The Philippine Economy

[wheel of steel]

Originally Posted by icarusrising

What do you think, guys?

absolutely nothing wrong here... very good move by Baluts government...

[Askal82]

Originally Posted by manileño

i don't see why we should close our borders to Chinese investments with the little spat we have with them over Spratlys. we can not deny the importance of China in today's global economy and the government must learn to separate the spratly issue from the wider bilateral economic relationship we have with them for our mutual advancement.

(and it looks like none of those being eyed for Chinese investors is in Palawan anyway, so as long as we keep them out in that one province. hehe!)

It's a double-edged sword I guess. I think we can allow their investments as long as it doesn't involve anything that will directly compromise our national interests - like defense technology, communication, transportation, mining, power, etc.

If they can invest in manufacturing, R&D, and other industries involving transfer of technology why not?

[wheel of steel]

America is using the Philippines as the staging ground to mount anger to these Chinese. I believe as of this moment Politicians are being pressured by US. They want to wage a "mini war kuno" to established danger in SEAsia hence the need for military to push for ugrade???? tssskkkk....

[Askal82]

Even without the US, Philippines and the ASEAN is still threatened by China's aggressive real estate shopping spree in West Philippine Sea anyway.

[wheel of steel]

Return of Bicol Express to boost tourism


THE resumption of the operations of the Bicol Express got a big boost from the tourism industry following its “soft opening” last week.

Stakeholders in the tourism sector lauded the Philippine National Railways for its efforts to resurrect the Manila-Naga City route despite minor delays during the maiden voyage.

Tourism Educators and Movers chairman Robert “Bobby” Joseph said the return of the Bicol Express is a welcome news to the country’s tourism industry.

Joseph said the Bicol Express gives tourists and travelers another alternative to reach the beautiful destinations in the Bicol region.

He said he will promote the train experience through the League of Tourism Students of the Philippines, SKAL International, Rotary Tourism Movement, non-IATA local agencies nationwide, Travel Cooperative of the Philippines, Fair Trade Alliance, Federation of Philippine Industries, 777 and 888 news forums, and the consular and diplomatic community.

“I believe that PNR’s master plan is to rehabilitate the Legazpi route and build additional railway tracks that would connect the province of Sorsogon. Tourist destinations like Donsol Whale watching, non-stop trip going to Camsur Sports Watersports Complex and reaching sites near Mayon Volcano in Albay will be more interesting with the world-class sleeper coaches now being offered by the PNR,” Joseph said.
__________________

[wheel of steel]

Originally Posted by Askal82

Even without the US, Philippines and the ASEAN is still threatened by China's aggressive real estate shopping spree in West Philippine Sea anyway.

But US is taking advantage of the situation. It's economy rellies heavily on the sale of their technologically advance military equipments.... We should not be surprised why they are doing this..

[Askal82]

Originally Posted by wheel of steel

But US is taking advantage of the situation. It's economy rellies heavily on the sale of their technologically advance military equipments.... We should not be surprised why they are doing this..

What else is the other option? Let China violate the UNCLOS and invade our territory defenseless? It's not just the US backing the Philippines on this. We can also acquire hardware from Europe and Russia as well.

If US can provide $2B of aid to Pakistan who backstabbed them by allowing terrorists to be in their territory, untouched, why not on Philippines who is considered a long time ally of America?

[manileño]

Originally Posted by Askal82

It's a double-edged sword I guess. I think we can allow their investments as long as it doesn't involve anything that will directly compromise our national interests - like defense technology, communication, transportation, mining, power, etc..

If they can invest in manufacturing, R&D, and other industries involving transfer of technology why not?

