In the wake of NEDA statistics showing the poor are still with us, the Philippines was cited as a “rising star” in the backdrop of a gloomy world economy by credit rating agency Moody’s Investor Services.
If reforms in governance and business policy are sustained, the economic growth could register between 6.5 percent and seven percent this year and the next, hitting government targets for both years, Moody’s Analytics senior economist Glenn Levine said in a report issued last week. He also predicted the growth rate might rise to 8 per cent in 2015 and 8.5 per cent in 2016.
Other achievements cited were: a low inflation environment, an overnight borrowing rate at a record low, success in containing the budget deficit which led to the country’s first ever investment grade rating from Fitch.
The Philippines recent performance against a weak global scenario shows that good governance is far and away the most important driver of growth in emerging markets, Levine said. The crackdown on corruption and the encouragement of foreign investments, particularly, have worked well, he added.
This glowing report of the country’s economic future came a few days after National Statistical Coordination Board (NCSB) reported that the current poverty incidence in the country remained basically unchanged from that reported in 2006 and 2009.
In a press briefing, NCSB Secretary General Ramon G. Albert said that the poverty rate was estimated at 27.9 per cent in the first semester of 2012, which compared with 28.8 per cent and 28.6 respectively in the same period of 2006 and 2009, represented no significant improvement.
The contrasting back-to-back news on the country’s economic performance invites serious questions whether or how the impressive growth the country is experiencing can trickle down to all sectors, especially those at the base of the pyramid.
Earlier, economic experts and business leaders have pushed for the promotion of more micro, small and medium enterprises, proven to be effective job generators, as a strategy to make growth more inclusive.