BSP says economy may repeat 2010 feat
MANILA, Philippines—The Bangko Sentral ng Pilipinas still believes that the economy will attain its growth target of 7 to 8 percent this year despite concerns that the rate of rise in consumer prices appears to be accelerating.
Tetangco shrugs off inflation concerns
MANILA, Philippines—The Bangko Sentral ng Pilipinas still believes that the economy will attain its growth target of 7 to 8 percent this year despite concerns that the rate of rise in consumer prices appears to be accelerating.
BSP Governor Amando Tetangco on Friday said that the central bank still held to its forecast that the economy could duplicate this year the robust growth witnessed in 2010.
“We still expect the economy to grow by 7 to 8 percent this year,” Tetangco said in a speech during the induction of the 2011 officers of the Economic Journalists Association of the Philippines held in Makati City.
The economy grew by 7.3 percent last year—its fastest rate of rise in 34 years. However, expectations of accelerated inflation have elicited concerns that growth this year may slow down.
This is because the faster rate of increase in prices may drive demand for goods and services.
But Tetangco said that, while inflation could accelerate this year, average price movements would nonetheless fall within comfortable levels.
The BSP expects inflation to settle at 4.4 percent this year, within the government’s target range of 3 to 5 percent, the central bank chief said.
When President Aquino assumed power in mid-2010, the government adopted what some called an ambitious target of making the economy grow by at least 7 percent annually over the medium term.
The goal was anchored on studies saying that the Philippines would need to grow by at least 7 percent annually for several years in order to reduce poverty incidence.
Foreign developmental institutions like the World Bank and the Asian Development Bank cited the Philippines for escaping a recession in 2009, but commented that growth did not make a difference in the country’s efforts to reduce poverty.
Latest government data showed that poverty incidence—the proportion of poor people to the country’s total population—stood at 26.5 percent in 2009, rising slightly from the 26.4 percent reported in 2006 even though the economy grew during the period.
The poverty incidence survey is conducted once every three years.
Economists said that the benefits of the economy’s growth had not been trickling down to the poor. This is because the population of poor Filipinos appears to be growing faster than the rise of middle- and high-income earners. Also the poor had little access to education, which could have helped them out of their hardship.
“We still expect the economy to grow by 7 to 8 percent this year,” Tetangco said in a speech during the induction of the 2011 officers of the Economic Journalists Association of the Philippines held in Makati City.
The economy grew by 7.3 percent last year—its fastest rate of rise in 34 years. However, expectations of accelerated inflation have elicited concerns that growth this year may slow down.
This is because the faster rate of increase in prices may drive demand for goods and services.
But Tetangco said that, while inflation could accelerate this year, average price movements would nonetheless fall within comfortable levels.
The BSP expects inflation to settle at 4.4 percent this year, within the government’s target range of 3 to 5 percent, the central bank chief said.
When President Aquino assumed power in mid-2010, the government adopted what some called an ambitious target of making the economy grow by at least 7 percent annually over the medium term.
The goal was anchored on studies saying that the Philippines would need to grow by at least 7 percent annually for several years in order to reduce poverty incidence.
Foreign developmental institutions like the World Bank and the Asian Development Bank cited the Philippines for escaping a recession in 2009, but commented that growth did not make a difference in the country’s efforts to reduce poverty.
Latest government data showed that poverty incidence—the proportion of poor people to the country’s total population—stood at 26.5 percent in 2009, rising slightly from the 26.4 percent reported in 2006 even though the economy grew during the period.
The poverty incidence survey is conducted once every three years.
Economists said that the benefits of the economy’s growth had not been trickling down to the poor. This is because the population of poor Filipinos appears to be growing faster than the rise of middle- and high-income earners. Also the poor had little access to education, which could have helped them out of their hardship.
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