Duterte plans record P4.2-T budget in 2020 » Manila Bulletin Business

Manila Bulletin Philippines

Breaking News from the Nation's leading newspaper

Tempo

Online Newspaper

Showbiz and Celebrity News

Sports News

World News
News Asia

Duterte plans record P4.2-T budget in 2020

Published

By Chino S. Leyco

The Duterte administration will propose a record P4 trillion national budget for next year, data from the Department of Budget and Management (DBM) showed.

DBM Logo

DBM Logo

Based on the DBM memorandum dated April 12, 2019, President Rodrigo R. Duterte plans to submit to Congress a P4.2 trillion national budget for 2020, higher by 12 percent compared with the enrolled general appropriations bill of P3.8 trillion for this year.

If Congress adopts the initial budget figure approved by the inter-agency Development Budget Coordination Committee (DBCC), the proposed P4.2 trillion budget will be equivalent to 19.9 percent of the economy, as measured by the gross domestic product (GDP).

For 2019, the national government’s unimplemented spending plan is about 19.6 percent of GDP.

Under the proposed 2020 budget, DBM Officer-in-Charge Janet B. Abuel, said that about P343.4 billion is set for payment of prior years’ obligations — comprising largely of 2019’s — that will only be paid next year because of the “transitional two-year implementation of infrastructure outlays this 2019.” The total cash budget for 2020 is pegged at P4.1 trillion, the DBM data showed.

“The Duterte administration will prioritize the acceleration of infrastructure, anti-poverty, and pro-employment spending through strategic infrastructure projects, and by supporting the implementation of recent game-changing laws such as rice liberalization, universal health care, and Bangsamoro autonomy,” Abuel said.

She also defended DBM’s controversial cash-based budgeting along with cash management reforms, which started this year, citing these initiatives have resulted in better planning, swift program delivery and strengthened fiscal discipline.

The acting budget chief likewise said that the reforms, initiated by former Budget Secretary and now Bangko Sentral ng Pilipinas Governor Benjamin E. Diokno, have installed accountability mechanisms between appropriated budget and program outputs.

“The national government will continue to advance its build, build, build program to promote infrastructure development and establish a more solid foundation for sustained growth,” Abuel said.

For 2020, the Duterte administration plans to raise its infrastructure spending to 4.9 percent of GDP or P1.045 trillion from this year’s program of 4.7 percent, equivalent to P909.7 billion.

The DBM’s 2020 budget proposal is based on microeconomic assumptions that GDP will grow by 6.5 percent to 7.5 percent, while inflation will settle at around 2.0 percent to 4.0 percent, and the US dollar-peso exchange rate is about P52 to P55.

The government also expects Dubai crude oil would average $60 to $75 per barrel next year, while the one-year treasury bill rate at 5.0 percent to 6.0 percent.
“On the overall, the DBCC’s outlook for the country’s macroeconomic fundamentals is positive,” Abuel said. “Despite near-term volatilities, these indicators are expected to grow broadly stable over the course of the medium-term.”

Some upside risks to growth will emanate from the recently passed liberalization reforms on agricultural products as well as the easing crude oil futures, and the ongoing infrastructure program of the national government, Abuel said.

“Still, the downside risks posed by weaker investments and widening external trade imbalance will need to be countered by government interventions aimed at enhancing economic productivity and business confidence,” she added.

Related Posts