Government sticks to robust 7% growth outlook

MANILA, Philippines — The government remains firm on its commitment to achieve at least seven percent economic growth 2019, even as multilateral institutions adjusted downwards their global growth outlook, the Department of Finance (DOF) said yesterday.

In a speech during the Financial Executive Institute of the Philippines’ Inaugural Meeting and Induction Ceremonies, Finance Secretary Carlos Dominguez said the government has maintained its economic growth target of seven to eight percent this year even amid headwinds in the global economic landscape.

“We are still maintaining a seven percent GDP (gross domestic product) growth rate as a fighting target even as the major multilateral institutions have adjusted global growth projections,”Dominguez said.

“We are building on our own momentum and on the massive economic investments we have programmed for this year. We fully expect to be a growth leader in this dynamic region,” he added.

Multilateral institutions such as the International Monetary Fund and the World Bank have trimmed their global economic growth projections, citing the impact of trade tensions between US and China, the two largest economies in the world.

However, the finance chief expressed confidence that the Philippines would not be significantly affected by the global economic slowdown, given the amount of investments the Duterte administration is pouring into the development of the nation.

“First of all, we’re not really a big international trader. Of course, we are affected by the headwinds but because we have this Build Build Build program, we are sort of…quite insulated. And we have good credit, we have good tax collections, we are quite insulated,” Dominguez said.

He also said that “not enough credit is given to the no-nonsense leadership of President Duterte in making possible the new economic powerhouse that is the Philippine economy.

Dominguez assured finance executives during the event that the government is determined to push reforms that would bring about strong and inclusive economic growth for Filipinos.

Meanwhile, Budget Secretary Benjamin Diokno, citing Socioeconomic Planning Secretary Ernesto Pernia, said the country’s fourth quarter GDP growth is projected to settle within the neighborhood of seven percent.

“He’s hoping that the Q4 GDP will be in the neighborhood of seven percent. If we hit seven percent, that will make full year GDP at 6.5 percent, lower-end of revised target of 6.5 to 6.9 percent,” he said.

According to Diokno, economic expansion in the fourth quarter would have been driven by robust government spending and growth in the services sector.

He said the seven to eight percent growth target for 2019 is also “attainable” as big projects under the Duterte administration’s massive infrastructure program are expected to take off this year.

“Our big projects will take off this year, and also we have an election year. Usually during an election year, (there is a) 0.5 to one percentage point increase in GDP over and above the normal (growth),” he said.