1.8% this year, Development Budget Coordination Committee (DBCC) Chairman
and Budget Secretary Rolando Andaya Jr. announced on Wednesday. The DBCC
also agreed to revise the GNP growth target to 2.1-3.1%.
Socioeconomic Planning Secretary Ralph Recto said that economic managers
revisited the growth numbers on account of the larger impact of the global
crisis on the domestic economy, particularly on consumption and
investments. "Nonetheless, we remain confident that the Philippine economy
will maintain a positive growth this year."
"Uncertain global economic conditions may have cramped consumer sentiment.
While OFW remittances have continued to increase, it appears that a large
portion of the increase went to savings than consumption," Bangko Sentral
ng Pilipinas (BSP) Deputy Governor Diwa Guinigundo said.
Personal consumption which accounts for some 75% of GDP grew by 0.8% in the
first quarter of 2009.
"However, the domestic economy is now gaining more traction as reflected in
some initial demand data and as government spending accelerates," Secretary
Ralph Recto said.
Finance Secretary Gary Teves said that the revised growth target will
result in a budget deficit of P250 billion or 3.2% of GDP this year from
the earlier deficit ceiling of P199.2 billion or 2.5% of GDP.
"Despite the adverse impact of the lower growth on our revenue collection,
we are keeping our level of spending to help us sustain modest economic
growth," Secretary Teves said.
Secretary Recto said the Philippines remains a growth story because we made
tough economic decisions early on.
"We have followed these up with appropriate economic policies that have
enabled us to show positive growth amid the global economic downturn," he
Secretary Andaya said various government initiatives under the Economic
Resiliency Plan (ERP) have created more than 500,000 new jobs that will
help us continue to sustain growth.
Deputy Governor Guinigundo reiterated that the monetary authorities will
continue to ensure the availability of liquidity in the market consistent
with non-inflationary growth.