PASEO DE CORO

Aquinomics

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The downward revision in this year’s second-quarter growth performance and the disappointing 3.2-percent growth in the second quarter put the Philippines’ gross domestic product growth in the first nine months of the year at 3.6 percent. This is lower than the 4.5-percent to 5.5-percent official government GDP growth target for the year. What will be the final growth figure for the whole year? The answer depends on the performance of the economy in the fourth quarter.

If the lower end of this year’s growth target will have to be reached, the economy must grow by at least 7 percent to 7.5 percent in the last quarter. This is highly improbable now, given what happened in the first nine months both domestically and globally. At most, the economy can grow only by 4 to 5 percent in the first quarter. If this happens, the full-year GDP growth will be 3.7 percent to 3.95 percent. On the other hand, if the fourth quarter growth will be 3 percent to 4 percent, then the full year GDP growth will be 3.45 percent to 3.7 percent. Either way, the result will still be lower than the target for the year.

One reason cited by many economists for the much lower than expected Philippine economic growth in the first nine months of 2011 was the failure of the national government to speed up the use of its funds. Using Department of Finance data, it can be seen that of the programmed expenditures of P1.275 trillion in the first nine months of 2011, the national government spent only P1.070 trillion, which is also lower than the P1.154 trillion spent by the national government in the first nine months of the previous year. As a result, the national government brought down its fiscal deficit to P52.994 billion in the first nine months of the year, which is also much lower than the deficit of P270.302 billion incurred during the same period last year or the programmed deficit ceiling of P234.350 billion for the first nine months of the year. A lower government deficit may look good to our leaders and lenders but not so when it is achieved with much lower growth in output, employment and income.

P-Noy’s economic team promised to do more to speed up the use of government funds in the last quarter. In addition, P-Noy announced an extra P72 billion to stimulate the economy for the rest of the year. Indeed, the National Government already registered a larger deficit in October amounting to P21.257 billion. This brought up the January to October fiscal deficit  to P74.251 billion but this was still much lower than the deficit of P270.302 billion incurred during the same period last year.

According to Singapore’s DBS group, the Philippine government’s 2011 budget deficit may actually reach P145 billion. This means that the government should have incurred an additional P71 billion in deficit in the last two months of the year. This is not hard to do and this may have been actually done already considering that only few days more are left before the close of the current year. But if this is what the government could only do, would that be enough for the economy to grow by 4 percent to 5 percent in the last quarter? I am afraid not and this means that the government must double its effort to guide the economy to higher growth path next year if it has to achieve its target of bringing down our poverty incidence, which in 2009 still covered around a third of our people using the old method of measuring our food threshold or up to a fourth of our people using the new but now very controversial method.

The four pillars of what the new government now calls “Aquinomics” are: (1) Fiscal and Macroeconomic Stability, (2) Investing in People, (3) Reducing Infrastructure Gap, and (4) Improved Business Climate. It is interesting to see what had been done in these regards after one-and-a-half year of the new government under P-Noy.

In the first pillar, some good things might actually have been achieved already but they do not necessarily result to lower poverty immediately. I already mentioned that a lower government deficit may look good to our leaders and lenders but not so when it is achieved with much lower growth in output, employment and income of our people. Presently, and aided by the increasing inflow of money from our growing number of Overseas Filipino Workers, our consumption expenditures are still robust but not our exports and investments due to the slowing down of the global economy; hence, the need for more  government expenditures to boost the economy. Unfortunately, the new government has failed to do this so far.

In the third pillar, there is now more money invested to uplift the living conditions of the poorest segment of our society through the 4-Ps or Conditional Cash Transfer Program, which the new government adopted from the previous government. But although the 4-Ps long-term impact is good in changing the mind-sets of the poor children who are now assured of basic education and brighter future with the program, its present effect is only palliative, which is to augment the income of the poor through the cash transfer.

As to the third pillar, we know that its flagship project, the PPP, has not yet taken off. Finally, there is some reported improvement in the way business is done in the country as shown by the increase in the ranking of Philippine global competitiveness, but we should not also forget that we still rank below most of our neighbors in Asia when it comes to the World Economic Forum’s Global Competitiveness Index or even the World Bank’s Ease in Doing Business Study.