Agree on those points except that, i dont see anything wrong with allowing them to invest in transportation, mining and power. Only defense technology and communication i think are iffy as they could 'directly' interfere with our national interests. Mining--we have some Taiwanese investors involved in this sector already. Power-- some Korean firm just put up a coal plant in Cebu. Transportation--i think the Chinese NorthRail project is already on its way after being reviewed. so IMO, instead of promoting such paranoid policies, i think it would be better if we just push our legislators to work on passing those regulations that would ensure those foreign investments do not impair the laws of the land, our national security and national interest (in Spratlys and across the territory).

[bledzoe]

Bidding for NAIA Expressway phase II set for January 2012

By Ma. Elisa P. Osorio (The Philippine Star) Updated July 06, 2011 12:00 AM Comments (0)



MANILA, Philippines - The bidding for the P10.6-billion Ninoy Aquino International Airport (NAIA) Expressway Phase II under the Public Private Partnership (PPP) is scheduled for January next year.

The NAIA Expressway Phase II is one of the first PPP projects that is up for bidding because the detailed engineering for the project is nearly completed.

In an interview with reporters, Philippine Chamber of Commerce and Industry (PCCI) president Francis L. Chua said that during their meeting with the economic cluster they were informed that the publication for the bidding of the NAIA Expressway Phase II will happen this month. The prequalification process is scheduled for August.

Qualified bidders are scheduled to submit their bid in September while the bidding proper will be on January 2012. Awarding is in March. A year after or April 2013 construction for phase II is expected to begin while it should be finished by 2015.

This project, like all the others identified under the PPP, is entitled to tax perks under the 2011 Investments Priorities Plan. All IPP projects are qualified to register in the Board of Investments (BOI) for incentives.

The project is one of the components of the Metro Manila Urban Expressway System and a major infrastructure component of the Manila International Airport Access Improvement Project.

However, a study showed that government subsidies and higher toll rates are needed in order to attract more bidders for the project.

In the Feasibility Study Report made by Ernst & Young, the financial evaluation of the project showed discouraging reports due to the low Financial Internal Rate of Return (FIRR) of only 5.41 percent assuming that a basic toll rate of P6.00 is followed.

The study showed that the level of toll fee would make the project financially viable. For instance, the study showed that at a toll fee of P9.50 per kilometer and with a 36-percent government subsidy, the project will have a 9.8-percent FIRR which would make it attractive to investors.

“On the other hand, government intervention is required to enhance the viability of the project through provision of additional funds that will cover the civil works and the right of way acquisition,” the study stated.

Doing this will cut the P10.6-billion project cost dramatically because civil works costs make the highest cost at P8.6 billion while right of way acquisition cost is at P1 billion.

Another expressway to rise in Central Luzon
By Punto Central Luzon Home Updated July 06, 2011 10:42 AM 0 comment to this post



MALOLOS CITY, Philippines – The Central Luzon Regional Development Council (RDC) has mulled for the construction of the 63.9-kilometers Central Luzon Link Expressway (CLLEx) that will connect Tarlac City and San Jose City in Nueva Ecija.

The new expressway, divided into two phases, is estimated to cost at least P29.2 billion. The 28-kilometer first phase, estimated to cost P13 billion, will link the Subic-Clark-Tarlac Expressway terminus in Tarlac City and the Pan-Philippine Highway (PPH) or the Daang Maharlika Highway in Cabanatuan City, Nueva Ecija.

The 35.9-kilometer second phase, which will link the cities of Cabanatuan and San Jose is estimated to cost at least P13-billion.

Engineer Carmelito Dizon of the Department of Public Works and Highway Project Management Office ((DPWH- PMO) said the expressway project will benefit not only Central Luzon but northeastern Luzon provinces like Cagayan Valley and Isabela.

“It will generally improve access to the food basket of Aurora in Central Luzon and Cagayan Valley region as well as provinces in the eastern part of the Cordillera Administrative Region (CAR),” he said.

Dizon said that with the completion of the CLLEx, travel time between Metro Manila and provinces in the eastern seaboard of Luzon will be faster, safer and more predictable.

