Budget gap shrinks as revenues rise in May PHL to fix weak spots in path to $500-B dream
PHL to fix weak spots in path to $500-B dream By D. Nicolas BBernadette S A @BNicolasBM B A C S A Bloomberg A News C
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he national government’s Bloomberg News
HILIPPINES’S ecocumulativeincoming budget deficit nomic secretary HILIPPINES’S incoming ecoas planning of end-May shrankArby senio Balisacan plans to bol-Arnomic planning secretary P107.5 billion year-on-year on ster thesenio economy’s weak spots plans to as bolback at of least aBalisacan more robust revenue hethe targets 6-percent ster the economy’s weak annual spots as collection and a slowdown state growth throughout the term ofinPreshe targets at least 6-percent annual spending. ident-elect Ferdinand the Marcos growth throughout termJr. of PresThBudget e next Ferdinand administration shortfall for themust first ident-elect Marcos Jr. boost investment in agriculture and e next ofadministration must fiveTh months the year narrowed manufacturing and build infrastrucboost investment in agriculture and to P458.7 billion, down by almost ture to grow the and economy between manufacturing build billion infrastruc19 percent from P566.2 re6-8 percent annually to 2028,between Baliture toingrow the economy corded the comparable period in sacan in an interview Wednes6-8 said percent annually to 2028, Bali2021, latest data from the Bureau day. sacan said in an interview Wednesof the Treasury showed. Farm and industry output curday. rently account for less than 40 perBudget deficit occurs when exFarm and industry output curcent of gross domestic product, while rently account for less than 40 perpenditures exceed revenues. cent of gross domestic product, while More revenues were collected
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by thecontributes government during the services the majority. period, posting athose double-digit “I would like to see weakest services contributes the majority. growth of priority 15.46 toweakest reach points the of the adminis“Ias would like topercent see those P1.44 from P1.24 trillion tration,” said 64-year-old, who’s pointstrillion as thethe priority of the adminiscurrently chairman of the of nation’s atration,” year ago onthe the64-year-old, back higher said who’s antitrust currently chairman of the nation’s tax andcommission. non-tax revenues. Consistently growing at the rate antitrust commission. Meanwhile, state expenditures of 6 percent for sixgrowing years will make Consistently at P1.896 the rate from January to May hit Philippines a for half-a-trillion dollar of 6 percent six years will make trillion, up by 4.69topercent from economy, according Bloomberg Philippines a half-a-trillion dollar the previous year’s P1.81 trillion. calculations. economy, according to Bloomberg ThFor e nation’s first-quarter expanthe month of May, the budcalculations. sion 8.3 percent is already getof gap also fellfito P146.8 among billion, Th e nation’s rst-quarter expanAsia’s thanks the sionfastest, of 8.3 percent istoalready among contracting by nearly 27reopenpercent ingAsia’s fromfastest, the pandemic. Still, Marthanks to thebillion. reopenyear-on-year from P200.3 cos’s team challengingRevenues fromfaces the immediate pandemic. Still, year MarMay es:cos’s inflation is atin its fastestthis inchallengthree team faces immediate stood at P304.9 billion, jumping years, budget has widened es: infl ation isdefi at cit its fastest in three by 18.9 percent from P256.4 biland the global outlook dimmed. years, budget defi cithashas widened Still, said the economy lion in the same month last year as and theBalisacan global outlook has dimmed. can expand by at leastsaid 7 percent this Still, the economy more taxBalisacan revenues were collected. canExpenditures, expand by at least 7 percent this however, dipped
by 1.1 percent P451.7 year, within the offito cial growthbillion estifromriding P456.7 billion asfrom primary mate, the recovery the year, within the official growth estispending fell.the recovery record in 2020 from due tothe mate,contraction riding Primary spending, which therecord pandemic. He saidinhe2020 will push contraction dueexto for more targeted support measures cludes interest payments, dethe pandemic. He said he will push tocreased easemore inflin ation’s the poorto for targeted measures Mayburden bysupport 2.32onpercent while ensuring “tight” government to ease infl ation’s burden on the poor P417.9 billion from P427.8 billion finances are managed properly. while ensuring “tight” government in“We thecan same month lastwith year. achieve more less,” finances are managed properly. For ING Bank senior economist he said, adding that a review “We can achieve more withand less,” Nicholas revenue streamlining of improved benefi are he said, Mapa, adding that aciaries review and needed. The nation also cannot collection andofthe slowdown in streamlining benefi ciaries af-are ford removal certain onafexpenditures ahead oftaxes the elecneeded. The of nation also cannot goods proposed some sectors, ford asremoval of by certain taxes on tions due to bans resulted in the hegoods said. as proposed by some sectors, continued narrowing of budget he said.as of end-May. deficit
