PH says 2012 budget deficit may be smaller than target

Reuters

Posted at Nov 21 2012 08:54 PM | Updated as of Nov 22 2012 04:54 AM

MANILA - The Philippines' budget deficit this year may be smaller than target, but it should at least hit 2.3 percent of GDP, with the government bent on accelerating spending to help spur economic growth.

The Southeast Asian country, criticised for weak spending that pulled down overall economic growth in 2011, committed to increase and speed up expenditures to help meet this year's 5 to 6 percent economic growth target.

It had set a budget deficit target of 2.6 percent of gross doemstic product (GDP) in 2012, wider than the previous year's 2.0 percent budget gap.

"This year's budget deficit will not fall below 2.3 percent of GDP," Budget Secretary Florencio Abad told reporters.

Abad said the budget deficit could still widen once they get the go ahead from President Benigno Aquino to accelerate expenditures.

"We are hoping to rocket it (spending) up," Abad said.

Manila's budget shortfall in the nine months to September reached P106.06 billion ($2.58 billion), or just 38 percent of the full-year budget gap goal.

While the state revenues and spending in the first nine months of the year were higher from a year ago, they were behind programme.

Revenues of P1.12 trillion in January to September compare with the goal of P1.17 trillion, while spending of P1.22 trillion in the same period were below the P1.35 trillion goal.