WATER shortage and delayed infrastructure projects are considered threats to the country’s economic performance next year, according to the National Economic and Development Authority (Neda).
However, Socioeconomic Planning Secretary Ernesto Pernia said growth will remain robust and the controversy created by the review of the concession agreement with two private companies will not dampen the appetite of investors in the country.
“Of course, the trade war between the US and China is still continuing although it has softened a bit and we hope it would soften further. And then of course [there’s] our natural disasters which are a common phenomenon in the Philippines [including a] possible water shortage in the summer months,” Pernia said.
The Neda chief remains optimistic that the full-year growth target of 6 percent to 6.5 percent can be achieved. GDP growth in the fourth quarter could also average 6.7 percent.
In 2020, Pernia said the GDP growth target of 6.5 to 7.5 percent will also be achievable despite the headwinds he cited.
Neda Undersecretary for Policy and Planning Rosemarie G. Edillon said private consumption will remain the strength of the Philippine economy.
Edillon said the growth of the domestic economy fueled by consumption will “more than make up” for external headwinds, such as the US-China trade tensions.
“Private consumption will be really robust given the slow inflation, especially food inflation, [and] the government consumption, as we have seen, showed there was really a catchup,” Edillon said. “We know that external demand is [quite] slow but domestic demand will more than make up for it.”
Neda Undersecretary for Regional Development Adoracion M. Navarro said the National Water Resources Board (NWRB) will meet this week to discuss the water shortage in Angat Dam.
The NWRB is responsible for all water resources in the Philippines. It coordinates and regulates water-related activities in the country that affect the physical environment and economy.
Navarro said the water shortage is part of the tail end effects of the El Niño phenomenon this year. The meeting aims to engage agencies, especially those in charge of food and water security, to create interventions.
Image credits: Nonie Reyes