RP economy to grow at its slowest in a decade

MANILA, Philippines - The Philippines likely grew at its slowest in a decade during the first three months of the year, a senior economic official conceded on Monday. The country’s economic output grew anywhere between 2.1 to 3.1 percent, Socioeconomic Planning Secretary Ralph G. Recto told reporters, citing preliminary estimates. He blamed the substantial drop in exports in the first two months of the year and reports of massive layoffs in the manufacturing sector and overseas Filipino workers. Although growth in the first quarter will be the poorest for this year, the country’s economy will improve by the third quarter, said Recto, who is also the director general of the National Economic and Development Authority (NEDA). For the second time last week, the inter-agency Development and Budget Coordinating Committee (DBCC) – a body that sets the country’s economic projections – reduced growth targets to 3.1 percent to 4.1 percent from 3.7 percent to 4.4 percent. In the first quarter of 1999, the Philippines’ growth slowed to 1.2 percent, when the country was still reeling from the effects of the Asian financial crisis, data from the National Statistical Coordination Board (NSCB) said. The government is set to announce the official economic performance in the first quarter next month. In January, exports declined 40 percent and just about the same level in February, reflecting the weakening spending in global markets owing to the economic slump, the National Statistics Office (NSO) said. The Philippines’ growth forecast was reduced after the International Monetary Fund and other multilateral agencies lowered its global economic projections, Dennis Arroyo, director for national planning and policy of the National Economic and Development Authority, said earlier. “There's also much lower projections of exports and imports," Arroyo added. Although remittances from overseas Filipino workers expanded by 2.6 percent during the first two months this year, Arroyo said economic managers chose to be conservative to project a zero growth. Shrinking factory output was also cited as a reason for the lower growth following the 19.9-percent slide in the volume of production index of the Monthly Integrated Survey of Selected Index by 19.9 percent in January. Last year the Philippine GDP grew 4.6 percent, lower than the 7.2-percent growth recorded in 2007. - GMANews.TV