The nation aims to speed up state spending growth to about 15 percent in the months ahead after a contraction in the first quarter due to a budget delay.
Budget Assistant Secretary Rolando Toledo, 55, said in an interview on Thursday, “We’re confident the implementation of the catch-up plan will help boost growth,” Government agencies are to submit revised monthly spending plans including “shovel ready” projects as the department maps out an accelerated disbursement program, he said.
Toledo stated seeing a year-on-year spending growth of at least “mid-teens” once the plan is in place. State spending, not including interest payments, fell a percent in the first three months of 2019.
Grants for the poor and salary hikes are most likely to fuel the increase in outlays starting this month after President Duterte signed the 2019 budget law only in April, Toledo said. That could help counter the impact of the spending ban on projects ahead of the May 13 legislative elections. Allocations for new infrastructure will help boost disbursement in the third quarter, he added.
Slowing global economy and the risks of heightened trade tension are forcing many Asian nations to look for domestic sources of growth. In the country that could mean whichever ramping up state outlays or cutting the key interest rate as soon as the next week.
Budget delays are likely cut first quarter gross domestic product growth by as much as one percentage point, prompting a reduction to this year’s growth target band by a point to 6 percent to 7 percent. The government will announce last quarter’s growth on May 9.
The budget department are to submit a P4.1-trillion ($79 billion) spending proposal for 2020 to Congress as early as July, Toledo said. The budget bill will include provisions for universal health care and the expansion of the autonomous region in the nation’s Muslim-majority south.