GDP seen to grow faster this year
Mary Grace Padin (The Philippine Star) - January 24, 2018 - 12:00am

MANILA, Philippines — The Philippine economy is expected to grow faster in 2018 due to the implementation of the tax reform law, which will pave the way for the rollout of infrastructure projects and translate to higher consumer spending, according to the Department of Finance (DOF).

In a statement, Finance Secretary Carlos Dominguez said the economy may expand faster this year as the government’s economic programs start to take effect.

“As I said last year, there will be a more exciting growth narrative for the Philippines this 2018, more so now that all of the government’s plans to keep the country among the world’s fastest-growing economies have started falling into place,” he said.

For one, Dominguez said the Duterte administration has been able to implement the Tax Reform for Acceleration and Inclusion Act, which contains Package 1A of the Comprehensive Tax Reform Program (CTRP).

Dominguez said this, in addition to the government’s recent issuance of $2 billion worth of global bonds and President Duterte’s foreign policy rebalancing toward Asia, ensures steady revenue flow that would help bankroll the government’s public infrastructure program.

“These developments, which attest to President Duterte’s unwavering political resolve to effect real positive change and the corollary strong investor confidence in the domestic economy on his watch, would guarantee enough fiscal space to let government continue pursuing an expansion policy leading to nonstop, high and inclusive growth,” Dominguez said.

Moreover, Dominguez said the personal income tax (PIT) cuts under the TRAIN law would increase the take-home pay of Filipinos, therefore boosting consumer spending and further driving economic activity.

To complement these developments, Dominguez said the government now has a better absorptive capacity, which would lead to the faster release and appropriate use of public funds.

Citing data from the Department of Budget and Management, Dominguez said infrastructure disbursements in November 2017 jumped 44.8 percent to P43.8 billion.

He said the government is also set this year to reduce the Foreign Investment Negative List (FINL) and fasttrack measures to cut red tape and improve the ease of doing business in a bid to attract more foreign direct investment flows and further stimulate economic activity.

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