PH won't go into recession - Diokno
The Philippines will not go into recession, the country’s top economic manager said yesterday.
Finance Secretary Benjamin Diokno made the statement when asked about the Department of Finance’s plans to mitigate the looming global recession during a Commission on Appointments (CA) committee hearing on his ad interim appointment.
“I can assure you, given the data that we have, under very extreme conditions, we will not have a recession because we have a very young population,” Diokno said.
“For example, our unemployment rate is now down to five percent — that is the lowest since before the pandemic. So I can assure you, given our focus on agriculture, restored mining, the power industry, and manufacturing are working well, plus we have opened up the overseas workers, we have increased the quality of our overseas workers, I don’t think we will have a recession,” he added.
CA majority leader Luis Raymund Villafuerte, who raised the question during the hearing, said while the projected economic growth is “very good,” the country still needs to consider the global economy.
Diokno, in response, explained that the Philippine economy is “less dependent” on external factors.
“Our economy is more or less a domestic-driven economy,” he said.
The DOF chief likewise reiterated that the country’s debt is still manageable.
“Our public debt is manageable, let’s put it that way. It should not be a cause for concern,” Diokno told the CA panel.
Further, he said that the government has a “very strong” economic strategy in the next six years.
This strategy includes higher revenue targets and stricter spending policies.
“So, [with] higher revenues [and] stricter on the expenditure side, I think we can manage our debts,” he said.
As of end-September this year, the debt-to-gross domestic product (GDP) ratio — the amount of the government’s debt stock relative to the size of the economy — rose to 63.7 percent from 62.1 percent in the second quarter of 2022.
This is the highest debtto-GDP ratio since 2005, when it hit 65.7 percent, well over the internationally recommended threshold of 60 percent.
Meanwhile, the country’s debt swelled to a new record high of P13.517 trillion as of the end of September 2022, as the government issued securities to raise funds to support the budget, coupled with the peso’s weakening against the US dollar.
Diokno earlier announced that the administration aims to bring down the debt-toGDP ratio to 52.5 percent by 2028.