MANILA — Philippine economic managers maintained a growth target of 6 to 7 percent for 2023 but also raised the inflation forecast for the year.
The Development Budget Coordination Committee on Monday said the government still expects 6 to 7 percent GDP growth despite the possible global economic slowdown.
The DBCC also set a growth target for 2024 to 2028 of 6.5 to 8 percent.
The Philippine economy exceeded targets in 2023, growing by 7.6 percent.
"We maintained our growth targets at 6 to 7 percent for 2023 and 6.5 to 8.0 percent for 2024 to 2028 in consideration of the risks posed by geopolitical and trade tensions, possible global economic slowdown, as well as weather disturbances in the country," the DBCC said.
To fuel growth, the DBCC said the country would focus on modernizing agriculture, expanding agri-business, encouraging private sector participation in infrastructure development, promoting digital transformation and enhancing the competitiveness of local industries, among others, in line with the Philippine Development Plan 2023 to 2028, it said.
Meanwhile, the DBCC said it has increased its inflation outlook to 5 to 7 percent average this year from 2.5 to 4.5 percent as high prices of food, energy and transport costs persist.
The government's Inter-Agency Committee on Inflation and Market Outlook (IAC-IMO) is committed to implementing an all-of-government-approach to alleviate inflation and to return to the 2 to 4 percent target range between 2024 to 2028, the DBCC said.
"As we strive to sustain our high-growth performance and achieve a truly inclusive and sustainable economy, the DBCC is committed to taking proactive measures to bring inflation back within the target range while developing physical, social, and digital infrastructures to gear up the Philippines for more investments and opportunities that every Filipino can enjoy," the committee said.
Meanwhile, the peso-dollar exchange rate assumption for 2023 was adjusted downwards to $53 to $57 and is expected to remain at the same level until 2028, it added.
Revenue collections in the medium term are expected to improve to P6.62 trillion in 2028 from P3.73 trillion in 2023, the DBCC said, as the government implements new revenue measures such as the Passive Income and Financial Intermediary Taxation Act, VAT on digital service providers, and excise taxes on single-use plastics and pre-mixed alcohol.
Budget disbursements were also revised upwards and sustained above 20 percent of GDP, which was at P5.23 trillion in 2023. It is projected to expand to P7.77 trillion in 2028, the DBCC said. Fiscal deficit is seen to decline to 3 percent of GDP in 2028, from 6.1 percent of GDP in 2023, it added.
"This will enable the government to implement priority programs and strategies outlined in the 8-point Socioeconomic Agenda and the PDP 2023-2028," it said.
The DBCC said it is also expecting to achieve its goal of reducing poverty level to single-digit levels before the end of the current administration.