{"id":173237,"date":"2018-07-25T22:52:59","date_gmt":"2018-07-26T02:52:59","guid":{"rendered":"https:\/\/canadianinquirer.net\/v1\/?p=173237"},"modified":"2018-07-25T22:52:59","modified_gmt":"2018-07-26T02:52:59","slug":"imf-sees-sustained-growth-ph-amid-risks","status":"publish","type":"post","link":"https:\/\/canadianinquirer.net\/v1\/2018\/07\/25\/imf-sees-sustained-growth-ph-amid-risks\/","title":{"rendered":"IMF sees sustained growth of PH amid risks"},"content":{"rendered":"

MANILA<\/strong>\u00a0— The International Monetary Fund (IMF) remains positive about the sustainability of the Philippine economy’s growth amid risks such as rising inflation after noting the monetary and fiscal measures put in place by authorities.<\/p>\n

In a briefing Wednesday, Luis E. Breuer, Mission head of the IMF team that visited the country from July 11-25, 2018 for the Article IV Consultation, said they forecast the rate of price increases at 4.8 percent by the end of 2018 and at 3.5 percent next year.<\/p>\n

Inflation is seen to average at 4.7 percent this year, higher than the government\u2019s two to four percent target, but go down to 3.8 percent next year.<\/p>\n

On the first half this year, inflation averaged at 4.3 percent. Last June alone, rate of price increases rose to multiyear high of 5.2 percent from month-ago\u2019s 4.6 percent on account of faster price increases of the food and non-alcoholic beverages index and the alcoholic beverages and tobacco index, among others.<\/p>\n

Breuer said they project the deceleration of inflation rate \u201cin the next few months\u201d even as risks to inflation has increased.<\/p>\n

\u201cThe main message is that we expect inflation to come down in part because you have a number of supply shocks that increased the cost of production that are expected to wean or to become weaker as time goes by,\u201d he said.<\/p>\n

In a statement, the IMF traced the uptick in inflation rates to hikes of oil prices in the international market, the external pressures on the peso, one-off effects of higher excise taxes as a result of the Tax Reform for Acceleration and Inclusion (TRAIN), and of domestic demand pressures.<\/p>\n

The IMF official said the multilateral agency supports the proposed rice tariffication since this is expected to lead to lower rice prices and eventual deceleration of inflation rate.<\/p>\n

\u201cBut in addition to that we believe that other policies need to support this strategy to keep inflation contained and lower in the coming months,\u201d he said citing the importance of both the monetary and fiscal measures.<\/p>\n

Even with the increase of risks to domestic expansion the IMF projects growth, as measured by gross domestic product (GDP), to remain strong at 6.7 percent this 2018 and in 2019, with the flat growth projection for next year reflecting \u201cwhat\u2019s happening outside the Philippines.\u201d<\/p>\n

These external developments include tighter financial conditions, increase in US interest rates, and the uncertainty associated with trade tensions.<\/p>\n

In terms of monetary policy, the IMF official said they support the Bangko Sentral ng Pilipinas\u2019 (BSP) position of \u201ctaking the inflation challenge very seriously\u201d to help bring down inflation to within-target levels next year.<\/p>\n

\u201cWe think that is the appropriate thing to do,\u201d he said.<\/p>\n

On federalism, the IMF official said they will respect decisions of Philippines\u2019 lawmakers on this issue.<\/p>\n

\u201cFrom an economic point of view, from what we have seen in terms of decentralization, fiscal federalism in other countries, this can be a good opportunity but also has risks,\u201d he said.<\/p>\n

He said the move may positively impact on public services \u201cbecause local government officials are likely to understand better the needs of the local population and to adopt public services to those needs.\u201d<\/p>\n

Risks, however, include the transfer of responsibilities such as management of schools, hospitals and other infrastructure to local governments as well as strengthening the capacity of local governments to spend well.<\/p>\n

\u201cIt would not be a new process but it is something that needs to be considered when the decision is made,\u201d he added.\u00a0<\/strong><\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

MANILA\u00a0— The International Monetary Fund (IMF) remains positive about the sustainability of the Philippine economy’s growth amid risks such as …<\/p>\n","protected":false},"author":33,"featured_media":114184,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[19],"tags":[],"class_list":["post-173237","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","mauthors-joann-villanueva","mauthors-philippine-news-agency"],"_links":{"self":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/posts\/173237","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/users\/33"}],"replies":[{"embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/comments?post=173237"}],"version-history":[{"count":0,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/posts\/173237\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/media\/114184"}],"wp:attachment":[{"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/media?parent=173237"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/categories?post=173237"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/canadianinquirer.net\/v1\/wp-json\/wp\/v2\/tags?post=173237"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}