THE National Economic and Development Authority (Neda) is reviewing the government’s “aspirational” target of 7 percent to 8 percent this year following the low and disappointing second-quarter growth figure of 3.4 percent, Malacañang said on Tuesday.
Secretary Ramon Carandang of the Presidential Communications Development and Strategic Planning Office also said in a news briefing that the government remains convinced that its assumed 5-percent to 6-percent growth target in the 2011 budget is “still doable.”
He issued the statement in response to the decision of Hongkong and Shanghai Banking Corp. (HSBC) to cut its growth forecast for the Philippines to 4.3 percent from 5.2 percent due to a slowdown in exports.
Asked if the government will recast its growth forecast for the year, Carandang said: “I understand that because of the second quarter economic figures, Neda is reviewing the fighting target [of ] 7 percent to 8 percent…because of the second quarter low growth figure.” He added, however, that in terms of the budgetary assumption of 5-percent to 6-percent growth target this year, “we’re still more or less within that target.
“I think that [5 percent to 6 percent] is still a doable target,” Carandang said, noting that the government spending is expected to accelerate in the second semester.
He explained that the slowdown in the first half of the year—4.9 percent in the first quarter and 3.4 percent in the second quarter—was due to the government underspending but Budget Secretary Florencio Abad “has assured us that that spending has begun to accelerate.”
“When you see an economic slowdown, globally as what we’re seeing now, normal government fiscal response will be accelerated spending and that’s exactly what we’ve been doing since July. So, at least as far as the government stimulus is concerned, we believe that that’s on track now,” Carandang said.
He added that external factors “are already having an impact on our growth prospects which is why the Neda is reviewing the growth targets.”
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By: Mia M. Gonzalez
Source: Business Mirror, Sept. 6, 2011
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