By Chino S. Leyco
The Department of Finance (DOF) said yesterday that an economic growth of at least six percent in the first three-months is considerably good considering the unfavorable conditions that happened during the quarter.
Finance Secretary Carlos G. Dominguez III said he is being conservative for the January to March gross domestic product (GDP) growth following the delayed implementation of the 2019 budget that resulted in lower than expected public spending.
“Dominguez said the national government incurred a higher than estimated underspending in the first quarter.”
“[The reelected budget] hit on our spending was double than what we expected,” Dominguez told reporters on the sidelines of the DOF anniversary celebration. “We expected P45 billion, but our estimate is now over P90 billion. You know that is a billion pesos a day.”
For this reason, the finance chief said “fingers crossed,” they are hopeful the country could still meet its revised GDP target for this year of 6.0 percent to 7.0 percent, which is already lower than the Duterte administration’s original goal of 7.0 percent to 8.0 percent.
“Anything above six will be very good considering all the conditions that happened,” Dominguez said when asked about the likelihood the economy expanded by at least 6.0 percent last quarter.
Last week, Socioeconomic Planning Secretary Ernesto M. Pernia said the economy likely grew slightly above 6.0 percent in January to March this year, within President Duterte’s downward adjusted target of 6.0 percent to 7.0 percent for this year.
“More on the lower end siguro (maybe),” Pernia told reporters when asked about his assessment of the economy in the first three months of the year and if the country met its economic growth target.
Pernia said the government was halted to further accelerate public spending during the quarter owing to Congress’ failure to pass the 2019 General Appropriations Act (GAA) before the end of last year.
“Because of the reenacted budget, [which lasted for] four months, or one third of the year,” the NEDA chief said when he explained why the economy may have only expanded by 6.0 percent in the first three months.
However, Pernia saw some positive factors that somehow compensated for the delayed national budget.
“Lower inflation motivated more spending of people, households and election related spending,” Pernia said.
The 6.0 percent to 7.0 percent GDP goal is already an adjusted range, which came from 7.0 percent to 8.0 percent.
The Duterte administration’s economic team slashed its economic growth target after the budget delay.