Government sets 7%-8% growth target this year

MANILA, Philippines -  The Aquino administration will still strive to attain the seven percent to eight percent economic growth target this year by accelerating state spending, Finance Secretary Cesar Purisima said yesterday.

“The seven percent to eight percent is an aspiration. We continue to aim for seven percent to eight percent. We will invest in the necessary infrastructure,” Purisima told reporters.

Purisima said government economic managers are now eyeing measures to boost spending by identifying bottlenecks in the disbursement of funds.

Purisima said that with strong agriculture growth in the first quarter, the performance of the economy may be stronger than in the first three months of the year.

“With the good performance of agriculture, growth for the year may be higher than 4.9 percent,” he said. 

The Philippine economy, as measured by gross domestic product (GDP) posted a slower growth rate of 4.9 percent in the first quarter of the year which statisticians attributed to slower government spending and a slowdown in global trade.

The 4.9 percent growth is significantly slower than the 8.4 percent recorded in the same period last year, which on the other hand, was driven by strong election spending.

On the fiscal side, Purisima said the Aquino administration would try to contain this year’s budget deficit at 3.2 percent of GDP despite the slower economic growth recorded in the first quarter of the year.

“It’s still at 3.2 percent of GDP,” the Finance chief noted when asked if the Finance department would be recommending a revision in this year’s budget deficit ceiling.

The government has set a deficit ceiling of P290 billion or 3.2 percent of GDP for the year. This is lower than last year’s actual budget gap of P314.4 billion or 3.7 percent of economic output.