RP economy to grow this year: NEDA chief

Posted at 08/26/2009 2:27 PM | Updated as of 08/26/2009 3:57 PM

MANILA - The Philippines will not slip into recession and is certain to post growth this year as the global economy starts to recover from the worst recession in decades, the economic planning chief said on Wednesday.

The government will release official data on second quarter growth on Thursday at 0200 GMT.

"The Philippines is not going into recession. We will still exhibit positive economic growth for the whole year of 2009," Augusto Santos told reporters.

Santos' comments reinforced results of a Reuters poll on Monday which showed the economy escaped recession in the second quarter, growing by a seasonally adjusted 2% to reverse the previous quarter's 2.3% contraction.

2 consecutive quarters of negative growth signal a recession.

"The global and Philippine economies appear to have bottomed out in the second quarter and we expect a rebound in the third quarter," Santos said.

Last week, the economic planning agency said the economy likely bottomed out in the first half and should post stronger growth later this year when election-related spending starts and consumers shop ahead of the Christmas holidays.

It said second quarter GDP may have come in at a 0.1% contraction to a 0.9% expansion from a year ago.

The government expects growth to weaken to 0.8% to 1.8% this year, the slowest pace in at least eight years, as the Philippine economy feels the pinch of the global downturn.

The Philippine central bank had cut rates by a total 2 percentage points from December to July to support growth.

It ended its easing cycle last week by keeping key rates steady at a record low of 4%, and signalled it may maintain a neutral stance until signs of strong sustainable growth become more evident.


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