“The projects is basically envisioned to provide linkage between SCTEx and the PPH integrating eastern Central and North Luzon provinces with Metro Manila,” he said. Documents showed that level of service of the PPH has increasingly deteriorated in the past decades.

Based on a feasibility study financed and conducted by the Japan International Cooperation Agency, a total of at least 16,000 vehicles will use phase I of CLLEx between the cities of Tarlac and Cabanatuan upon completion in 2016.

The same volume of traffic is expected to be reduced from the PPH that starts in Plaridel, Bulacan to Cagayan.

“It will also decongest traffic volume in Bulacan because vehicles going to eastern North Luzon will likely use the NLEx then SCTEx and the CLLEx,” he said.

After the presentation, the project was endorsed by the RDC Sectoral Committee on Infrastructure Development (SCID) on the motion of its vice chair, Jose Rozaldo Jr., a private sector representative to the council.


Travellers International signs deal for 5th hotel in Resorts World

By Zinnia B. Dela Peña (The Philippine Star) Updated July 06, 2011 12:00 AM Comments (0)



MANILA, Philippines - Travellers International Hotel Group Inc., a unit of Andrew Tan’s Alliance Global Group Inc., said yesterday it has inked a memorandum of understanding with an unnamed major international hotel management company to operate a fifth hotel in Resorts World Manila.

Based on its disclosure to the stock exchange, AGI said the newest offering will be a five-star hotel with 350 rooms

Kingson Sian, president of Travellers International, said the identity of the hotel chain which has a track record of managing 300,000 hotel rooms globally, will be announced in the next two months.

“This hotel management company has several successful global brands under its belt. We at Travellers look forward to the expertise it can bring to the table,” Sian said.

The new hotel, together with Marriott, Maxims, Remington and Belmont, offer a total of 2,200 rooms. Global hotel chains Marriott and Maxims are currently operational, while the construction of budget hotel Remington and condotel Belmont are ongoing.

Last year, Marriott Manila was chosen as the best hotel among all Marriott hotels in the Asia-Pacific region, underscoring the popularity of Resorts World Manila as a tourist destination.

Located in the 25-hectare Newport City in Pasay City, Resorts World Manila is set to host the country’s largest concentration of hotel rooms within a half-kilometer radius.

Resorts World Manila, located near the domestic and international airports, serves as a gateway to the Philippines and its vibrant urban center, Metro Manila.

World-class leisure attractions at Resorts World Manila include the 1,500-seat Newport Performing Arts Theater, Newport Mall, high-end cinemas, a gaming center and a wide variety of luxury spas, specialty stores and fine-dining establishments.

“We want to be a major player in the tourism industry because we are excited about its prospects in the country. We will continue investing heavily in building top-notch facilities to showcase the Philippines’ natural beauty, history and culture and highlight the Filipinos’ warmth and hospitality,” Sian said.

[bledzoe]

Optibelt opens Manila office
(The Philippine Star) Updated July 06, 2011 12:00 AM Comments (0)



MANILA, Philippines - Leading German manufacturer of high performance transmission belts, the Arntz Optibelt group, opened recently its first Philippine office in Prestige Tower, Ortigas Center.

The event was marked by an intimate dinner and ribbon cutting which was attended by Optibelt’s international representatives, including director for Asia Pacific of Optibelt Asia Pacific Pte Ltd., Thomas Tegethoff and Managing Director of Optibelt Asia Pacific, Torsten Seifried. Optibelt stands out among over 300 competitors worldwide having such big clients as Philip Morris, Lafarge, and Holcim.

“We bring service,” Seifried noted, in his inaugural speech. “We build our own engineering team to teach distributors and users how to squeeze more life out of our products. At Optibelt, we always go further in development. Our belts ensure superior lifetime. In this field, to save the customer’s money, we’re number one.”

Among those who attended the opening was Mark Li of Bearing Center and Machinery Inc. He said: “Optibelt is one of the best quality belts out there. We are very happy to have them. With Optibelt, we can maximize everything.”

