NEDA PROJECTS SLOWDOWN IN GDP GROWTH NEXT YEAR
MANILA, APRIL 9, 2007 (STAR) By Des Ferriols - The National Economic and Development Authority (NEDA) sees a slower growth in the country’s gross domestic product in 2008 at 5.8 percent from 6.1 percent expected this year.
But ongoing discussions at the Development Budget Coordination Committee (DBCC) indicated that economic planners are expecting a more favorable trend toward 2010, or a GDP growth of around 6.2 percent in 2008.
Forecasts by the NEDA showed that the real GDP was projected to grow by 6.1 to 7.1 percent this year as approved by the DBCC last January.
However, DBCC officials told reporters that a strong year was normally followed by a slower year. In this case, the GDP growth rate in the year following this year’s strong performance was expected to decelerate to 5.8 percent.
By 2009, the GDP growth rate is expected to bounce back and reach 6.7 percent before surging farther to 6.9 percent by 2010, due to sustained strong economic performance.
"But the cabinet does not want this blip in the 2008 growth rate so the projections are likely to be smoothened," a DBCC official privy to the discussions said.
Likely revisions in the GDP projections would put the 2008 growth rate at 6.2 to 7.2 percent and by 2009 this would increase to 6.3 to 7.3 percent before going up to 6.4 to 7.4 percent in 2010.
The original growth target under the 2007 budget program was pegged at 5.7 to 6.5 percent but economic officials said they were expecting better economic output this year due to a surge in investments.
Officials said the revisions reflected increased optimism for the country’s economic growth prospects this year that would be spurred by a solid rebound in investor confidence as the country emerged from a fiscal crisis.
The DBCC also upgraded its target growth rate for gross national product. GNP includes net factor income from abroad broken down into income from offshore investments and remittances from overseas Filipino workers.
According to the DBCC-approved target, the Arroyo administration intended to achieve GNP growth rates of 6.2 percent to 7.1 percent, up from the original target of six percent to 6.9 percent.
By 2008, GNP growth is expected to steady at 6.2 percent, accelerating to 6.7 percent in 2009 and to 6.9 percent in 2010.
Chief News Editor: Sol Jose Vanzi
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