Diokno Eyes at Least 7% GDP Growth in 2019

Budget and Management Secretary Benjamin Diokno is hopeful that 2019 gross domestic product (GDP) will hit the lower end of the 7 to 8 percent target set by economic managers.

“We’re confident that this time we’ll hit 7 percent, at least,” he said in a briefing Wednesday.

The 7-8 percent target band will continue to be the yearly GDP goal until 2022, the final year of the Duterte administration.

Diokno said attainment of the growth target will get a big boost from the approval of the proposed PHP3.757-trillion national budget for this year, on which Congress is still deliberating.

The current administration targets to increase infrastructure investments to increase productivity in the domestic economy to ensure that growth will be more inclusive.

For this year, the government’s infrastructure spending is programmed at PHP909.7 billion or about 4.7 percent of domestic output based on the cash-based budgeting system.

The government targets to implement cash-based appropriations starting this year, funds under which has a one-year validity with a three-month extension.

In the past, the government used the obligations-based system, which has a two-year validity.

In 2017, DBM started to implement the one-year validity of appropriations even as the government is still operating on an obligations-based system to help government agencies get ready for the cash-based budgeting system this year.

Meanwhile, Diokno said infrastructure spending in the first two years of the current administration is better than in the past governments.

The Duterte administration took office in July 2016, thus, its first full-year in office started in 2017.

Infrastructure spending in 2017 accounted for 6.3 percent of GDP and 6.2 percent in 2018, DBM, in a statement, released Wednesday.

Data from the DBM website showed that infrastructure and other capital outlays (CO) totalled to PHP94.4 billion in October 2018, 83.4 percent higher than year-ago’s PHP51.5 billion.

In the first 10 months last year, total infrastructure and other CO reached PHP665.1 billion, up by 50.3 percent than the PHP442.7 billion same period in 2017.

The agency said latest annual infrastructure spending is way higher than the 2 percent average since 1986.

“This is in line with the Duterte administration’s target of increasing infrastructure spending to more than 7.0 percent of GDP by 2022,” it said.

Under the Ramos administration, infrastructure spending in 1993 was about 1.3 percent of GDP, while it was 1.9 percent of total domestic output the following year.

Under the Estrada administration, it was 1.4 percent of GDP in 1998 and 1.7 percent in 1999; under the Arroyo administration, 1.7 percent in 2001 and 1.4 percent in 2002; and under the second Aquino administration, 1.8 percent in 2011 and 2 percent in 2012. (PNA)