APD | Philippine economic managers revise inflation rate for 2019

BY APD NEWSJul 18,2019 at 22:46

By APD writer Melo M. Acuña

MANILA, July 18 (APD) – The country’s economic managers reduced the inflation rate for 2019 to the range of 2.7 to 3.5% because of the decisive steps to stabilize the general price level.

Speaking after the 176th meeting of the Development Budget Coordination Committee at the Department of Finance, Department of Budget and Management officer-in-charge, Secretary Janet B. Abuel said the reduction of the inflation rate is due to the full implementation of President Rodrigo Duterte’s directives to increase food supply and the passage of the Rice Liberalization Act.

“The inflation assumption for 2019 to 2022 has been retained at 2.0 to 4.0%,” she added.  The economic manager’s assumption for the price of Dubai crude oil per barrel for 2019 to 2022 has also been retained between US$60-75 per barrel.

As far as the exchange rate for the Philippine peso against the US dollar, they adjusted to P51 to P53 against the US dollar and calibrated at P51 to 55 from 2020 to 2022, “projecting the possible appreciation of the peso with easing inflation pressures and positive market sentiment with the recent sovereign credit rating upgrade of the Philippines.

During the same briefing, the managers said assumptions in goods exports growth were pegged at 2.0% in 2019 because of slower global growth and maintained at 6.0% from 2020 to 2022.  Goods imports growth projections were lowered to 7.0% in 2019 and maintained at 8.0% from 2020 to 2022.  Services export growth assumptions were set at 9.0% from 2019 to 2022 while services imports growth was fixed at 3.0% in 2019 and 4.0% in 2020 and 5.0% in 2021 to 2022.

Meanwhile, the managers projected revenue collections to reach P3.15 trillion which is 16.4% of Gross Domestic Product (GDP) while disbursements are targeted to hit P3.77 trillion in 2019 which is equivalent to 19.6% of GDP.

Acting Secretary Abuel said they expect revenues will increase to P3.54 trillion equivalent to 16.7% of GDP in 2020 while disbursements have been programmed to P4.21 trillion or 19.9% of GDP.  

“Given the revenue and disbursement program adopted by the DBCC, the deficit target will be maintained at 3.2% of GDP from 2019 to 2022 to sustain the government’s investments in infrastructure and human capital development,” Ms. Abuel added from a prepared statement.

As far as the government’s development targets and fiscal priorities, the economic managers plan to propose a budget of P4.1 trillion in 2020 which is 12% higher than last year and equivalent to 19.4% of GDP.  According to the DBCC, this would respond to the needs and would capture the aspirations of the Filipino people.

“The proposed 2020 National Budget will continue to invest in public infrastructure and social services while funding the priority programs of the Duterte administration such as the Bangsamoro Organic Law, the Universal Healthcare Law, the institutionalization of the Pantawid Pamilyang Pilipino Program (4Ps), among other measures to promote economic and human capital development,” she concluded.  

National Economic and Development Authority Undersecretary Rosemarie G. Edillon, Finance Asst. Secretary Ma. Teresa S. Habitan and National Treasurer Rosalia V. De Leon composed the panel who answered questions from both local and international media in a press briefing late Thursday afternoon.  

(Top image: Department of Budget and Management Acting Secretary Janet B. Abuel updates the media on the results of the 176th Meeting of the Development Budget Coordinating Committee late Thursday afternoon. /Melo M. Acuna)

(ASIA PACIFIC DAILY)

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