By CHINO S. LEYCO
The Philippine economic growth would have been boosted by almost one percentage point last year had the national government received its approved spending plan on time, the Department of Finance (DOF) said yesterday.
Finance Secretary Carlos G. Dominguez III said the economy, as measured by the gross domestic product (GDP), could have expanded by 6.8 percent last year if the national government was able to sustain the pace of public spending registered in 2018.
“If the 2019 budget was passed on time and the national government was able to replicate the 2018 growth in government consumption and government construction in 2019, the economy would have grown by an additional 0.9 percentage point or 6.8 percent,” Dominguez said.
On Thursday, Socioeconomic Planning Secretary Ernesto M. Pernia said that GDP growth last year slowed to its lowest level in eight years, or since 3.7 percent registered in 2011.
Pernia attributed the slower growth on the budget impasse that led to delays in the implementation of government programs, the election spending ban that affected mainly infrastructure projects and the El Niño phenomenon.
“Our estimate before was a full percentage point was lost because of the delay in the passage of the budget. If we just use that again, we could have been close to, if not, right smacked seven percent this year. That’s our guesstimate, but a good guesstimate,” Pernia said.
To recall, President Duterte signed the 2019 general appropriations act (GAA) only in mid-April.
The national government originally targeted to grow the economy by around 7.0 percent to 8.0 percent last year, but the range was lowered twice — 6.5 percent to 7.5 percent, and finally, 6.0 percent to 6.5 percent.
Meanwhile, Dominguez expects the economy “firing on all cylinders” this year amid robust government spending on infrastructure and social services, stronger domestic consumption resulting from benign inflation, and a revitalized agriculture sector.
Dominguez said this year’s fiscal expansion for greater economic activity will get its multiple boost from the swift congressional approval of the 2020 GAA, and extended validity of the 2019 national budget.
The government’s higher revenue take from the implementation of the comprehensive tax reform program (CTRP) along with the tax administration reforms by the Bureau of Internal Revenue and Bureau of Customs will support growth, the finance chief said.
For 2020, the Duterte administration expects GDP growth to be around 6.5 percent to 7.5 percent.