DAVAO CITY: The Philippines is expected to remain one of Southeast Asia’s fastest-growing economies this year, Socioeconomic Planning Secretary Ernesto Pernia said on Friday.
Speaking before a crowd of business leaders during The 7th Manila Times Business Forum at Marco Polo Hotel, Pernia said the Philippines was the third fastest-growing economy in Asia with a full-year gross domestic product (GDP) of 6.7 percent last year.
“The Philippines is expected to remain one of the fastest growing economies of Asia, over the next couple of years, at least. In 2018, Philippine GDP growth could be the second fastest, next only to India,” said Pernia, who heads the National Economic and Development Authority (NEDA).
“Our economy has been on a consistent upward growth trajectory, rather sharp in more recent years. Our growth in 2017 was 6.7 percent and it was within our growth target of 6.5 to 7.5 percent,” he added. “We are poised to be among the rising economies in Asia.”
The economy grew by 6.6 percent in the fourth quarter of last year, driven mainly by the industry sector to lift the full-year growth to 6.7 percent, according to the Philippine Statistics Authority.
Full-year 2017 growth last year came in at 6.7 percent, slower than the 6.9 percent expansion recorded in 2016. The government has set a 7-percent to 8-percent official GDP growth target this year.
GDP is the value of goods and services produced by a country in a given period.
The NEDA chief also noted that the country’s total factor productivity had been the fastest among Southeast Asian nations.
“Our external position is pretty strong and favorable, in terms of current account and external debt, OFW remittances, merchandise trade, and net foreign direct investment,” Pernia said.
Record FDIs seen
He also said net flows of foreign direct investments (FDI) totaled $7.9 billion from January to October 2017, reflecting confidence in the economy.
“By December, our FDI would’ve surpassed $8 billion,” the NEDA chief added.
For infrastructure, the government will raise spending from 4 percent of GDP in 2017 to 6 percent by 2022, or an investment cash basis of P6.8 trillion over six years, to usher in “the Golden Age for Infrastructure.”
Under the Duterte government’s “Build, Build, Build,” the government will roll out 75 flagship, “game-changing” infrastructure projects, with about half targeted to be finished within President Duterte’s term.
There are also plans to spend P9 trillion on “hard and modern” infrastructure until 2022.
‘Nearly all to benefit from Train’
Pernia maintained that the Tax Reform for Acceleration and Inclusion Act (Train) would benefit 99 percent of Filipino households, and would further strengthen the country’s economy.
“The Train Law will benefit 99 percent of Filipino taxpayers, and the non-taxpayers are exempted from paying taxes,” Pernia said.
The government has repeatedly touted the benefits of the tax reform law, which provides income tax cuts for the majority of Filipino taxpayers while raising additional revenues to help support the government’s accelerated spending on infrastructure and social services.
Over 10 million Filipino households will receive P200 a month this year to offset the slight increase in prices due to the higher excise taxes imposed by Train, whose constitutionality has been challenged by two groups before the Supreme Court.