Government optimistic to meet growth goals

Sunday, December 18, 2011

THE Philippines’ chief economist has remained optimistic that government infrastructure funds to build roads, irrigation systems, and schools will help meet the five percent growth goal this year.

While buffeted by headwinds from the European debt crisis and the fragile recovery of trading partners, Socioeconomic Planning Secretary Cayetano Paderanga said the government’s catch-up spending plan is expected lift the economy in the fourth quarter.

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"For this year, growth will more or less be midpoint, but we’re hoping that we’ll hit the upper end of the assumption, given that government consumption has already caught to some extent," he told reporters late Thursday.

As of December 6, data from the Department of Budget and Management (DBM) show that it has already disbursed P61.28 billion, or 85 percent of the P72.11-billion Disbursement Acceleration Plan, which are economic stimulus funds, to various agencies.

Paderanga said that in addition to the already funded public works projects, the National Economic Development Authority (Neda) has already invited bidders to participate in big ticket public-private partnership projects.

At least one of those projects will be awarded before the end of the year after the Ayala Corp. on Thursday gained the government’s nod to build, operate, and maintain the four-kilometer Daang Hari-South Luzon Expressway (SLEx) Link Road.

The four-lane highway aims to connect Bacoor town in Cavite to SLEx near the Susana Heights interchange in Muntinlupa City.

Moreover, Paderanga said the plan to build a new airport in Bohol and the expansion of the airport in Puerto Princesa in Palawan is on track with pre-construction spadework being done by the Price Waterhouse Cooper, a global financial investment advising company.

Despite these developments, University of the Philippines economist Benjamin Diokno remained skeptical of the government’s moves to further boost the economy.

“I do not expect the Philippine economy to grow beyond four percent in the fourth quarter,” he said in an email.

Negative developments abroad and massive state under-spending pushed the government to abandon its lofty 7-8 percent growth target in 2011 in favor of a more conservative 4.5-5.5 percent forecast.

The economy grew only by 3.6 percent in the first three quarters of the year, lower than the 8.2 percent growth in the same period in 2010, an election year.

Paderanga said factors that will buoy the economy by early 2012 are holiday season spending, increased business and consumer confidence, and relatively stable macro-economy, among others. (Sunnex)