DBCC targets to keep deficit target to 2% of GDP

February 28, 2013 11:21 pm 

MANILA, Feb. 28 — The Development Budget Coordination Committee (DBCC) has announced its commitment to keep the budget deficit target to two percent of the country’s Gross Domestic Product (GDP) in 2014, in line with fulfilling the Aquino administration’s Philippine Development Plan from 2011-2016.

The budget deficit target for 2014, which is equivalent to P266.2 billion, was announced in National Budget Memorandum No. 116, dated 15 February 2013.

The Memorandum sets the macroeconomic assumptions, fiscal targets and department budget ceilings that should guide departments and agencies in crafting their proposed agency budgets for 2014.

“We remain committed to our fiscal consolidation strategy, which should help us reduce our debt stock and create more fiscal space for programs and projects that support inclusive economic growth. Likewise, we intend to further improve the pace, efficiency, and quality of public expenditures,” Budget and Management Secretary Florencio B. Abad said.

Abad clarified that while the budget deficit program has increased nominally over the last three years, the Administration nonetheless expects the country’s debt burden to decrease by an average of 1.2 percentage points per year.

This will bring the outstanding debt-to-GDP ratio down from 50.9 percent in 2011 to 46.2 percent in 2014.

The DBM is also eyeing a P2.29-trillion disbursement program for 2014, which amounts to 17.2 percent of GDP. This represents a significant increase of 15.5 percent or P307.5 billion over the target set for 2013, which was pegged at P1.98 trillion.

“With our proposed 2014 disbursement target at 17.2 percent of GDP, we can refine our strategy for focused, performance-driven disbursements next year. Already, we plan to bolster spending for public infrastructure, as well as drive more investments toward the agri-fisheries, manufacturing, and transportation industries, among other promising sectors,” Abad said.

“We’re laying down the groundwork for sustainable and inclusive growth in the country, beginning with swift, high-impact disbursements. As remarkable as our gains in 2012 have been, much work still needs to be done so we can drive more job opportunities to our shores and attract more foreign investments and international trade. With good governance underscoring our efforts, we’re confident that our fiscal program will indeed translate to real, immediate, and sustainable benefits to all Filipinos,” he added. (PNA)

DSP/PR/ABB

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