A STIMULUS PACKAGE expected to allow the government to meet this year’s growth goals will be unveiled today and will include funding for various infrastructure projects and social services, Malacañang yesterday said.
“[President Benigno S.C. Aquino III] will announce the details of the package tomorrow,” Palace Spokesperson Edwin Lacierda told reporters, referring to a scheduled speech before the Foreign Correspondents Association of the Philippines.
Malacañang earlier said that Mr. Aquino had approved the stimulus package “in principle” on Monday to help spur growth, especially as the government has decided to retain its macroeconomic targets despite market turmoil abroad and the havoc caused by recent typhoons.
The government is aiming for 7-8% gross domestic product (GDP) growth for 2011 and 2012. Lower ranges of 5-6% for this year and 5.5-6.5% for next year were also used for budgeting purposes.
Growth was only 4% in the first semester, and economic managers are hoping the stimulus package will bring the full-year result closer to the assumptions used in the budget plans.
Details of the stimulus remain scant. Unconfirmed reports have placed the cost at P72 billion to as much as P90 billion, with the funds to be primarily sourced from savings.
Budget Secretary Florencio B. Abad, in a text message, yesterday said Mr. Aquino had approved additional spending for national and rural infrastructure, rural electrification, agricultural and fisheries development, transportation and job training.
The stimulus package will also finance social services like mass housing, education and medical services. Some funds will be used to settle national government obligations and for peace building in the Autonomous Region in Muslim Mindanao, Mr. Abad added.
Part of the package will also go to local government units (LGUs), especially after they suffered a decrease in their internal revenue allotments for this year.
“We will establish an LGU Support Fund worth… roughly P6.5 billion,” Mr. Aquino said in a speech marking the anniversary of the Local Government Code yesterday. Mr. Lacierda confirmed that the LGU Support Fund formed part of the stimulus.
The funds will go to capital outlay and not personal services or maintenance expenses, Local Government Secretary Jesse M. Robredo told reporters.
“This is project assistance, meaning the money will have a direct impact on the lives of beneficiaries instead of using this for salaries of employees,” Mr. Robredo said.
“The fund will prioritize projects like arterial national roads and local roads, anything that promotes agricultural productivity and anything that promotes local enterprise development,” he added.
In a text message, Budget Undersecretary Laura B. Pascua said “We are targeting the fast release of the funds in the spending program so it will have an impact this year as well as next year.”
The stimulus package, she added, is expected to drive economic activity in the remaining months of the year and the first quarter of 2012.
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By: Diane Claire J. Jiao
Source: Business World, Oct. 12, 2011
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