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Philippine economy ‘doing well’ despite adverse reports says IMF

Economy on its way to having majority upper middle-income one by 2022

Gulf News

Manila: A team from the International Monetary Fund (IMF) that recently visited the Philippines stated that the country’s economy is “performing well” despite low public optimism.

Dr Luis E. Breuer head of the team of the international lending agency to government said: “The Philippines has been one of the region’s strong economic performers over the past years, reaping the fruits of prudent policies and critical reforms.”

Filipinos are not as optimistic of their economy given the average resident has to bear with rising cost of goods and overall cost of living.

A kilo of rice for example cost P50 (Dh3.43) two weeks ago, now it costs P54 (Dh3.71) while other basic food items prices are rising at a fast rate given the 5.3 per cent inflation in June.

However the government said that other external factors such as the strong US dollar had much to do with the increasing cost of living in the Philippines and not a “faltering economy”.

The IMF said the government’s policies regarding their economy have been good so far.

“The [IMF] team welcomes the authorities’ strategy of maintaining policy continuity, while adapting to emerging challenges, and taking advantage of the strong economy to implement reforms to improve inclusive growth and job creation. This strategy has served the Philippines well.”

The IMF team forecasts the country’s real GDP growth to be 6.7 per cent and the inflation rate to stagnate below 4 per cent, citing the governments “prudent policies and critical reforms”.

Urgency

Finance Secretary Carlos Dominguez III said the IMF’s latest findings further highlight the urgency and importance of pursuing the administration’s economic agenda for sustained high growth and financial inclusion.

“There will be no let-up in the government’s policy of aggressive spending on infrastructure and human capital development while maintaining fiscal prudence, in line with President Rodrigo Duterte’s vision of reducing poverty to 14 per cent and transforming the economy into an upper middle-income one by 2022,” he added.

Budget Secretary Benjamin E. Diokno said the country’s fiscal policy will continue to be prudent, sustainable, and supportive of our investments in public infrastructure and human capital development.

“As President Duterte noted in his State of the Nation Address earlier this week, our economic growth agenda will ensure no Filipino is left behind,” Diokno said.

Anti-Duterte politicians had also been blaming government revenue restructuring under the Tax Reform for Acceleration and Inclusion (TRAIN) Law, for the high prices.

The President ordered the TRAIN Law to be implemented this year.

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