Gov’t spending, polls seen to drive economy

MANILA, Philippines - The Philippine economy is poised to sustain its strong performance this year with the help of government spending and the national elections, Budget and Management Secretary Florencio Abad said.

He said state spending is expected to accelerate as government agencies continue to boost their absorptive capacities.

The different agencies have been putting in place reforms to improve their ability to implement their spending programs.

“The momentum in government spending will combine with the upcoming 2013 elections to spur growth,” Abad said.

Local and national elections will be held in May. An election year traditionally translates to an economic growth of at least seven percent.

The Aquino administration is eyeing growth of six to seven percent in 2013.

For 2012, the government expects economic growth to surpass the five- to six-percent range partly because of the improvement in state spending.

In the third quarter of last year, the Philippine economy grew 7.1 percent, surpassing expectations and beating the 3.2 percent recorded in the same period in 2011. The 7.1-percent growth brought the January to September average to 6.5 percent.

Meanwhile, as of end-November, expenditures climbed to P1.535 trillion, 14.1 percent above the P1.346 trillion disbursed a year ago and against the full-year program of P1.839 trillion.

Abad also said the November spending of P166.9 billion, which is 10.7 percent more than the P150.7-billion spent in November 2011, was the highest-spending month so far last year.