Experienced economist “Budget deficit continues to exnarBALISACAN willeconomist draw from his Experienced
row given improved perience in crafting a collection. newfrom economic BALISACAN will draw hisTwo exdevelopment plan. takingbe factors this.Before periencedriving in crafting aOne new would economic helm of the antitrust body, served development Before taking increased BoC plan. [Bureau ofhe Customs] helm of the antitrust body, he served collections associated with more
global crude secretary prices. Secaspricey economic planning of ondly, improving economic situathe late president Benigno Aquino as economic planning secretary of tion results in higher collections as from 2016. the2012 late to president Benigno Aquino To sustain growth economic up.” of at from 2012activity toeconomic 2016.picks leastBoth 6 percent, next administrathe the government’s To sustain economic growthmain of at tion must address rednext tape administraandBureau build least 6 percent, the collection agencies—the infrastructure needed attract intionInternal must address redtotape and build of Revenue (BIR) and vestment in manufacturing and ag-ininfrastructure needed to attract the BOC—recorded better collecriculture, said who holds vestment inBalisacan, manufacturing and aagtion as the ofwho end-May PhD inperformance Economics from Univerriculture, said Balisacan, holds a this sity of year. Hawaii. PhD in Economics from the UniverGiven a budget deficit ated During the period, theinfl BIR colsity of Hawaii. bylected pandemic-era support programs, P959 up by Given a billion, budget defi cit9.92 inflperated companies multilateral develby pandemic-era support cent from and P872.4 billion aprograms, year ago. opment agencies may be tappeddevelto companies and the multilateral Meanwhile, BOC’s cumulafinance roads, rail and irrigation, heto opment agencies may be tapped tiveBalisacan revenue take surged by the 28.4 said. finance roads, helped rail andmanage irrigation, he percent to P320.5 billion from Aquino administration’s fl agship said. Balisacan helped manage the P249.6 in the comparable public-private partnership infraAquino billion administration’s fl agship period last year.partnership infrapublic-private
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ON NEW ECONOMIC TEAM’ ON NEW ECONOMIC TEAM’ AMID RISING INFLATION By Bianca Cuaresma
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@BcuaresmaBM
he Bangko Sentral ng Pilipinas (BSP) tightened its monetary policy for the second time this year amid expectations that inflation targets for 2022 and 2023 would be breached. In its monetary policy meeting on Thursday, the BSP hiked the interest rate on its overnight reverse repurchase facility by 25 basis points to 2.5 percent. Accordingly, the interest rates on the overnight deposit and lending facilities were raised to 2 percent and 3 percent, respectively. BSP Governor Benjamin E. Diokno said the Monetary Board mainly considered the rising inflationary pressures in tightening their monetary policy stance during the meeting. In particular, the BSP now expects
inflation to average at 5 percent for this year, revised from its earlier forecast of 4.6 percent in May. The country’s inflation target for this year and next year is at 2 to 4 percent. For this meeting, the BSP also announced that inflation will breach the target for 2023, and is expected to average at 4.3 percent. This is an upward adjustment to their withintarget forecast of 3.9 percent in May. However, average inflation is also seen to subsequently decline to 3.3 percent in 2024. See “BSP,” A2
PEZA TO SPUR FOOD OUTPUT VIA SPECIAL ECONOMIC ZONES By Andrea E. San Juan
