Economy to grow by 7% – DOF

THE economy is expected to have grown by at least seven percent during the third quarter on the back of strong exports and sustained “investment optimism,” according to Finance Undersecretary Gil Beltran.

Beltran yesterday said the third quarter growth prospect is “very good” and could be higher than programmed five percent to six percent for the months of July to September.

“I might be higher than 5-6 percent. Seven percent would not be disappointing,” Beltran said in an interview.

The economy grew 1.1 percent in the third quarter of last year.

He said one of the possible growth drivers of the gross domestic product (GDP) in the third quarter would be the export sector, which posted an expansion of 36.6 percent in August.

“There’s investment optimism. It’s more of confidence than anything else,” Beltran said.

He said investment optimism is felt more in the construction sector and in the local stock exchange and even in the bond market.

Beltran noted that the rise in the share index of the Philippine Stock Exchange (PSE) is being fuelled by good corporate profits.

“Corporate numbers are all up 20 percent,” he said. Beltran said the fourth quarter growth would also be stronger based on the previous strong economic growths registered in the three quarters.

“When your first quarter growth is strong, the Q4 growth moves up a little bit more,” he said. He said even the whole year gross domestic product (GDP) growth would exceed the goal. “I’m sure the whole year will exceed six percent,” he said.

The government has programmed a full year GDP growth of  5 percent to 6 percent while other banking and credit rating institutions have predicted a more optimistic growth range of seven percent to eight percent.

Beltran said the expected GDP growths in third and fourth quarters would also enable the government to contain its deficit ceiling of P325 billion or 3. 9 percent of the GDP.  Dino Ng

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