Higher infrastructure and other capital spending in September allowed the government to top its year-to-date target, a Cabinet official said on Wednesday.
Spending totaled P65.2 billion during the month, up 21.6 percent from the P53.6 billion recorded a year earlier, Budget Secretary Benjamin Diokno told reporters.
Major infrastructure items include Public Works department projects such as the construction and repair of roads nationwide, preventive maintenance, flood control and drainage improvement works, and the storm surge and slope protection construction.
The government also spent on local infrastructure projects such as shelter and utilities initiatives under the Bangsamoro Regional Inclusive Development for Growth and Empowerment program in the Autonomous Region in Muslim Mindanao.|
The September result brought infrastructure and capital spending to P570.8 billion in the first nine months of the year, 45.9 percent higher during the same period a year ago and also exceeding the government’s P532.6-billion target.
“This is proof that the ‘Build Build Build’ program is firing on all cylinders,” Diokno claimed.
IHS Markit APAC chief economist Rajiv Biswas said the latest figures indicated that the government was “delivering a substantial ramping up of infrastructure spending in 2018.”
“[It] will help to support GDP (gross domestic product) growth at a time when significant BSP (Bangko Sentral ng Pilipinas) monetary policy tightening is dampening private sector consumption and investment,” he added.
The government is banking on a massive infrastructure push via the “Build Build Build” program to propel economic growth, which economic managers recently revised to a lower 6.5-6.9 percent this year from 7.0-8.0 previously.
The revision was made as inflation exceeded targets, a development that has also prompted the government to shelve a planned tax hike that would support state spending. Officials have said infrastructure projects would be exempted from the subsequent spending cuts.
Infrastructure spending buoyed overall government spending to P2.490 trillion from January to September, 2.6 percent higher than the P2.427-trillion program.
BY MAYVELIN U. CARABALLO, TMT