‘Philippines can achieve 7-9 percent GDP growth if...’

MANILA, Philippines — The Philippine economy can grow by seven to nine percent if the country can minimize or bring its trade deficit to zero, according to an economics professor.

In an interview with “The Chiefs” on One News on Monday night, University of Asia and the Pacific economics professor Ronilo Balbieran answered in the affirmative when asked if a seven to nine percent gross domestic product (GDP) growth is achievable for the Philippines.

Balbieran said achieving this GDP growth level would be possible if the country “can bring the trade deficit to zero.”

While the country is receiving dollars from overseas Filipino workers and Filipino companies abroad, he said these are being used for imports.

Latest trade data from the Philippine Statistics Authority showed the balance of trade in goods or the difference between the value of exports and imports amounted to a $4.4-billion deficit in May, down from the $5.56-billion shortfall in the same month last year and the $4.84-billion gap in April.

For the January to May period, the country’s trade deficit amounted to $23.99 billion, wider than the $23.96 billion in the same period a year ago.

The government has set a six to seven percent growth target for this year.

For next year until 2028, the government is aiming to see the economy grow by 6.5 to eight percent.

In the first quarter, the economy grew by 6.4 percent, slower than the eight percent growth posted in the first quarter last year, and the 7.1 percent expansion in the previous quarter.

Last year, the economy posted a 7.6 percent GDP growth.

Rizal Commercial Banking Corp. chief economist Michael Ricafort said the economy could grow by at least six percent or even more in the foreseeable future if it could harness its potential.

He said even before the pandemic, some of the major global banks see the Philippines as becoming one of the biggest economies by 2050 because of the country’s demographic sweet spot, with the majority of the population in the working age bracket.

To harness the country’s potential, Ricafort said intervention measures on education would be important.

“Education is the biggest equalizer. Many people would be lifted out of poverty once they are educated,” he said.