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  • zoiloperez

    AQUINOMICS:

    More Filipinos getting hungry
    More Filipinos getting poor
    More Filipinos living on the streets
    More jobless Filipinos
    Rising prices of basic commodities
    Tremendous rise in gas and oil products
    No foreign investors coming in
    Foreign investors transferring business in other countries
    Tremendous rise in power/electric cost
    Rise in water cost
    Constitutional crises
    No government projects to generate employment

    STOP AND RESIST ABNOY DICTATORSHIP

    RISE AGAINST HATE, VENGEANCE AND VINDICTIVENESS

    DEATH TO THE ABNOY DICTATOR

    • http://pulse.yahoo.com/_NKKIC5MECP6ZUDJAAVB7Y5BDOA ALLAN A

      ZOILO YOUR TOO HARSH BUT ANYWAY P-NOY JUST INHERITED THIS PROBLEM FROM GLORIA THE FILIPINO PEOPLE WAS ROBBED BY GMA NOW THE PEOPLE HAVE CHOSEN THEIR WARRIOR THAT WILL PROSECUTE AND JAIL GMA ……. MAYBE YOU WERE PART OF PREVIOUS SYSTEM … BCOZ YOUR TOO PERSONAL THEN

  • dead_pixel

    eto in less than 2 years of presidency of your highness…

    1.unconstitutional EO No’s.1 & 2
    2.Samar & Balay group conflict inside Malacanang
    3. bungled hostage rescue
    4. blatant lie about the $430 million MCC grant
    5. wrongful deportation of 14 Taiwanese fraud suspects to China
    6.Cojuangco-Aquino SCTex multi million deal
    7. favoring KKK to high government positions
    8. release of morong 43
    9. denying clemency to 100 old and sick prisoners despite PPP’s recommendation but pardons a dead man
    10.failed promise to prioritize FOI Bill
    11.misleading polls by own kins’ survey firms Asia Pulse & SWS
    12. Hacienda Luisita/SCTex illegal toll fee
    13.ineffective com group (includes Mislang)
    14.pending RH Bill
    15. corruption score worsens based on diff. international intelligence reports
    16. lowest rate of GDP
    17.mounting unemployment problem
    18.undiplomatic verbal spat with China over Spratlys
    19.Porsche/BMW controversy — purchased from a source with a well knowned smuggler in BOC
    20.P6-billion illegal tax write off given to Mirant and Team Energy
    21.people suffering from higher cost of living and having depress wages
    22.controversial appointees (eg. BNP – Diokno, LTO -Torres, BoC – Alvarez, PCSO – Tolentino & Joaquin)
    23.core inflation rate increased from 3.9 to 4
    24.biggest drop of visitor arrivals from 377, 672 to 317,443
    25.slow action on OFW repatriation during Middle East Crisis
    26.underemployment rate increased from 0.178 to 0.194
    27. increased of poverty incidence
    28. dropped imports from USD 4, 568 to USD 5, 497
    29. BIR and BOC’s failure to meet their respective revenue targets
    30. imposing double vat on toll
    31.failure to stop jueteng
    32.excessive and unproductive travel abroad
    33.former AFP Chief and Defense Sec. Angelo Reyes suicide due to Senate pressure
    34.corruption still rampant in national and local level
    35. PPP zero investment
    36.deteriorating condition of education
    37. no wage increase despite the rocketed cost of basic commodities
    38.billion lost in revenue due to missing container vans
    39.very unproductive legislature under pnoy’s admin
    40.missing in action during the typhoon
    41. slow action and ineptness on crisis/disaster management
    42. 9.43 billion flood damage due to cancellation of flood projects in Central Luzon
    43.increased pork barrel and CCT budgets and cut the budget on education.
    44.failed CCT program
    45.failed Pantawid Pasada Program
    46. increased crime rate
    47.P-noy’s 1.46 Billion intelligence fund for 2011
    48.controversy on Apple MacBooks worth 1.67 million or P67,000 each for Carandang’s staff
    49.rising cases of impunity for extrajudicial killings and enforced disappearances
    50. 4 billion peso damage claim of Belgian dredging firm for cancellation of project
    51.influencing a recent SC decision on family-owned Hacienda Luisita
    52.postponement of ARMM election
    53.DBP lawyer suicide due to harassment
    54. Lopez Holdings 1.6 Billion peso DBP loan written off
    55. secret meeting with MILF leader Murad
    56. 5 million pesos aid to MILF
    57. apathy to the sacrifice of our soldiers who are losing their lives in Mindanao
    58. 31 million pesos aid to (not existing) ABB
    59. 5-10 million bribe to congressmen to back up steps taken against GMA
    60. imposing tax on SSS & PAG IBIG contributions
    61. close to P1M cost (P860,000) of single Palace-Ledac meeting
    62. besmirching the name of the highest court, notably the Chief Justice
    63. blatantly defying The Philippine Constitution
    64. Appointment of Biazon and Lim to BOC to silently gather FUNDS for the next election.
    65. De-Lima finally learned the correct ‘daang matu-weed’ as she made an 
    ‘error recommendation’ during the luneta hostage fiasco.
    reposted from FantasticNoy

