Source: Philippine Star, 15 December 2011
MANILA, Philippines (Xinhua) – The Philippine government expects the country’s GDP to expand by five percent this year on back of increased public spending, a senior economic manager said today.
This, despite global uncertainties and the lower than expected growth in the past three quarters. But National Economic and Development Authority (NEDA) Director General Cayetano W. Paderanga Jr. said, “there are good reasons to be optimistic in the sense that government consumption has really caught up to some extent.”
Paderanga said at a news briefing that the government is ” restructuring” the P50 billion ($1.13 billion) savings in 2011 which is expected to support the economy in the fourth quarter. This amount does not include the entire P72 billion ($1.63 billion) worth of stimulus package.
Paderanga said growth this year was largely affected by the government’s underspending which is estimated to have cost the country’s GDP around 0.25 to 0.5 percent in 2011.
Lower government spending pushed the country’s construction numbers to plunge to historical lows. In the third quarter alone, the construction sector fell 12.2 percent.
Paderanga also expects the Philippine economy to grow five to six percent next year, especially when more Public Private Partnerships (PPPs) infrastructure projects will be launched.
The government has already held a bidding for the P1.96 billion ($44.43 million) worth of Daang Hari-South Luzon Expressway project, the first PPP project to be bidded out from the original list of ten projects identified by the government in October 2010.
Paderanga said after this project, it is likely that the 10,000 classroom project of the Department of Education will be bidded out. The project is estimated to cost around $7 billion ($158. 69 million).