‘Rising poverty remains a hindrance to growth’

MANILA, Philippines — The increase in self-rated poor families is seen as a major challenge to the country’s economic growth, making it necessary for the government to focus resources in areas where poverty is prevalent, according to think tank GlobalSource Partners.

In a brief, former Bangko Sentral ng Pilipinas deputy governor Diwa Guinigundo, country analyst for the Philippines at GlobalSource, said the number of self-rated poor families rose despite the 5.9 percent growth posted by the economy in the third quarter.

He said this “is a big challenge that economic expansion will need to be further accelerated.”

Citing the third quarter Social Weather Stations survey conducted from Sept. 28 to Oct. 1 this year, he said the results showed 48 percent of Filipino families felt poor, up from 45 percent in June 2023.

This translates to 13.2 million self-rated poor families, 5.6 percent higher than the 12.5 million in June 2023.

“Based on the survey, the increase in the number of self-rated poor families is driven more by sustained high inflation than the labor market dynamics, particularly in food and transportation costs,” Guinigundo said.

He said the increase in food prices, however, does not seem to be supported by the survey results, which showed the percentage of food-poor families still at 34 percent compared to June 2023.

Aside from inflation, he said limited job opportunities could also explain the survey results.

While labor officials recognize the usefulness of the survey results, particularly in directing their programs to areas and communities where poverty is most prevalent, Guinigundo said the bigger challenge is for other government agencies like those in charge of agriculture, trade and industry, and infrastructure to turn their focus to these areas.

“They need to concentrate the use of public money to directly addressing those structural imbalances that prevent a more significant breakthrough in poverty alleviation after all these years,” he said.

The Philippine economy grew by 5.5 percent in the January to September period

To meet the low end of the government’s six to seven percent growth target for this year, National Economic and Development Authority Secretary Arsenio Balisacan earlier said the economy would need to grow by 7.2 percent in the current quarter.