Government likely to increase 2018 export growth target

MANILA, Philippines — The inter-agency Development Budget Coordination Committee (DBCC) may adjust upward its projections for the country’s export growth in 2018 after better than expected performance in the past few months, according to the Department of Finance (DOF).

In an interview, Finance Undersecretary Gil Beltran said economic managers may raise in today’s meeting their growth assumptions for export next year from the current projection of seven percent.

“Export growth should be double digit,” Beltran told reporters.

In its last meeting on June 9 this year, the DBCC had hiked its export growth projections from two percent to five percent in 2017, from five percent to seven percent in 2018, and from seven percent to nine percent in 2019. Thereafter, export growth is expected to be maintained at nine percent from 2020 to 2022.

“This is consistent with the observation that global trade is picking up, so we adjusted our exports (assumptions),” Budget Secretary Benjamin Diokno, who heads the DBCC, had said then.

According to the latest data from the Philippine Statistics Authority (PSA), the country’s total export sales in October rose 6.6 percent to $5.37 billion from $5.04 billion in the same month last year. This marked the 11th consecutive month of positive growth in exports.

However, imports still continued to outpace exports, amounting to $8.21 billion, or 13.1 percent up from $7.26 billion the previous year.

This resulted in a trade deficit of $2.84 billion in October, higher than the $2.22 billion deficit in October last year.

Meanwhile, Beltran expects other macroeconomic assumptions of the DBCC to improve after its meeting today. However, he declined to name which indicators and projections would be changed.

“It will be announced later depending on their decision but all are improvements over the previous (assumptions),” Beltran said.

Meanwhile, Diokno said in a separate interview other agenda in today’s meeting include the review of the government’s 2017 performance, discussion of the Tax Reform for Acceleration and Inclusion Act, and updates in the 2018 budget.

In terms of macroeconomic indicators, Diokno said no changes are expected in the growth assumptions for the economy.

“I think there will be none, because we have good prospects,” he said.

The budget chief, however, said there may be changes in the inflation projection due to higher price increases in the past months. But he assured that such change may only be slight considering the high base effect.

“You have to recognize that inflation is comparing this year with last year. If it’s already high now, it may not increase too much next year,” he said.