Biz groups see better year ahead

MANILA, Philippines - Business groups are upbeat the economy will grow at a much faster pace this year compared to the 6.1-percent uptick posted last year, citing the Public-Private Partnership (PPP) projects to be rolled out and other construction activities to be undertaken.

The Philippine Statistics Authority reported yesterday that the Philippine economy grew 6.9 percent in the fourth quarter, which brought the full-year 2014 result to 6.1 percent.

The full-year 2014 gross domestic product (GDP) growth is lower than the government’s target of 6.5 to 7.5 percent for last year, and the 7.2-percent expansion posted last year.

While the growth target for last year was missed, business groups expect the economy to have a better showing this year.

“For this year, we are still looking at 6.5- percent growth and up. First of all, because of government’s higher expenditure on infrastructure and the PPP projects,” Philippine Chamber of Commerce and Industry president Alfredo Yao said in a telephone interview.

He also said exports and local consumption are seen to support stronger economic growth this year.

Makati Business Club executive director Peter Perfecto said in a text message the latest GDP result, which is broad-based, lays the foundation for more robust growth this year.

“With our hosting of APEC (Asia Pacific Economic Cooperation),  the expected increase in public and private construction, which actually rebounded in fourth quarter 2014, will be able to greatly assist in attaining our yearend goal of around seven percent,” he said.

He added that the most expensive PPP projects, which would be bidded out and awarded this year, are also seen as economic growth drivers.

Apart from infrastructure projects, Semiconductor and Electronics Industries in the Philippines, Inc. president Dan Lachica said in a text message he expects other major economic growth drivers such as power availability, peace and order, a stable peso, favorable business climate and political positioning for 2016 elections.

Meanwhile, American Chamber of Commerce of the Philippines senior advisor John Forbes said in a text message the Philippines, which has been growing more slowly than it ought to be, could grow by nine to 10 percent, if more reforms are undertaken to build much more infrastructure, solve property rights issues, reduce the price of rice and power, enable responsible mining and revive the agricultural sector where much of the labor force works.

“The private sector is doing its part as seen by the strong growth in manufacturing and construction. The public sector, while better, is not doing enough by underspending and overregulating,” he said.

While Trade Secretary Gregory Domingo did not give a forecast on how fast the economy is expected to grow this year, he told reporters the Philippine economy would benefit from declining oil prices.

“The primary effect of reduction of oil prices is it will boost consumer spending,” he said, noting that consumers would have more disposable income.