5.5% growth this year still possible - Paderanga

MANILA, Philippines - The Philippine economy may still grow by 5.5 percent this year, which is the upper end of the government’s official forecast of 4.5 percent to 5.5 percent, Socioeconomic Planning Secretary Cayetano Paderanga Jr. said on Thursday.

“We still have a good chance of meeting the upper end of the projection,” he said in a yearend briefing.

Estimates from the National Economic and Development Authority (NEDA) showed that the economy in the fourth quarter of the year has to expand by 7.8 percent for full-year growth to hit 5.5 percent.

 Paderanga said that while the trend shows that economic growth for 2011 may hit the mid-point which is roughly five percent, the high-end may still achieved given the plan to boost spending.

“We’re hoping our catch-up program has finally become on track,” he told reporters yesterday.

The Aquino administration’s under-spending has been blamed for the lackluster economic growth.

As such, the government approved a P72-billion Disbursement Acceleration Package, or what it calls a stimulus program but is actually the amount of disbursements it has earlier programmed.

However, Paderanga said there are also global risks that could dampen growth.

“The downside risks are the evolving global environment,” he said, referring to the financial woes in the United States and the Eurozone.

He also said that the impact of the tsunami in Japan lingered longer than expected and made worst by the recent floods in Thailand.

These disasters dampened the country’s export growth,” Paderanga said.

For 2012, Paderanga said the economy is expected to hit the five percent to six percent target for next year.

He hopes that there would be improvement in the external environment and that the spending would improve significantly.

“We would like to see some pleasant events,” he said.

Under spending by the government and global uncertainties continued to drag economic growth in the third quarter, with gross domestic product (GDP) expanding by only 3.2 percent from the 7.3 percent honey moon growth a year ago and from the revised 3.1 percent recorded in the second quarter of the year, latest data from National Statistical Coordination Board (NSCB) showed.

The third quarter economic performance brought GDP growth in the first nine months of the year to 3.6 percent.