Oliver Ang, president of Riken Motor Sales, said: “I think it’s a good move for them. We expect that it will be able to support the Philippine market. They have been very helpful in all aspects of the business, from the trainings and seminars, to the activities we do together.”

Asked why Optibelt initially chose the Philippines as its newest hub, Seifried replied: “We believe that the market in the Philippines is growing and they need more support. We want to give on-site support—not only through our distribution partners, but by being present ourselves.”

The Arntz Optibelt Group currently has 29 distribution offices in Europe, North and South America, and Asia. A recent breakthrough due to advantages in the drive technology also enabled them to acquire the new models of Volkswagen and BMW.

[Eastern Dragon]

FYI.

there is already a constitutional prohibition or cap in foreign investments by foreign firms on certain industries.

[wheel of steel]

Originally Posted by manileño

Agree on those points except that, i dont see anything wrong with allowing them to invest in transportation, mining and power. Only defense technology and communication i think are iffy as they could 'directly' interfere with our national interests. Mining--we have some Taiwanese investors involved in this sector already. Power-- some Korean firm just put up a coal plant in Cebu. Transportation--i think the Chinese NorthRail project is already on its way after being reviewed. so IMO, instead of promoting such paranoid policies, i think it would be better if we just push our legislators to work on passing those regulations that would ensure those foreign investments do not impair the laws of the land, our national security and national interest (in Spratlys and across the territory).

[Kintoy]

Originally Posted by s40

IMHO, stock market volatility should not be a source of joy or disappointment specially for small movements. The pse has been hovering up and down close to the high and breaking the ceiling does not mean anything to the general economy. A big decline tomorrow by 4% also does not mean anything to our general economy.

If we are tallking about the markets 40% increase over 12 months, that is worthy of economic analysis. Just want us to be realistic and not get blinded by media hype about our economy.

The economy is still under developed but a lot of good press release we see no fundamental shift to high growth potential.

actually the stock market increase by a lot in the past 12 months. probably not 40% but close to it.

and for people who are watching/investing in stocks 1.6% gain in a single day is substantial.

[Kintoy]

Originally Posted by hugodiekonig

But not definitely a sky rocket na gaya noong isang trading day noong 2008 na 9.8% ang increase sa share prices. Adequate adjectives maybe 'surge', 'rose sharply' or 'inched up' exag naman ang media

actually the "skyrocket" is referring to the market reaching a record high.

[r0mm3l]

World Banks keeps PHL growth forecast at 5%
http://www.gmanews.tv/story/225509/b...-forecast-at-5

The Philippine gross domestic product will grow by 5 percent this year and 5.4 percent next year, the World Bank said Wednesday, keeping its earlier forecast for the Southeast Asian nation’s P850-trillion economy.

The Washington-based multilateral lender’s figures are lower than the Philippine government’s 7-percent to 8-percent target range from 2011 to 2016.

However, the World Bank said in its Philippine Quarterly Review that the economy may grow better as the strong focus and early gains of the Aquino administration in tackling corruption and improving the investment climate could boost domestic investment.

The challenge now is sustaining the momentum of reforms to achieve inclusive or broad-based growth that benefits the poor, the bank said.

"While business confidence has dampened in light of various external shocks that took place in early 2011 — the MENA and Japan events, rising commodity prices — domestic investment represents an important upside potential given the strong focus and early gains of the Aquino administration in tackling corruption and improving the investment climate," according to the World Bank report said.

End of trade disruptions

Prospects for the supply side remain favorable with manufacturing and construction projected to benefit from the end of the trade disruptions linked to Japan’s post-disaster reconstruction, as well as the solid growth forecast for the business process outsourcing, World Bank senior economist Eric Le Borgne said.

"Increasing mineral prices will provide incentive to fast track investment and increase production in the mining sector. The strong performance of the services sector in the first quarter is expected to remain robust throughout the year. The agriculture sector is projected to continue being a net contributor to growth," Le Borgne added.

