DoF sees 7% GDP growth in 2013

The Philippines can achieve a five to six percent nominal gross domestic product (GDP) growth by end of 2012 and six to seven percent by 2013, the Development Budget Coordination Committee (DBCC) predicted.

In its presentation paper presented to the Senate appropriations committee in last Monday’s continuation of the lengthy hearings prior to the approval of the P2-trillion 2013 budget, the DBCC said there are six growth drivers that the Philippines can count on that’s why the nominal GDP growth predictions can be achieved.

Nominal GDP is a growth of goods and services in a country plus inflation.

DBCC is carefully calibrating its growth forecast without solid grounds as a result of the dismal GDP growth of the Philippines in 2011 which only reached 3.2 percent.

The GDP growth last year was the lowest since 2000.

“With due respect your honor, we will try our very best to arrive at this forecast,” Finance Undersecretary Lea de Leon, representing Finance Secretary Cesar Purisima, told committee chairman Sen. Franklin Drilon.

The undersecretary said the six growth drivers are food sector, tourism, increase in retail trade activities, business process outsourcing, electronics manufacturing and communications network modernization.

De Leon said among the six, the Philippines can rely thoroughly on BPO sector as there are now 600,000 employees in the sector.

Less than half of the number of employees in the BPO sector is call center agents.

The presentation of growth potentials led the appropriations committee to give the DBCC a passing mark on the macroeconomic level presentation of the growth forecasts.

Despite the passage, the DBCC still needs to pass the House counterpart of the appropriations committee chaired by Cavite Rep. Joseph Emilio Abaya.

De Leon said there is another area where the country can count, too, when it comes to growth prospective — the private-public partnership (PPP).

However, the DBCC opted not to lean on the issue as only one of the 17 PPP projects have been awarded to private sector.

A Finance official, who refused to be named, said if the government will at least award half of the PPP projects to private firms and will be operational in two years time, there will be an automatic plus three percent growth in GDP.

“Without new roads, how can we assure that investors will come into the country and their products will move fast. The result of having only one PPP approved is we will lose to other countries that have multi-layered overpasses, wide airports and MRTs. Filipinos will be left in the sidelights,” the source said. –Ed Velasco, Daily Tribune