QUEEN Pangke Tabora swims in her mermaid suit as she conducts a mermaiding class in front of the Ocean Camp in Mabini, Batangas, on May 22, 2022. For the transgender Filipina woman approaching middle age, seeing her legs encased in vibrant, scaly-looking neoprene three years ago was the realization of a childhood dream. Across the world, there are thousands more merfolk like her—at its simplest, humans of all shapes, genders and backgrounds who enjoy dressing up as mermaids. In recent years, a growing number have gleefully flocked to mermaid conventions and competitions, formed local groups called “pods,” launched mermaid magazines and poured their savings into a multimillion-dollar mermaid tail industry. AP/AARON FAVILA
Plaza noted that despite the years of shooting for sufficiency, THE BRP Melchora Aquino, the second ofEconomic two multi-role response procured by the Philippine government from Japan, is welcomed by the Philippine Coast Guard at the Port Area in Manila on Wednesday, June 1, 2022, completing its maiden voyage from Japan. Constructed by Mitsubishi Shipbuilding Co. in Japan, the ship, named he Philippine thevessels country continues to import after Sora, the Grand Woman ofofthe Revolution during thevessels Spanish colonialbyperiod, is part ofgovernment the Maritimefrom Safety Capability Improvement Project ofCoast the Coast DOMINGO THETandang BRP Melchora Aquino, the second two multi-role response procured the Philippine Japan, is welcomed by the Philippine GuardGuard. at theROY Port Area in Manila on Wednesday, June 1, 2022, completing its maiden voyage from Japan. Constructed by Mitsubishi Shipbuilding Co. in Japan, the ship, named Zone Authority (Peza) is food and remains dependent on after Tandang Sora, the Grand Woman of the Revolution during the Spanish colonial period, is part of the Maritime Safety Capability Improvement Project of the Coast Guard. ROY DOMINGO planning to use around other countries to beef up its B C U. O @caiordinario 12 million hectares of agriculdomestic supply despite having B C U. O @caiordinario tural lands and the country’s millions of hectares of idle lands. he Department of Trade port for EVs. are income-based incentives like the DTI wants to provide timefishing grounds for special ecoShe said these idle lands and Industry (DTI) is tarHowever, Aldaba told the Busiincome tax holiday and duty or bound, targeted, performancenomic zones on agriculture and “must be our focus on how to geting to implement the nessMirror that the agency is tax-free importation of capital based and transparent fiscal and aquamarine to spur domestic utilize responsibly our very incentives strategy for electric “recalibrating” the figure because equipment and raw materials and non-fiscal support in order to food production. fertile lands and rich natural vehicles (EVs) by early next year. “we are reviewing assumptions other fiscal incentives available attract EV and EV parts manuSenatemanufacPresiDrilon moved to elect electronic Majority Peza Director General Chariresources as the country aims Trade Undersecretary Rafathat we used in estimating demand to EVUTGOING and EV parts facturing, particularly B J M N. D C and ourgiven political Vicente Sotto III Leader Juan Miguel Zubiri as the to B. Plaza said food produced to push for a self-reliant, selfelita M. Aldaba presented the forstrengthened EV especially the and panturingdent and charging facilities parts and other strategic compoUTGOING Senate PresiDrilon moved to elect Majority @joveemarie governmental institutions. B J M N. D C and strengthened ourinpolitical and declared at 7:41 Sotto pm ofIII acting Senate Pro Temby the special ecozones will not sustaining and resource-generproposed Electric Vehicle Incendemic and changes consumer through the [Corporate Recovnents, batteries, charging dent Vicente Leader Juan President Miguel Zubiri asstathe “Despite the institutions. many challenges governmental Wednesday asIncentives adjourned sine dieof pore from noon of June 30 at 7:41 pm acting Senate Prountil Temonly boost domestic food supply ating economy.” tive Strategy @joveemarie of the government behavior and other developments ery and declared Tax for Entertions, and thePresident establishment of HE House of Representatives that “Despite happenedthe during tenure manymychallenges the thirdCREATE regular session of thedie July 25,from when the of 19th Congress Wednesday as adjourned sine pore noon June 30 until but will also help prop up the at a on virtual forum on Thursday. along with the assumptions used prises] Act,” she added. testing facilities. ended the asthat your happened Speaker, we have risen and HEWednesday House of Representatives during my tenure See “Peza,” A2 18th Congress part ofof the convenes. theUnder third tregular session the first July 