Congress body maintains RP growth forecast at 1.1-1.9%

MANILA, Philippines - The Congressional Planning and Budget Department (CPBD), the think-tank of the House of Representatives said it is maintaining its revised economic growth forecast for the year despite the weaker-than-expected 0.8-percent economic growth for the third quarter.

CPBD earlier revised its full-year economic growth forecast to a range of 1.1 percent to 1.9 percent from a previous projection of 0.6 percent to 1.8 percent following the 1.5 percent growth in the second quarter of the year which beat the government’s forecast range of -0.1 percent to 0.9 percent for the period.

However, for the third quarter, the economy registered a weaker growth at 0.8 percent, which was below the official forecast range for the period of 1.6 percent to 2.6 percent.

CPBD indicated that the economy can still grow by at least 0.9 percent in the fourth quarter to meet the lower end of the government’s 2009 GDP target of 0.8 percent to 1.8 percent.

For next year, CPBD is also maintaining its “guarded outlook” with a GDP growth projection of 2.5 percent to 3.4 percent, slightly lower than the official target of 2.6 percent to 3.6 percent.

The think-tank said the Philippine economy is still treading on risky ground.

“The growth remains fragile especially with risks such as the continuing uncertainties in global eocnomic prospects and the ballooning budget deficit among others,” CPBD said in its latest report on the economy.

The budget deficit has already widened to P266.1 billion, P16 billion more than the full-year ceiling of P250 billion.

To address the problem, CPBD urged the government to put in place revenue measures to boost state coffers.

“Thus, the implementation of strategic reforms must be continued. Improving tax collection efforts must be pursued along with a prudent national expenditure program geared toward high impact social development programs and projects in infrastructure and social services,” CPBD said.

The Philippine economy grew by 0.7 percent in the first three quarter of the year.