NATIONAL Economic and Development Authority (Neda) deputy director Dennis Arroyo said the government expects the country’s economic growth to go up in the coming months due to the strong election spending.
Arroyo, in a briefing at Malacanang, said they are maintaining a conservative target of 2.6 percent to 3.6 percent gross domestic product but “it can be and we’d likely revise it upwards.”
“Yes, in all likelihood, yes. We will probably revise it upwards. Although, for now, we’re being conservative given the unknown like the El Niño, we don’t know, say, what if it’s worse that we thought. In the same way that we were surprised by the Lehman Brothers, in the same way we were surprised by Ondoy and Pepeng. So that’s why in meantime we’re maintaining the 2.6 but, yes, it can be and we’d likely revise it upwards,” he added.
Arroyo cited that they are optimistic about the growth citing that in 2007, which was also an election year, the election spending contributed 0.24 percent to the GDP that year.
“But note that it’s based on the old elections, 2007, that was for senator, congressman, mayors, LGUs — not presidential elections. Now given this is presidential elections and there are more money being spent on presidential elections, we’ll have a bigger kick, a bigger impact, than 0.24 — so that’s one,” he said.
He declined to give any figure citing that it would have to go through the Development Budget Coordinating Committee (DBCC).
The Neda official admitted that the impact of the election spending maybe “temporary” but it would still be “substantial.”
He added that another factor is the expected boost the country’s growth is the ongoing reconstruction efforts as a result of the onslaught of typhoons Ondoy and Pepeng.
“The World Bank had added 0.4 due to reconstruction from the Ondoy and Pepeng because of all the reconstruction work that’s been added to the infrastructure spending and infra production. So it’s that—elections and construction,” Arroyo said. (JMR/Sunnex)