25, when the 19th Congress country’s export receipts. Initially, the DTI aims to provide in estimating fiscal support.” heonPthe roposed Elec18th highlighting ourselves One Conon Congress, Wednesday ended the proven as your Speaker,to webe have risen and Senate, capping what Minority Earlier inSee the day,A2colleagues 18th Congress on the part of the fi rst convenes. “DTI,” a total of P83-billion fiscal sup“Currently, [however] there tric Vehicle Incentive Strategy, its 3-year achievements, including gress, ready to servetoour people,” 18th Congress, highlighting proven ourselves be One Con- Leader Franklin Drilon thatinZubiri had colleagues secured Senate, capping whatdescribed Minority signaled Earlier the day, laws to helpachievements, the country navigate histo colleagues. its 3-year including Velasco gress, told ready serve our people,” asLeader cabinet can handle the emerging scenario,” the In its latest Market Call report, First Metro “one of Franklin the most Drilon productive sesthe “votes” that of majority senators described signaled Zubiri of had secured emerge strongernavigate from “One Congress, ready to scrutilaws toand help the country Velasco told his colleagues. report stated. Investment University of Asia First and the sions” of the chamber, an featSAUDI made who will sitSource: in 19th Senate, a cabinet handle n the emerging In itsCorp. latestand Market Call report, Metro as “one of the most productive sesthe “votes” ofthe majority of senators n US can 54.4840 japan scenario,” 0.4002 then UKthrough 66.8410 n HK 6.9410 n CHINA 8. 1 295 n singapore 39.2904 n australia 37.7193 n EU 57.5732 arabia 14.5209 BSP (June 23, 2022) the Covid-19 pandemic. the national budget, pass through and emerge stronger from nize “One Congress, ready to scrutiOne of the major risks that post the most Pacifi c (FMIC-UA&P) Capital Markets Research remarkable by chamber, the fact that much confisit rmed by Drilon. report stated. Investment Corp. and University of Asia and the sions” of the a feat made matter who will in the 19th Senate, a In Covid-19 his valedictory laws, conduct hearings, the pandemic. speech, nizetothe national budget,totopropass ofremarkable uncertainty is the Russia-Ukraine saidPacifi thecgrowth momentum which gave rise to One to of the the economy major risks that post the most (FMIC-UA&P) Capital Markets Research it was in a pandemic. Zubiri confi appears to be the by the fact that much matter rmednow by Drilon. Speaker Velascospeech, said vide oversight on the implementaIn Lord his Allan valedictory waruncertainty which willtomark its first 100 days. The war thesaid 8.3-percent growth in the fiwhich rst quarter laws, to conduct hearings, to prothe economy is the Russia-Ukraine the growth momentum gave will rise to peers heaped praise on only Zubiri likely candidate to stand ofHis it was in a pandemic. appears now to befor the the 18th Congress was Velasco a key and of oversight laws, and on to generally make Speaker Lord Allan said tion began February 24 this anddays. will The reachwar spillthe over to the second quarter. vide the implementawar in which will mark its fiyear rst 100 8.3-percent growth in the first quarter will SottoHis for his leadership, and laudelection as the next Senate Presi-for peers heaped praise on only likely candidate to stand steady partner of President easier theand next 100began days on 3. FMIC-UA&P Capital However, of the economy in the 18th Congress was aDuterte key and it tion offor laws, to Congress generally and make edSotto in June February 24 this year and Markets will reach spill over tothe theperformance second quarter. and thanked as well theand seven after as Sen. Cynthia Villar, earfor his leadership, laud- dent, election the next Senate Presiinsteady passing lawsof that promoted Research saidoncommodity prices, particularly oil the third and fourth quarters will of bethe determined to continue the legpartner President Duterte itsitleadership, easier for the next Congress and other 100 days June 3. FMIC-UA&P Capital Markets However, the performance economy in “graduating” members of seven the lier touted a strong contender, ed and thanked as well the dent, afterasSen. Cynthia Villar, earprices, could remain elevated until the particularly war in East- oil by the the third policies be implemented the new economic development, work for the sake of our in passing laws thatstrengthpromoted islative Research said commodity prices, andtofourth quarters will by be determined its leadership, to continue thekaleg- chamber, including two other of pilwithdrawing