Global economic unpredictability continues to be an issue, yet it might be premature to adjust Philippine growth objectives, according to National Economic and Development Authority Secretary Arsenio M. Balisacan.
“We’ll observe. Numerous events are unfolding, particularly with all this instability in the worldwide economy. We need to reassess. We have just updated the data,” Mr. Balisacan informed journalists on March 7.
The Development Budget Coordination Committee (DBCC) in December expanded the gross domestic product (GDP) growth objective to 6-8% for 2025 through 2028, owing to “shifting domestic and global uncertainties.”
“It’s premature to modify at this stage, but we must remain vigilant and adaptable due to this unpredictability,” he remarked.
Budget Secretary and DBCC Chair Amenah F. Pangandaman mentioned that historically, the committee tends to keep its targets steady during the first and second quarters of each year.
A DBCC gathering is planned for the end of March, while a technical working group will convene next week.
When questioned if the lower range of the growth objective is still achievable this year, Mr. Balisacan stated: “I’m not suggesting it’s no longer feasible, but I believe we will allow ourselves to evaluate the numbers in May.”
The economy expanded by a less-than-anticipated 5.2% in the fourth quarter, resulting in a full-year GDP growth of 5.6% for 2024, falling short of the government’s 6-7% target.
Mr. Balisacan noted that “uncertainty in the global landscape and any potential decline” is a worry, but decreasing inflation and a strong labor market indicate a “promising” performance for the first quarter.
The inflation rate decreased to 2.1% in February from 2.9% in January and 3.4% a year earlier. This figure was also below the 2.2%-3% prediction by the Bangko Sentral ng Pilipinas.
Mr. Balisacan also expects inflation to remain within the target range in the upcoming months.
“Naturally, another aspect we are concerned about is exports, particularly the external sector of the economy,” he stated.
New tariffs imposed by the US government would indirectly impact the Philippines, as no nation would be exempt, according to Mr. Balisacan.
“In the past two years, our economy’s exports sector, the external sector, has not performed well. As I mentioned, most of the growth we experienced was primarily domestic. While there is investment inflow, it remains quite weak,” he added.
The NEDA Chief underscored the necessity for the nation to diversify its markets to enhance resilience to shocks, and to be proactive in entering free trade agreements. — Aubrey Rose A. Inosante