The Philippines' Finance Secretary on Tuesday rejected forecasts by the World Bank that Manila would fall into a recession this year. "We're focused and I think we can hit 0.8 percent (gross domestic product growth)," Margarito Teves told reporters. "The likely scenario is 0.8 percent growth," he said, adding that this was already a conservative projection.
Reacting to reports that the World Bank had projected a 0.5 percent contraction this year, Teves said: "They are probably cautious." Earlier this month, the International Monetary Fund had forecast the Philippine economy would shrink by 1.0 percent this year. Teves conceded that while a recession was "possible," all indicators pointed towards modest growth, adding that Manila would continue with its increased spending to stimulate the economy.
But he said both sectors would do better than the Bank expected. The Philippines relies heavily on the remittances of about nine million Filipinos working overseas but there are fears many of them will lose their jobs due to the global financial crisis.
But Teves said at worst remittances would remain flat as many Filipinos continued to find jobs abroad, while earlier this month, the central bank said the amount sent home in the first four months rose 2.6 percent year on year. Total exports in the first four months of the year plunged 36.4 percent from a year earlier to 10.727 billion dollars.
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