other “graduating” members the announced lier toutedshe as awas strong contender, ernprices, Europecould is resolved. This uncertainty lead economic will greet ened the administration justice babayans,” he added. remain elevated until the will war in Eastby the team. policiesMuch to beuncertainty implemented by thethenew economic development,ofstrengthislative work for the sake of our ka- lars—Drilon and Senate President from the race. chamber, including two other pilannounced she was withdrawing to an ation of above 5 percent in economic managers as the pandemicwill continues and thethe ruleadministration of law, enhanced the ernaverage Europe infl is resolved. This uncertainty willthelead economic team. Much uncertainty greet the He said the ened of justice babayans,” hepandemic added. forced the Pro Tempore Ralph “Walathe nang [There is no] SP race,” lars—Drilon and Recto. Senate President from race. country year. inflation of above 5 percent in the andeconomic commodity prices remain protection of labor andenhanced social welto anthis average managers as theelevated. pandemic continues to be dynamic, and the rule of law, the House Heleadership said the pandemic forced the As his “last offi cial act,” Drilon she told reporters, Pro Tempore Ralph Recto. “Wala nang [Thadding, ere is no]“ISPwant race,” In April, “Thecommodity robustness in the economic country thisthe year.Philippine Statistics Authority and prices remain elevated.recovery, fare, improved of and and proactive. protection of the laborquality and social wel- innovative House leadership to be dynamic, introduced a resolution meant to a simple life” and explained she As his “last offi cial act,” Drilon she told reporters, adding, “I want (PSA) reported that infl ation nationwide increased founded“The heavily on employment gains, should In April, the Philippine Statistics Authority robustness in the economic recovery, increased access to “Despite the lingering threat fare, improved theeducation quality ofand and innovative and proactive. prevent a month-long leadership just wanted to “take care of my adintroduced a resolution meant to a simple life” and explained she to 4.9 percent in April 2022. The average infl ation spillfounded over intoheavily Q2 [theonsecond quarter]. And while (PSA) reported that inflation nationwide increased employment gains, should information, enhanced our health increased access to education and “Despite the lingering threat gap in the aSenate, as the terms of vocacy, agriculture,” heradprevent month-long leadership just wanted to “takesignaling care of my for tothe4.9first four months of theThe yearaverage stood at a tighter fiscal andsecond inflation pose And serious percent in April 2022. infl3.7 ation spill over intospace Q2 [the quarter]. while C A and emergencyenhanced response our system, information, health Sotto and endasatthenoon ofof desire to keep her chairmanship gap in theRecto Senate, terms vocacy, agriculture,” signaling of her headwinds anation economic for the first four months of the year stood at 3.7 a tighterinfiH2 scal[second space half], and infl poseteam serious C A and emergency response system, S “H,” A Butch Fernandez June 30. and Recto end at noon of that committee. Sotto desire to keep her chairmanship of of high-quality the new President’s headwinds intechnocrats H2 [secondinhalf], an economic team S “H,” A June 30. that committee. Butch Fernandez of high-quality technocrats in the new President’s
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HE performance of the Philippine HE performance of thehalf Philippine economy in the second the second half ofeconomy the year in will rest squarely of the yearofwill squarely on the shoulders therest incoming on the shoulderseconomic of the incoming administration’s team, administration’s economic team, according to a local think tank. according to a local think tank. PESO exchange rates
DTI aims to roll out EV incentives scheme by next year
Sotto closes ‘productive’ Sotto closes ‘productive’ PANDEMIC CHALLENGE T PANDEMIC CHALLENGE session; Zubiri next SP? MARKS 18TH CONGRESS session; Zubiri next SP? MARKS 18TH CONGRESS
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PESO EXCHANGE RATES ■ US 52.4120 ■ JAPAN 0.4073 ■ UK 66.0496 ■ HK 6.6799 ■ SINGAPORE 38.2625 ■ AUSTRALIA 37.6004 ■ SAUDI ARABIA 13.9750 ■ EU 56.2643 ■ CHINA 7.8555 Source: BSP (June 1, 2022) PESO EXCHANGE RATES ■ US 52.4120 ■ JAPAN 0.4073 ■ UK 66.0496 ■ HK 6.6799 ■ SINGAPORE 38.2625 ■ AUSTRALIA 37.6004 ■ SAUDI ARABIA 13.9750 ■ EU 56.2643 ■ CHINA 7.8555 Source: BSP (June 1, 2022)