Palace: Poverty down, economy up

Malacañang painted a rosy picture of the economy yesterday, saying poverty is declining and investments are up despite the latest surveys showing that hunger among Filipinos was hitting record highs.

At Malacañang, Nestor Mijares, National Economic Development Authority deputy director general, gave a briefing presented earlier to President Arroyo and the entire Cabinet that also showed the country’s deficit levels were heading down while currency reserves were at a record high.

The presentation came as economic managers met with officials of Standard & Poor’s rating seeking a possible upgrade in the country’s credit rating.

"Poverty is subsiding," Mijares said. "Between 2000 and 2003, poverty incidence or the proportion of the poor declined from 33 percent to 30.4 percent among population and from 27.5 percent to 24.7 percent among families."

He said those at the subsistence level, or living just above poverty, had also declined, reaching 13.8 and 10.4 percent among populations and families, respectively.

"Apart from economic growth, the improvement in poverty condition is attributed to the government’s successful efforts in controlling prices of commodities purchased by the poor and the improved distribution of household income during the same period (2000-2003)," he said.

Mijares said the country’s annual per capita poverty threshold reached P12,475 in 2003, up by 7.1 percent compared to the 2000 level of P11,451.

Thus, a family of five should have an income of at least P5,111 a month to be able to sustain their minimum basic needs, he added.

Mijares said the annual per capita food threshold increased from P7,707 in 2000 to P8,134, up by 5.5 percent during the period.

Since 2001, the national government deficit has been reduced to manageable levels or from a high of 5.3 percent of Gross Domestic Product (GDP) or P210.7 billion in 2002, down to 2.7 percent of GDP or P146.8 billion in 2005, he added.

Mijares said net foreign direct investments in 2005 amounted to $1.1 billion, exceeding the projected level of $971 million. Foreign portfolio investments for the full year last year resulted in a net inflow of $3.99 billion.

Tourist arrivals for the first quarter of the year exceeded 700,000, indicating that a full-year target of 3.07 million visitors with $22.98 billion in receipts and 3.74 million employment generated would be met, he added.

The latest survey of the Social Weather Stations (SWS) released earlier this month showed that the percentage of households reporting having experienced hunger, "with nothing to eat at least once in the past three months," had reached a new record high of 16.9 percent in March 2006, equivalent to 2.8 million families and surpassing the previous peak of 16.7 percent in December 2005.

"Severe Hunger," defined as families going hungry "often or always" in the last three months, was at 4.2 percent in March 2006, or almost 700,000 families, the SWS said.