Reforms will…
“The Philippines has been a laggard (in terms of economic growth) for a very long time but the story in the past four years has been a comeback story, and Aquino’s good governance policy, I think, is the most important ingredient,” Purisima continued.
The Philippine economy grew by a disappointing 3.7 percent in Aquino’s first year in office in 2011, blamed to the government’s underspending. However, growth picked up to a strong 6.7 percent in the following year and even quickened to 7.2 percent in 2013.
The country last year eventually received investment grade ratings from global debt watchers, which highlighted the structural reforms undertaken by the government, the strong macroeconomic fundamentals achieved, and the political stability under the current regime.
Despite these gains, Purisima pointed out the relatively high poverty and unemployment rates continue to hound the Aquino administration, as reduction in their levels have been small even with the fast economic growth.
Data from the Philippine Statistics Authority showed poverty incidence fell to 24.9 percent in the first half of 2013 from 27.9 percent recorded in the same period in 2012. This was also a further improvement from the 28.6 percent recorded in the first half of 2009, and the 28.8 percent seen in the first semester of 2006.
However, unemployment rate went up to 7.5 percent as of January 2014 from 7.1 percent in the same period last year.
“The numbers have improved but there needs to be sectoral interventions, particularly in agriculture… We need to improve their productivity… to improve the overall productivity of the country,” Purisima said.
This will entail strengthening agriculture infrastructure across the country to increase farm workers’ wages and bring down food prices, he said.
To adress unemployment, Purisima said the administration will have to boost the manufacturing sectors to create more jobs.
Purisima admitted that significant reductions in the poverty and unemployment rates may never be seen during President Aquino’s term.
“It can never be done in six years… But what’s important is we already set the foundation so reforms are sustained. The important thing is we’re pointed in the right direction and it’s coming in the right time,” Purisima said.