The Philippines’ recent performance indicates that the country’s economy has already stabilized since the global financial crisis, with more robust and less variable growth, Bert Hofman, World Bank country director, said.

"Prior to the global recession that started in 2008, the country was perceived to have a weak fiscal position, making it vulnerable to shocks and volatility. The global recession showed the extent to which the country’s economic fundamentals have improved, Hofman said. — VS, GMA News

[boypad]

High inflation bites consumers, business

Business Mirror Philippines
Wednesday, 06 July 2011 21:33
Dennis D. Estopace / Reporter

FRIED chicken was no longer on the dining table on Lina Villareal’s 66th birthday celebration, unlike last year. She should have gone to her favorite fast-food restaurant, where the prices of chicken meal have so far been steady.

But even that is going to change soon, according to Rommel Juan, president and CEO of Binalot Fiesta Foods.

The entrepreneur told the BusinessMirror that inflation has forced him to decide to raise prices by the third quarter of this year. “We can’t cope with the high prices anymore. It’s been a difficult six months,” Juan said in a telephone interview.

Binalot, Juan said, is trailing behind competitors in raising their menu
prices despite the impact on the increasing cost of rice and meat. Even the prices of condiments have gone up.

For Juan, the high prices in restaurants, plus the rent in shopping malls are all feeding the monster called inflation, which increased to a two-year high of 5.2 percent in June, using the new 2006-based consumer price index series.

According to the Bangko Sentral ng Pilipinas, the prices of most food products, including rice, meat and fish products, and fruits and vegetables, rose “due to supply constraints triggered by weather disturbances during the month.” In particular, the prices of fruits and vegetables are up 4 percent since a year ago, while the prices of fish has increased by 6.2 percent.

Utility costs have also been climbing, adding an extra strain to entrepreneurs, like Juan. Fuel prices have gone up 15 percent year-on-year in June, while water rates soared 9.7 percent, and electricity by 7.1 percent.

Malacañang is hoping the inflation would go down since oil prices have begun to go down, a Palace official said on Wednesday.

“The high inflation was due to oil prices but since oil prices are tapering off, we would expect, hopefully, a lowering of inflation rate, as well,” Presidential Spokesman Edwin Lacierda said in a news briefing.

Asked if the 5.2-percent inflation in June is not a cause for concern for the government, Lacierda said Malacañang “is hoping that the oil price would go down and certainly they have been going down but the Bangko Sentral would be monitoring the inflation rate and would do the necessary corrective actions if there would be any increase in inflation rate.”

In the meantime, Villareal, who retired in 2008 from teaching at the Cecilio Elementary School on 7th Avenue in Caloocan City, said she and her family have since stopped eating out at establishments like Binalot, given the rise in transport costs and other basic needs.

“Before—and this was just a year ago—I was straining to lift bags of P1,000 worth of grocery items. Now, the bags are nearly as light as feather,” Villareal said in Filipino.

She also mentioned that her medicine for hypertension now costs P43 for a 4-milligram pill. “That’s already discounted using a senior citizen card!”

Just in January, Villareal said her medicine budget could buy her 20 pills. Last month she said she almost had a heart attack when the same amount only afforded her 10 pills.

“And I’m single. Imagine what married women go through,” she said.

Juan said businesses have no choice but to increase prices and perhaps lose customers in the process. “That’s the price of survival,” he said.

He noted that some newcomers in the fast-food sector would try to engage in a price war but he said only those with a loyal customer base and established brands can emerge victorious in this battle.

“Of course, you can expect the price-conscious consumers to reduce the frequency of their visits to your business. Those with a low price base can expect to attract these customers,” he said.

Juan said he expects to increase Binalot’s prices between 2 percent and 3 percent.

“These are difficult times for business. Only the savvy can survive,” he said.

