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News Hitting poverty rate target ‘doable‘– BSP

Tagapagbalita 

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The government’s goal to cut the country’s poverty incidence rate to 14.5 percent can be achieved if the economy rebounds considerably next year, the Bangko Sentral ng Pilipinas (BSP) said on Wednesday.

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LIFE’S A BEACH This December 2020 file photo shows residents of Manila’s impoverished Baseco Compound relaxing at Baseco Beach. The Bangko Sentral ng Pilipinas said the government’s goal to cut the country’s poverty incidence rate to 14.5 percent can be achieved if the economy rebounds next year. PHOTO BY RENE H. DILAN

In an online broadsheet interview, BSP Governor Benjamin Diokno said that although the government’s desire to attain that goal “was disrupted,” it remained “on the table.”

“I think that’s still doable if we recover next year by around 8 to 10 percent,” he added.

The National Economic and Development Authority earlier said the poverty incidence rate this year could rise to between 15.5 and 17.5 percent because of the impact of the Covid-19 pandemic on livelihoods.

The community quarantines the government has imposed since last March to contain the coronavirus’ spread forced many Filipinos to stay home and from gathering outdoors to avoid infection. They also severely disrupted economic activities, forcing most businesses to suspend operations or, in some cases, close for good.

Poverty incidence reached 16.6 percent in 2018, equivalent to 17.6 million poor Filipinos.

Diokno said the 8- to 10-percent official gross domestic product growth target the government set for next year already took into account the expected wide availability of coronavirus vaccines in the country.

“This projection is based on the assumption that the vaccine will be introduced into the country on a massive scale by the first half of 2022. So anytime that is introduced much earlier is a plus for the Philippine economy,” he explained.

Lingering base effects, the continuation of state projects under the “Build, Build, Build” infrastructure program, and significant remittance inflows from Filipinos abroad could also drive economic growth, according to the central bank chief.

The BSP expects cash sent home by overseas Filipinos (OFs) to expand by 4.0 percent this year and the next. Latest data showed that such remittances climbed by 0.9 percent to $24.63 billion in the first 10 months of 2020.

“This means that this supports the view that OF remittances takes the nature of an altruistic gesture by Filipinos working abroad to help their families here who are in trouble, so that they continue to send money on a big scale,” Diokno said.

The May 9, 2022 national elections could also provide support for economic growth, according to him.

“Historically, [in] every election [year, GDP growth] is 0.5 to 1 percent higher than the base. So if you factor in the 2022 elections, that would mean higher growth for the Philippines economy by 0.5 to 1 percent,” the Bangko Sentral head said.

 
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