Atin Ito First Filipino Community Newspaper in Ontario
Managing the economy is clearly the government’s top priority. In his second State of the Nation Address (SONA), President Ferdinand R. Marcos, Jr. focused on the administration’s programs to carve pathways of sustained growth amid continuing global challenges in the post-pandemic period. Sound monetary and fiscal policies underpin the government’s response.
The National Statistician’s latest report shows the continuing decline of inflation to 4.7 percent in July 2023, the lowest in 16 months, that is attributed to “the slower movement of housing, water, gas and other fuels.” This was quickly overshadowed by the steep rise in oil prices last week, rice supply constraints and surging domestic food prices on the back of two typhoons and heavy flooding brought on, too, by continuous monsoon rains.
Newly-installed Bangko Sentral ng Pilipinas Governor Eli M. Remolona has signaled that the Monetary Board will likely consider an increase in its benchmark rates to cushion the supply side shocks in the Monetary Board’s next meeting. Equally important is the need to fill up two vacancies in the Board, arising from the retirement of Governor Remolona’s predecessor and his elevation to the BSP’s top position.
Complementing the BSP’s moves on monetary policy are the fiscal policy initiatives. Last year, both houses of Congress adopted through a Joint Resolution the administration’s Medium Term Fiscal Framework (MTFF). A key component is the National Expenditure Program (NEP) that becomes the government’s budget when approved as the General Appropriations Act.
In 2022, the 7.6 percent GDP growth exceeded targets; GDP growth from 2023 to 2028 is projected at 6.5 to 8.0 percent. With the poverty rate reduced to 9 percent, the Philippines is envisioned to become an upper-middle income economy by the end of the current administration’s term in 2028. Congress has committed to pass necessary legislation to enable the attainment of the MTFF goals.
“Where the rubber meets the road” is in the execution of programs by national government agencies and local government units (LGUs).
Agriculture is a focal point, especially considering that President Marcos has opted to assume this portfolio. One of the most applauded messages of his second SONA was his vow to go after smugglers and hoarders of basic food products. Ease of doing business also remains a priority concern. Many LGUs still need to be prodded to cut excessive red tape and apparent overzealousness in regulating the issuance of business permits — seemingly clueless about how this turns off potential investors and stifles the growth of micro-, small, and medium enterprises (MSMEs) that the government is also seeking to promote.
After approving the 2024 budget, Congress must enact the priority bills that will enable the attainment of the MTFF goals, such as the excise tax on single-use plastics, Value Added Tax (VAT) in digital services, rationalization of the mining fiscal regime and the motor vehicle user’s charge or road users tax. Additional revenues to be collected will complement the Bureau of Internal Revenue’s intensified drive against tax evaders to raise the level of tax collection for a national economy on the rise.
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Credit belongs to : www.mb.com.ph
