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Gov't still expects 5.2% GDP growth in 2004 |
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(December 18, 2003 - Thursday, Philippine Daily Inquirer)
BUCKING recommendations of the central bank to set more modest economic targets for next year, Economic Planning Secretary Romulo Neri said Wednesday the government was sticking to its goal of a gross domestic product (GDP) growth of 4.9-5.8 percent in 2004. |
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This year, GDP is expected to reach the lower end of the 4.2-5.2 percent forecast.
Neri said the higher growth in 2004 would be achieved with an anticipated rise in exports, a surge in farm output because of the absence of the drought-inducing El Niño weather disruption, a pick-up of the housing and construction sectors, and the sustained vibrancy of the services sector. In 2004, he said the growth in gross national product (GNP) should be between 5.2 and 6.0 percent. Neri said his fearless forecast was a 5.2-percent growth in GDP and 5.9 percent in GNP. "There is no need to adjust the growth targets although I agree with the BSP that there is a need to look at potential problems," he said. "For me, the problems could be the deficit and its impact on interest rates as well as to investor confidence." Bangko Sentral ng Pilipinas (BSP) Governor Rafael Buenaventura earlier said the BSP was coming up with a conservative set of numbers for 2004 that would reflect modest growth expectations, a weaker peso, and higher interest rates. "I think our estimate brought down the lower end of the target because this year we are only expecting a GDP growth of 4.2 percent," Buenaventura said. "Although during an election year, we also expect increased domestic activity." He said a 4.5-percent GDP growth goal in 2004 would be more reasonable. He said the central bank would present the numbers to the Cabinet's Development Budget Coordination Committee (DBCC). Buenaventura said the "very preliminary numbers" the central bank had drafted considered factors like the prevailing political uncertainties, relatively high oil prices, and a possible wage increase. "We are still firming up the numbers for next year," he said. "They could still change but the general outlook has been factored in." Buenaventura said the estimates were computed using a 10-percent estimated growth in exports and 11 percent in imports in 2004. He also said the peso could average at 55.50 to the dollar next year against the DBCC estimate of 53.50-54.50 to the dollar. The benchmark 91-day Treasury bill rate, used by banks in pricing their loans, could also average between 8.0 and 9.0 percent, Buenaventura said. Clarissa S. Batino home | latest news |
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