GOVERNMENT committed to pour more into infrastructure and social services this year to drive economic growth, as it shifts to a “less debt-focused, more growth-oriented” spending plan, one of President Arroyo’s economic managers said yesterday.
Budget Secretary Rolando Andaya Jr., in a briefing yesterday morning for Cebu’s business community, said that the government intends to clip interest payments, from 28.3 percent of the budget in 2007 (P318.2 billion) to only 24.1 percent this year (P295.8 billion).
President Arroyo signed Tuesday the annual budget that includes a P20-billion increase in funds earmarked for roads and bridges, an additional P2 billion to build schools and P2.9 billion more for irrigation and post-harvest facilities.
“We have turned the corner,” Andaya said. “We’re armed with more funds to do things.”
Spending in key areas is projected to increase this year by at least P24.7 billion in infrastructure, P8.4 billion in education and P4.2 billion in health, he added.
Lower deficit
Buoyed up by a stronger peso, the Arroyo administration reined in the National Government’s deficit to P9.4 billion last year, the lowest on record since 1986.
For Central Visayas in 2008, the National Economic Development Authority (Neda) expects tourism and the information and communications technology (ICT) sectors to keep boosting economic growth, said Regional Director Marlene Rodriguez.
Increased activity in these sectors will “benefit downstream industries like real estate and construction, retail trade and transportation,” she said in her presentation.
The Neda also projects an expansion in the region’s banking industry and a boost to mining when copper production at the Atlas mines resumes by the third quarter this year, Rodriguez added.
During the open forum, however, Rodriguez admitted it will take double-digit growth in the gross domestic product (GDP)-or the total value of goods and services produced within the country’s borders-for more Filipinos to haul themselves over the poverty line.
Economic services
Tight credit for agribusiness and the continued loss of skilled workers to jobs abroad, from butchers and welders to air traffic controllers and doctors, surfaced among the issues the Cebu business community worries about.
The administration expects this year to spend more on economic services, for which it has allotted 23.4 percent of the budget, from last year’s 21.5 percent. Social services will get the largest slice of the pie, at 30.1 percent, up from 28.4 percent last year.
Among the social service expenditures programmed for this year are P181 billion for education, P22.8 billion for health, P69.1 billion for welfare and social security, P7.6 billion for housing and P4.1 billion for land distribution.
After years of pruning expenses, “increased public spending is the growth catalyst for 2008, and infrastructure and social services are priority sectors for accelerated spending,” Andaya said.
In 2007, infrastructure spending accounted for 2.1 percent of GDP, which is higher than the 2006 level but still below the World Bank’s benchmark of five percent, Andaya said.
After the briefings in Davao and Bohol, the administration’s economic managers are scheduled to bring their yearend economic briefing to Iloilo, Naga and Clark. (IDA)
