PHL govt keeps 2011 growth targets at 7-8%

The Aquino administration will keep economic growth targets for the year between 7 to 8 percent despite the possible effects of the March 11, 2011 magnitude-9 earthquake in Japan on the world economy. Budget and Management Secretary Florencio Abad said there will be no adjustments for now although country’s economic team are watching out for impacts of the Japan tragedy. “The accumulation of the changes that we are tracking is not as yet as large enough for us to necessitate an adjustment or revisions in the growth target," Abad said on Tuesday. Abad co-chairs the Development Budget Coordination Committee (DBCC) with Finance Secretary Cesar Purisima. DBCC, the interagency group that sets the country’s macroeconomic assumptions and targets, met last Friday to assess the situation. Middle East situation Aside from the Japan earthquake, the other economic risks countries are facing are the the oil situation and the political crisis in the Middle East, Abad said. “The biggest source of concern right now is the political crisis in the Middle East," Abad said. This would affect the oil situation as supply may be tightened and domestic pump prices may be jacked up, he said. “With higher oil prices, comes the higher cost of transportation," Abad said. The Philippine government will thus implement a fuel adjustment program for some 300,000 beneficiaries, he said. Under the program, jeepney and bus operators and other transport groups would receive a subsidy for their gasoline expenses. Abad said an interagency team is laying out the details of the project that could be implemented starting next quarter. “The most efficient way to is distribute fuel credits," Abad said. The government is also considering fuel credits for bus and jeepney operators with the help of state-owned government financial institutions, he said. ATM-like cards may be distributed to the targeted beneficiaries, he explained. The World Bank estimates the damage caused by the recent earthquake and tsunami in Japan at $235 billion. In 2010, the Philippine economy rose by 7.3 percent, the highest growth recorded in 34 years. – VVP/OMG, GMA News