MANILA, Aug. 1 (PNA) -- The Philippines remains on track in meeting the lower-end of its full-year target of 6.5 percent to 7.5 percent gross domestic product (GDP) growth this year, making it still one of Asia’s fastest growing economies.
At a briefing on proposed 2018 national budget, Socioeconomic Planning Secretary Ernesto Pernia said the country’s real GDP growth so far remains respectable, recording a 6.4-percent growth in the first quarter.
He noted that meeting the mid-point of this year’s target, or 7 percent, will require an average quarterly growth of 7.2 percent for the next three quarters.
On the demand side, Pernia, also National Economic and Development Authority (NEDA), noted that household consumption is expected to remain strong due to consumer confidence and modest inflation.
“In fact, the lifting of quantitative restriction (QR) on rice, which will reduce the retail price of rice, will increase the purchasing power especially of the poor. Overall, tax reform is also expected to boost disposable incomes,” he said.
The NEDA has pushed for rice tariffication to make the staple more affordable, as import QR allowed by World Trade Organization (WTO) ended last June 30.
Pernia said investments would be supported by public construction, including infrastructure and reconstruction; private construction; the reduction in cost of doing business; and the proposed reduction in foreign investment restrictions.
“Exports should also improve with closer ASEAN economic integration; improving bilateral relations with China; and good prospects for BPM (business process management) and tourism,” he added.
On the supply-side, the NEDA chief pointed out that construction and infrastructure development could boost economic growth, which would be led by the “Build, Build, Build” program of the Duterte administration.
The projected public spending on infrastructure will reach PHP8.1 trillion for 2017 to 2022.
“The manufacturing resurgence is seen to continue given rising labor costs in neighboring countries,” he said. “International and domestic tourism will benefit from the improving bilateral relations with China and a growing middle class.”
The Philippine Development Plan (PDP) targets 7 to 8 percent GDP growth from 2018 to 2022.
“With GDP growth expected to strengthen further to 7-8 percent, the economy will expand by about 50 percent over the next six years,” added Pernia. (PNA)