Even the big fast-food players are feeling the heat. At its recent stockholders’ meeting, Jollibee Foods Corp. chief finance officer Ysmael V. Baysa noted that its second-quarter performance “is behind our target because of the increases in raw material costs.” Jollibee’s first-quarter net income was lower by 8.8 percent, Baysa added.

For Villareal, the only thing to do to get through inflation is to further cut down spending on nonessentials and to maintain savings. “And try to stay healthy,” she added.

(With Mia Gonzalez)

[Kintoy]

World Bank hails steady Philippine growth

The World Bank on Wednesday praised the Philippines for its steady economic growth despite the global economic shocks and hailed reforms made by the government of President Benigno Aquino III.

In its quarterly update, the bank said it expects Philippine economic growth to stabilize at 5 percent this year and rise to 5.4 percent in 2012. The economy grew 7.6 percent last year.
Manufacturing, construction, buoyant metals prices as well as a booming business process outsourcing industry are expected to be the main growth drivers, said World Bank senior economist Eric Le Borgne.

The body also cited potential gains from reforms put in place by Aquino who was elected in May 2010.

“Prospects on the supply side remain favorable with manufacturing and construction projected to benefit from the end of the trade disruption linked to Japan’s post-disaster reconstruction,” Le Borgne said in a statement.

The update also praised Aquino for his efforts to fight corruption, upgrade the country’s infrastructure, and open up aviation to foreign competition to boost tourism.

World Bank country director Bert Hofman said the Philippines’ recent performance, which saw 4.9 percent growth in the three months to March, suggests growth had become more robust and steady since the global crisis.

He cited a series of credit rating upgrades that put the Philippines’ sovereign debt to within two rungs of investment grade last month.

Aquino’s office said in a statement that the World Bank report showed that the Philippines’ economic fundamentals had “significantly improved” and that the government’s programs were sound.

Manila has an “aspirational target” of 7-8 percent GDP growth for 2011 but projects more modest growth of 5-6 percent.

http://business.inquirer.net/6132/wo...lippine-growth

[wino]

eto.. para akong sirang plaka... haha


World Bank: Philippine economy's prospects good
Published: Wednesday, 6 Jul 2011 | 8:34 AM ET


MANILA, Philippines - Prospects remain favorable for the Philippine economy in 2011, with investments, private consumption, services and exports expected to post gains, the World Bank said Wednesday.

The bank's quarterly Philippine report said the end of trade disruptions linked to Japan's post-disaster reconstruction is seen to benefit manufacturing and construction, while solid growth is forecast for the country's business process outsourcing industry.

World Bank Senior Economist Eric Le Borgne said rising mineral prices may fast track investments and increase production in the mining sector. The services and agriculture sectors also are likely to contribute to growth.

The report maintained the bank's forecast of 5 percent gross domestic product growth rate in 2011 and 5.4 percent in 2012.

But it said growth could potentially be higher because the government's early gains in tackling corruption and improving the investment climate could boost domestic investment.

Exports are seen to recover due to a technical rebound in exports affected by Japan's tsunami and nuclear plant disaster and a potential boost in exports as Philippine companies and workers take part in the reconstruction of affected areas, the report added.

Private consumption is seen to be buoyed by strong wage growth and employment among relatively well paid sectors like the BPO, it said.

World Bank Country Director Bert Hofman said the Philippines' recent performance indicates that its economy has stabilized since the global financial crisis, with more robust and less variable growth. Prior to the global recession that started in 2008, the country was perceived to have a weak fiscal position, making it vulnerable to shocks and volatility.

The report said the challenge now is to achieve broad-based growth that benefits the poor.

Presidential spokesman Edwin Lacierda said the report "recognizes the significance of the reforms undertaken by the administration, and how these measures provide stability as we pursue inclusive growth."

