NEDA sees Philippine exports up in 2011

The National Economic and Development Authority (NEDA) expects Philippine exports to sustain its strong momentum next year because of the continued recovery of the global economy. “Global demand is strengthening," Socioeconomic Planning Secretary and NEDA director-general Cayetano Paderanga Jr. said over the weekend. “World merchandise trade expanded by 23 percent in the first three quarters of 2010, continuing the recovery that began in the second quarter of 2009. Despite this positive trend, the value of world trade remains below its peak level prior to the present financial crisis. So we do have some space to run up for a while," Paderanga said. According to the latest report from the National Statistics Office (NSO), the country’s merchandise exports grew by 37.1 percent from January to October 2010. This is on the back of strong external demand for semiconductors and electronic products, he said. Stimulus spending, investments At the same time, Paderanga noted risks to economic and trade growth such as the possible narrowing of investment sources. “The stimulus spending caused countries to run up fiscal deficits and accumulate public debt. Poor fiscal management in these countries may result in governments of developed countries competing with the private sector for funding and investors will be demanding a higher risk premium for holding bonds issued by a highly indebted country," he said. On the inflation side, Paderanga said that while the continued surge of capital inflows may introduce upside risks to inflation, these inflows should be taken as an opportunity to improve the country’s economy and competitiveness. “It is therefore critical that we strategically invest the dollars that are coming into the country. We would like to use them to invest in the needed infrastructure, like highways," Paderanga said. The government, he said, would continue to monitor the economy and implement policies that would look after the interests of all sectors, including the exporters. — MRT/VS, GMANews.TV