, May 02,
2012
Chief News Editor: Sol Jose Vanzi
© Copyright, 2012 by PHILIPPINE HEADLINE NEWS ONLINE
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