BSP: Central Luzon economy vibrant

CITY OF SAN FERNANDO -- Bangko Sentral ng Pilipinas (BSP) Monetary Board Member Alfredo Antonio and BSP Department of Economic Statistics Director Rosabel Guerrero said recently that Central Luzon's economy remains vibrant as it expanded by 9 percent last year, higher than the 4.4 percent growth posted in 2013.

u201cIn Region III, the economy expanded in real terms by nine percent in 2014, higher than the 4.4 percent growth in 2013. Regional growth was made possible largely by the expansion of the industry and agriculture sectors. Banking indicators likewise point to a sound financial system supportive of sustained economic growth in the region. Bank lending growth accelerated to 32 percent in end-2014---from 10.8 percent in end-2013---while savings deposits increased by 15.7 percent for the same period,” he said.

Guerrero, for her part, stressed that economic prospects in Central Luzon remain positive with various development indicators that include population and employment, economic growth and prices, financial resources, and business expectations pointing upward.

u201cIn terms of economic growth and prices, Central Luzon contributed 9.3 percent to the total national output in 2014 while at the same time registering the highest economic growth at nine percent for the same year,” she said, adding that the region contributed 6.3 percent of the national total in the services sector.

Guerrero further said that unemployment in Central declined while the percentage of underemployment increased this year, translating to 22.3 percent of the labor force who are looking for work which is a slightly higher than 22.1 percent recorded in April 2014.

Central Luzon also posted an accelerated growth rate in the industry sector and in the agricultural, hunting, forestry and fishing sector at 16.1 percent and 5.9 percent, respectively.

u201cA decrease in inflation was observed in Central Luzon brought about by the negative annual rates in the indices of housing, water, electricity, gas and other fuels and transport as well as the slower mark ups in food and non-alcoholic beverages, furnishing, household equipment and routine maintenance of the house, health and education,” Guerrero said.

She noted that in the latest BSP survey, Central Luzon respondents in particular expected inflation rate to settle at 3.27 percent in the second quarter and at 3.35 percent for the third quarter of 2015.

In terms of banking, Guerrero said: “Lending activity and deposit generation also continue to grow at double digit rates in the region in 2014. It posted 15.8 percent growth in deposit generation, while the loans to deposit ratio was pegged at 30.7 percent in 2014 or an increment of 3.8 percentage points compared to its previous year.”

She said the improvement translates to more capital to fund economic expansion in Central Luzon with more bank branches, higher bank savings deposits, and increasing loans granted by banks.

Guerrero emphasized that business confidence in Central Luzon remains favorable. (JTD/Sun.Star Pampanga)

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