PH ‘okay’ if growth stays at 7% in next 20 years

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Socioeconomic Planning Secretary Arsenio Balisacan said on Tuesday the Philippines would be “doing okay” if gross domestic product (GDP) growth were to keep its pace
at 7 percent in the next 20 years.

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“Development is responding to new ages. If we succeed to grow 7-percent GDP in five years, there can be new problems that may emerge. We just have to have new systems to respond to that,” Balisacan told reporters after delivering his keynote speech during the Management Association of the Philippines (MAP) meeting on Tuesday.

Balisacan, who is also the director general of the National Economic Development Authority (NEDA), said the government is optimistic that the country will be able to achieve its GDP growth targets of 6.5 percent to 7.5 percent this year, 7 percent to 8 percent in 2015 and 7.5 percent to 8.5 percent in 2016.

“The problem [with growth]in the past is that we grew, but did not invest in power [and infrastructure]so the boom-bust cycle of economy went down in the 1990s where brownouts as long as eight hours happened . . . I don’t think that problem will happen again,” Balisacan said.

In his keynote speech before officials of the MAP, Balisacan said that present economic gains may not be felt by the masses, but emphasized that they should give the government “a chance to achieve economic outlines” stipulated in the updated 2011-2016 Philippine Development Plan (PDP).

Comparison within region
In the same event, University of the Philippines Professor of Economy Ben Diokno mentioned that the Philippines “remained the poorest” among the Asean 5 economies that also count Indonesia, Malaysia, Thailand and Singapore.

The UP economist also noted that the Philippines has the highest incidence of poverty among the Asean 5 with 25.2 percent in 2012. Meanwhile, Thailand has the second highest poverty incidence at 13.2 percent in 2013.

But even with the criticisms on the way the Aquino administration plans future economic growth, Balisacan said that a Philippine GDP growth of 10 percent would not be a threat, because that would be like “an old car running 100 kilometers per hour.”

For the first quarter of the year, NEDA is confident that the Philippines would achieve 6.5-percent to 7.5-percent GDP growth.

However, according to Diokno, the government should implement “bold reforms not business as usual,” and to “have strong sustained growth, modest unemployment, lower poverty, high foreign direct inflows, modern and reliable public infrastructure, effective government and a competitive economy.”

He said that the real challenge ahead is the Asean Economic Community that will come into force by 2015. Asean stands for the Association of Southeast Asian Nations.

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