[manileño]

Originally Posted by Kintoy

World Bank hails steady Philippine growth


In its quarterly update, the bank said it expects Philippine economic growth to stabilize at 5 percent this year and rise to 5.4 percent in 2012. The economy grew 7.6 percent last year.

Manila has an “aspirational target” of 7-8 percent GDP growth for 2011 but projects more modest growth of 5-6 percent.

yup, i think Manila has come to realize that now with several economists adjusting their forecast within the 4%-6% range for 2011. Is government underspending really to blame?

Gov’t infrastructure outlay still deficient
Posted on July 05, 2011 11:12:37 PM
BY DIANE CLAIRE J. JIAO, Reporter

INVESTMENTS in infrastructure continued to lag despite the government’s claims that it had accelerated spending in an effort to sustain economic growth.

While the Department of Budget and Management (DBM) has assured that capital outlays were picking up, analysts raised fresh concerns that continued underspending could drag down economic growth.

Latest fiscal data show that the government spent P591.041 billion as of May but this was largely due to current operating expenditures, which made up P507.6 billion. Capital outlays accounted for only P73.3 billion and the remainder went to net lending.

Personal services, which pays for the salaries, allowances and benefits of civil servants, was the main driver of government expenditures from January to May at P196.9 billion, over a third of the full-year program. It also grew from the P191.6 billion posted a year ago after Malacañang advanced the third tranche of the Salary Standardization Law for Labor Day.

Infrastructure spending, on the other hand, amounted to only P42.2 billion, down significantly from the P106.1 billion spent a year ago. Budget Secretary Florencio B. Abad has noted that 2010 was buoyed by the national elections and a “spending binge” by the previous administration.

Nevertheless, infrastructure investments as of May comprised barely a fifth of the full-year program, even as the government had initially planned to frontload these expenses to give the economy an early boost.

The mismatch between current and capital expenditures means the boost in spending is not occurring where it matters the most, warned Albay Governor Jose S. Salceda, an economic adviser of the previous administration.

“Spending for personal services has little impact on the economy. The reason why infrastructure investments are important is because they have a multiplier effect,” he told BusinessWorld yesterday in a telephone interview.

Mr. Abad sought to downplay fears of underspending, though, after it was largely blamed for the modest 4.9% gross domestic product (GDP) growth posted in the first quarter.

“We are below target [in infrastructure spending], but the pace has picked up,” Mr. Abad said in a separate phone interview yesterday.

He noted that P1.164 trillion had been released to government agencies as of May, over 70% of the P1.645-trillion national budget. This is an improvement from the P891.1 billion released in the same period last year, which amounted to only 58% of the P1.541-trillion budget.

Included in the releases so far this year are the P7-billion fund for basic educational facilities and the P2-billion allotment for various public works projects.

However, analysts said it may be too late.

“Catching up with infrastructure spending is still possible but unlikely. Rains have come... I think public construction will spill over to next year,” University of the Philippines economist Benjamin E. Diokno said in an e-mail.

As a result, the job creation and the multiplier effect of public infrastructure projects will also be postponed to next year, he added.

Mr. Diokno, a former Budget Secretary, predicted that the economy growth could have slowed to 4.7% in the second quarter and average 4.8% for the rest of the year.

This was backed by University of Asia and the Pacific economist Cid L. Terosa, who predicted GDP growth of 4.7-5% for the second quarter and 5.5-6% for the year.

“Lower infrastructure spending will curtail growth. It could hold down growth by 0.5%,” he said in a text message.

For his part, Mr. Salceda urged economic managers to downgrade the “fighting target” of 7-8% full-year growth. He forecast a 4.5-5% growth for the second quarter and 5.5-6% growth for the year.

The DBM’s Mr. Abad stood firm, though, saying: “Spending doesn’t just happen ... Obligation fees are paid once the project is bid out. There are also payments for phases of the projects...”

http://www.bworldonline.com/content....cient&id=34269

[Kintoy]

Diokno again. the doom-and-gloom economist.