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AS many
expected, high food and commodity prices were the
biggest factors that had dragged down economic growth in
the first quarter.
The
National Economic and Development Authority (Neda),
although still to release its official gross domestic
product (GDP) estimates at the end of the week, already
expects about only 6-percent GDP in the first quarter.
Neda
planning and policy staff officer in charge Myrna
Asuncion confirmed the estimate and ascribed it to the
inflation rise in the past few months. “If the current
trend in
Thailand
is followed, our GDP for the first quarter may be around
6 percent.”
She
recalled that last year, the Philippines outperformed
Thailand in all four quarters and hoped to surpass it
again by achieving the high end of Thailand’s
4.5-percent to 6.0-percent projected GDP growth rate
this year.
Asuncion
said tempering inflation is a complicated effort.
Initially, she said, the Bangko Sentral ng Pilipinas (BSP)
saw a reprieve from high commodity prices toward the end
of the year, but now sees that prices may increase even
more.
Factors
such as the base effect caused by last year’s low
inflation figures and the continuous increase in food
and oil prices will also likely result in higher
inflation and lower growth this year.
Asuncion
said the only growth drivers able to somehow cushion the
ill effects of high inflation will have to be the
infrastructure spending both by the government and the
private sector.
“The
government front-loaded its expenses for infrastructure
such as farm-to-market roads and other ongoing projects
at the same time private construction has been ongoing,”
she said.
The
recent inflation data from the National Statistics
Office (NSO) show headline inflation [real time rate of
rise in prices] to be 8.3 percent, the highest since May
2005, when inflation hit 8.5 percent.
The
overall annual inflation rate for food alone surged to
12 percent in April from 8.4 percent in March. This was
mainly due to a 24.6-percent increase in rice prices,
19.3-percent increase in corn prices, and 13.9-percent
increase in cereal preparation prices.
The NSO
data showed that all commodity groups at the national
level continued to record higher annual price increases
in April. Inflation for food, beverage, and tobacco rose
to 11.4 percent in April from 8.2 percent in March.
The
National Income Accounts will be released by the
National Statistical Coordination Board on May 29.
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