INCREASED government infrastructure spending is seen boosting the country’s economic growth in the third quarter of this year, a Cabinet official said.
With that, Budget Secretary Amenah Pangandaman urged departments and agencies to fully utilize their infrastructure budgets to help drive economic growth in the third quarter of 2024.
“I urge all NGAs (national government agencies) with infra projects to aim for 100-percent budget utilization so that we will sooner see the fruits of our Build Better More Infrastructure Program while we continue to hit our GDP targets,” Pangandaman said in a statement.
Budget Secretary Amenah Pangandaman. PHOTOS BY J. GERARD SEGUIA
Gross domestic product (GDP) growth came higher than expected in the second quarter at 6.3 percent.
The budget chief emphasized that government spending, particularly on government final consumption expenditure, significantly contributed to the second-quarter growth.
She said that government-led construction projects added about 2.0 percentage points to this growth, a strong recovery from the 0.8-percent contribution last year.
Pangandaman expects infrastructure spending to keep boosting government disbursements, driving GDP growth to a 6.0 to 7.0 percent target in 2024 and further to 6.5 to 7.5 percent in 2025.
As of the first half of this year, the amount spent on infrastructure projects rose to P611.8 billion in the January to June period, 20.6 percent higher than the previous year’s P507.2 billion.
This is equivalent to 5.7 percent of GDP and well within the 5.0 to 6.0 percent target of the government.
For next year, Pangandaman announced that the Build Better More Program would receive a budget of P1.507 trillion, or 5.2 percent of GDP.
The Department of Public Works and Highways is set to get P900.0 billion, representing 14.2 percent of the proposed national budget, while the Department of Transportation will receive P180.9 billion to support major transportation projects.