OVERALL economic growth this quarter will likely clock in faster than last semester when numbers are reported on Nov. 7, Socioeconomic Planner Ernesto M. Pernia told reporters on Thursday.
“I think we’ll have a higher performance… higher than the second quarter… higher than in the first semester,” Mr. Pernia said when asked on his initial assessment on third-quarter growth on the sidelines of a public policy conference.
Gross domestic product (GDP) growth crawled by 5.6% and by 5.5% in the first and second quarters, respectively, taking last semester’s average pace to 5.5% against an already reduced official 6-7% target for the entire 2019.
Mr. Pernia had said it would take a second semester growth of 6.4% to enable the economy to hit the lower end of that target range.
On Thursday, he was less clear if the third-quarter pace would approach or beat the year-ago 6.02%. Asked if he thought six percent was doable, he replied: “I would think so,” citing “the usual drivers” — in reference to household spending, which though easing lately still contributes about 70% to GDP, and bigger government expenditures as state offices rush to catch up with delayed spending plans.
Both the government and private sector economists blamed the growth slowdown last semester on late enactment of the national budget for this year and the 45-day ban on public works ahead of the May 13 elections that left new projects unfunded for much of the first semester.
President Rodrigo R. Duterte on April 15 finally signed the 2019 national budget into law, but vetoed about P95.3 billion in funds he said were not in sync with priorities of his administration, slashing this year’s spending program to P3.662 trillion.
The government spent P1.93 trillion in the seven months to July, still 0.11% less the year-ago P1.932 trillion, while spending on infrastructure and other capital outlays were still down 11.6% year-on-year at P386.6 billion, still far from the government’s P1 trillion full-year program, according to latest data released by the Department of Budget and Management (DBM).
The DBM also reported earlier this week that utilization rate of national government Notice of Cash Allocation (NCA) — authority given by the department to disburse funds to cover state offices’ operations, projects and programs — improved to 92% in the eight months to August, corresponding to P1.802 trillion worth of NCAs out of the P1.961 trillion in NCAs issued for that period, from 86% a year ago. — Beatrice M. Laforga