By Beatrice M. Laforga, Reporter
THE National Government is optimistic it will be able to meet its infrastructure spending target this year, as part of the catch-up plan to lift fourth-quarter gross domestic product (GDP), a Department of Budget and Management (DBM) official said.
“We are optimistic that we can hit the full-year target in the remaining two months of 2020. We are expecting infrastructure spending to catch up by yearend to P824.9 billion or 4.5% of GDP compared to the 4.3% forecast in July,” DBM Assistant Secretary and Spokesperson Rolando U. Toledo told BusinessWorld in a Viber message on Friday.
He said the spending boost will come from the Public Works and Transportation departments in the last two months of 2020.
“The DBM is currently actively coordinating with both agencies and other line agencies and prompting them to catch up their spending targets,” Mr. Toledo added.
Infrastructure spending reached P508.5 billion in the 10 months to October, down 18.4% year on year, the latest DBM data showed. In October alone, infrastructure and other capital outlays fell by 30.6% to P57.1 billion.
Mr. Toledo said the 10-month tally only accounted for the National Government’s total spending and does not include the disbursements made by the local government units and subsidy to state-owned firms, “which are also substantial.”
The 10-month capital outlays, which includes the equity given to state-owned firms, and transfers to local governments for their infrastructure projects, were still down 11.8% year on year to P663.2 billion. The tally accounts for 80% of the P825-billion target for the year.
The government raised its infrastructure spending goal by 5% to P825 billion from the reduced target set in July. Despite the increase, this is still 16.6% lower than the original P989-billion pre-pandemic spending goal.
Higher infrastructure spending is part of the government’s program to help the economy recover faster from the recession.
Economic managers expect the economy to contract by up to 9.5% this year, before posting 6.5-7.5% growth next year and 8-10% growth in 2022.
For next year, the target spending for the infrastructure program was increased by four percent to P1.17 trillion.