International credit rating company, Moody’s Investor Service raised its outlook on the Philippine banking industry from negative to stable, due to better local economic potential and improving global situation. The Philippines is one of the twelve countries in Asia-Pacific to gain an improved outlook after the debt watcher predicted that the region will have strong economic growth and will be able to manage its debt at a controllable level.
Likewise, as per the latest published report of the Institute for Development and Econometric Analysis, Inc. (IDEA), value added tax (VAT) collection grew by 17% year-on-year to P163.62 billion in 2009, up from the previous period’s P140.32 billion. According to the Bureau of Internal Revenue, the implementation of tax enforcement measures, including Oplan Kandado, massive campaigns, surveillance, stock-taking, and tax compliance verification drive, account for the increase in revenues.
However, the Bangko Sentral ng Pilipinas estimated that the inflation for January will be somewhere between 4.5% to 5.4%, still within the target of 3.5-5.5% for this year. The higher inflation will result from more expensive food and fuel, along with the recovering global economy and increased spending due to the upcoming elections.
Furthermore, the Finance department changed budget for state expenditures from P1.569 trillion to P1.578 trillion, due to the expected wider budget deficit of P293 billion. This year’s budget is up by 6% from last year’s P1.489 trillion. Finance Undersecretary Gil Beltran cites typhoon rehabilitation projects and stimulus programs as the causes for the increased spending. Total government revenues are expected to reach P1.285 trillion, down from the earlier projection of P1.336 trillion.
On the other hand, as a result of lower world oil prices, Chevron Philippines Inc., Eastern Petroleum Corp., PTT Philippines Corp., Seaoil Philippines Inc. and Petron Corp. rolled their fuel prices back, after Flying V, Phoenix Petroleum Philippines Inc. and Pilipinas Shell Petroleum Corp. reduced their prices earlier. After accounting for the latest price reduction, fuel prices have decreased by P1.50 per liter of diesel and P1.25 per liter of gasoline since the start of this year.
To ease the burden of the financial crisis, the Department of Environment and Natural Resources is projecting the generation of 26,848 new jobs. Investments in mining are said to account for the job creation. Moreover, Environment Secretary Eleazar Quinto held that the reforestation program of the government will help create 11,578 livelihood opportunities.
Lastly, data from the National Statistics Office showed that output from the manufacturing sector grew by 6.5% in November 2009. The Volume of Production Index (VoPI) grew by 0.5% from October to November, while the Value of Production Index (VaPI) increased by 2.1%.
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