PHL authorities say 2010 deficit won't be breached

Philippine authorities believe the budget deficit will not exceed the P325-billion ceiling this year as the national government continued to exercise prudent spending and improve its tax collection efficiency. Deputy Treasurer Eduardo Mendiola told reporters Wednesday the 2010 budget shortfall would fall below target at 3.9 percent of the gross domestic product. “We will not exceed P325 billion, we are very sure of that," Mendiola stressed. Bureau of Treasury data showed that the deficit totaled P259.8 billion in the first nine months of the year, or P13.9 billion narrower than the P273.7 billion programmed for January-September. In the same period last year, the deficit reached P237.5 billion as the Bureau of Internal Revenue and the Bureau of Customs failed to deliver on their revenue targets. Government revenues totaled P894.7 billion in January-September, while expenditures amounted to P1.154 trillion. Due to the rounding off of numbers, the results may not add up to the exact mathematical equation, the according to the Treasury Bureau. While the tax take of the BIR increased by 9 percent to P607.3 billion, the amount was P13.2 billion short of the P620.5-billion programmed collection. In the case of the BOC, its tax take went up by 15.5 percent to P191 billion — an amount P19.2 billion below the P210.2-billion target. Fiscal authorities have committed to limit the budget deficit to 2 percent of GDP from 2013 the end of the Aquino administration’s term in 2016. The president and his economic managers are keeping their fingers crossed for another credit rating upgrade by New York-based Moody’s Investors Service following the recent upgrade by Standard & Poor’s Rating Services from BB- to BB. The upgrade marked a first for the Philippines under the Aquino administration. It brought Philippine sovereign debt to just two notches below investment grade. “We have upgraded the Philippines based on its steadily improving external liquidity profile and the underlying strengths of its external accounts, which increasingly mitigate the vulnerabilities posed by still high public and external debt, and provide buffer against adverse shifts in terms of trade or investor sentiment," S&P credit analyst Agost Benard said. — VS, GMANews.TV