Finance chief expects PHL economy to grow faster in 2018

The Philippine economy is expected to grow faster this year as the effects of the newly-enacted tax reform law kick in and the Duterte administration rolls out big-ticket infrastructure projects, Finance Secretary Carlos Dominguez III said Tuesday.

“As I said last year, there will be a more exciting growth narrative for the Philippines this 2018—more so now that all of the government’s plans to keep the country among the world’s fastest-growing economies have started falling into place,” Dominguez said in a statement.

The Philippine economy expanded by 6.6 percent in the fourth year of 2017, bringing the full-year growth to 6.7 percent.

This compares with the upwardly revised 7.0 percent GDP growth in the third quarter of 2017 and 6.6 percent in the fourth quarter of 2016.

The full-year 2017 economic growth is slower than the upwardly revised full-year 2016 GDP at 6.9 percent.

The fourth quarter GDP results fall within the 6.7- to 6.9-percent forecast of Socioeconomic Planning Secretary Ernesto Pernia for the full-year 2017.

Dominguez said the government is assured of adequate funds for its “Build, Build, Build” infrastructure program on the back of an estimated P90 billion in additional revenue from the Tax Reform for Acceleration and Inclusion (TRAIN) law this year.

The government is also banking on official development assistance as a result of President Duterte’s foreign policy re-balancing towards Asia and the successful $2-billion global fund float, of which $750 million was allocated to raise new money.

Such developments would ensure a steady revenue flow for the government’s aggressive spending on public infrastructure, which, in turn, would spell greater economic activity, according to the Cabinet official.

The “sizable” personal income tax cuts under the TRAIN law would boost consumer spending and help spur greater economic activity, he said.

Data from the Department of Budget and Management (DBM) showed that public spending on infrastructure rose by 44.8 percent at P43.8 billion as of November 2017.

This year, the Duterte administration aims to implement 76 big-ticket infrastructure projects worth $35.5 billion or P1.1 trillion, which are seen to create 1.7 million jobs over the medium-term. — Ted Cordero/GMA News