Diokno: 2018, 2019 economic growth targets doable
MANILA, Philippines — The Philippines may hit its economic growth targets for 2018 and 2019, Budget Secretary Benjamin Diokno said Tuesday, even as he flagged agriculture’s lackluster performance as the “weakest link.”
In an interview with ANC, Diokno said the domestic economy may hit the low-end of the government’s downwardly revised 6.5-6.9 percent goal for 2018, and 7-8 percent growth target set in 2019.
While a full-blown trade war between the United States and China could prompt policymakers to adjust their macroeconomic assumptions, Diokno said the trade friction between the world’s two largest economies has “very minimal effect” to the Philippines.
“Our growth really is domestic driven: ‘Build, Build, Build’ and investment in human capital,” the Budget chief said, referring to the Duterte administration’s ambitious infrastructure plan.
“We’re not a big exporter,” he added.
Soaring prices and surging borrowing costs have already weighed on consumer spending, which has traditionally been the driving force behind growth in the Philippines, and crimped economic expansion to a three-year low of 6.1 percent in the third quarter.
Socioeconomic Planning Secretary Ernesto Pernia earlier said the economy would need to expand by at least 7.0 percent in the fourth quarter to attain the low-end of the government’s target for 2018.
According to Diokno, President Rodrigo Duterte “is very much aware that it is agriculture that is dragging the whole economy.”
Agriculture production has historically contributed about a tenth to gross domestic product and accounted for a fourth of employed persons.
“Because in the past agriculture can grow by about 2-3 percent. Now it’s 0.4 percent — in fact, sometimes, negative,” Diokno said, adding that Duterte has been “putting pressure” on Agriculture Secretary Emmanuel Piñol.
Farm output sank 0.83 percent in value terms in the third quarter last year, a reversal from 2.32 percent percent growth a year ago and the first contraction since the 1.11 percent drop recorded in 2016’s fourth quarter.
The Philippine Statistics Authority is scheduled to report the fourth quarter and full-year 2018 national accounts on January 24.
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