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By Chino S. Leyco, Reporter
PHILIPPINE economic growth in the first three
months of the year will match the record attained in the same period
last year, the Department of Finance said.
Finance Undersecretary Gil Beltran said the
economy, as measured by the country’s gross domestic product
(GDP), may have expanded between 6.5 percent and 7 percent in the
three-month period, matching the 6.9 percent of last year.
Last year’s first-quarter expansion was the
country’s fastest since 1990.
“Higher prices [are] an incentive for people
to produce more, vehicle production is growing and the agriculture
output is likely up,” Beltran told reporters.
The Development and Budget Coordinating
Committee (DBCC) has set a 6.3 percent to 7 percent growth target
this year, but this will be subject for review this week due to
skyrocketing commodity prices.
Government sources said the DBCC, which sets the
country’s macroeconomic goals and assumptions, will revise the
growth target downwards to a range of 6 percent to 6.7 percent,
along with other economic indicators.
They said the inter-agency body will reconsider
its inflation goal to a range of between 4 percent and 5 percent,
from the original 3 percent to 4 percent target.
BSP Deputy Gov. Diwa Guinigundo said the DBCC
will meet this week to discuss the revisions in the country’s
macroeconomic projections, adding the GDP growth target will be
subject to a “downward revision.”
Guinigundo said commodity prices were the most
significant factor responsible for the revisions.
As the DBCC realigns its inflation target, the
91-day Treasury bill rate is seen to average 3.5 percent, while
weighted at 4.6 percent.
Economic managers also expect Dubai crude, the
Philippines’ benchmark for the commodity, to average $88 a barrel
this year from the original assumption of $62 a barrel.
The interagency body had assumed the peso to
average between 40 and 43 to the dollar this year, as imports and
exports were supposed to grow 8 percent and 9 percent, respectively.
The domestic economy last year expanded by 7.3
percent, its fastest pace in 31 years. Many pundits however doubt
whether the Philippines could replicate this feat given the global
credit crunch and the slowdown in the country’s biggest export
market, the US. Last March, Philippine shipments fell 6.8 percent
due to weak sales to the US and a contraction in exports of
electronics, the country’s biggest dollar-earner.
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