    66. railroaded impeachment proceedings against CJ Corona.
    67. went partying while Sendong victims were dying.
    68. promised zero calamity casualty = 3000+ died during typhoon Sendong.

    69. distribution of billions of road users tax to Tongressmen without programs of work.
    70. DOJ flak in P160 million casino scam
    71. poverty and unemployment increase
    reposted from Igorotak

    72. high electric and water costs
    73. Aquinomics is the worst economic plans making Philippines the worst performing economy in Asia.

    • http://pulse.yahoo.com/_NKKIC5MECP6ZUDJAAVB7Y5BDOA ALLAN A

      ANSWER :

      1. CORONA ISSUE 
      2.HEARSY WITHOUT BASIS
      3.FORCE  MAJEURE
      4.WITHOUT BASIS
      5.ITS A PRIVILEDGE
      6. WITHOUT BASIS
      7. YOUR ENVEY ONLY
      8.BY REASON OF FAIRNESS AND JUSTICE
      9.EXCUTIVE PRIVILEDGE NOT BEYOND YOUR AUTHORITY TO QUESTION
      10. HEARSAY
      11. HEARSAY
      12. WITHOUT BASIS
      13. YOUR ONLY ENVY
      14 – 73 . YOUR ACCUSATIONS WITHOUT MERIT , WHIMSICAL , UNETHICAL, CLEARLY ONLY A COMMENT OF A PERSON WHO IS BIASED

      P-noy is better than GLORIA ……..

      • dead_pixel

        @Allan a
        those are obviously yellow answers.
        and noyAbnoythePartygirlboy is the worst president in the making.

  • im_not_convinced

    major fail. at the very least, Fajardo is no longer tying to convince us that the 2nd half of 2011 under Penoy would be good.

  • jericxx

    What do we expect from a simpleton of a president?  Or a student council type of administration?

  • http://pulse.yahoo.com/_E3CE56OQVPC4RPYD2NR4VD3SUE Bert

    The economy has never been the priority of Pnoy. It will always be arroyo, corona or even palparan…..an anemic 3.2% growth this quarter and the worst is still to come, if the INCOMPETENCE continues…..

  • http://pulse.yahoo.com/_2WR4C4UEXKKVSJZWDL3FINNRQU Buddha Follower

    Aquinomics = Hacienda Luisita, NO MORE NO LESS

  • http://pulse.yahoo.com/_QZZKXPEA67I7HELEIYM35QVYFA Jon

    Aquinonomics
    = Palpaknomics
    = Palustonomics
    = Katawa-tawanomics
    = BiliCongressmennomics
    = TulongNPA/MILFnomics
    = Gutomtaongbayanomics
    but most of all, Cluelessnomics

    • http://pulse.yahoo.com/_NKKIC5MECP6ZUDJAAVB7Y5BDOA ALLAN A

      JON I TELL YOU SIMPLY YOUR CRAZY

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