Friday, 10 February 2012 11:52
The Philippine economy is projected to grow more than 4.6 percent in the first quarter of the year mostly because of the increased government spending, the National Economic and Development Authority (NEDA) said Wednesday.
Socioeconomic Planning Secretary Cayetano Paderanga Jr., told reporters that the first quarter gross domestic product (GDP) is likely to be higher than the 4.6 percent growth in the same period last year.
In the fourth quarter of last year, the economy expanded by only 3.7 percent.
"The government expenditure program is really working well but of course there are some downside risks and we're watching what's happening in Europe and then of course the oil issue," Paderanga said.
Ruperto Majuca, NEDA's assistant director general, said there was a good chance that the first quarter GDP growth would be higher than last year.
"I see that the possible drivers will be the public construction, the ramping up of public expenditures then also in general there's a high business confidence. This is reflected, among others, in the stock market performance so this confidence will tend to stimulate business activity, investment and then it would have a positive impact overall," Majuca said.
The National Statistical Coordination Board (NSCB) earlier reported that the composite leading economic indicator (LEI) recorded an upward trend to 0.238 in the first quarter from a revised 0.168 in the fourth quarter of last year.
"The latest LEI computations show the index in firmer positive territory auguring well for the domestic economy to start off the year of the dragon," the NSCB said.
For the full year, Paderanga said that the government is sticking to its economic target of 7 percent to 8 percent.
"It will be fairly difficult [to achieve the target] considering the slowdown in global economic environment, including the Eurozone debt and the economic woes because it could spill over to other countries such as China. And then indirectly impact us also. So, we will also have to watch closely the recovery of the US, if it will firm up or it will remain fragile. We will have to watch closely China, of course Europe," Majuca said.
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