Thursday, January 30, 2014

GDP number must be transformed into calories - Recto

MANILA-The 7.2 percent economic growth last year is all the more impressive as it was achieved despite a domino of calamities dragging it down.

This is not to say that the economy is fully typhoon-proof or completely earthquake-resistant because misfortunes did dent the final outcome.

Thankfully, other growth drivers made up for the sluggishness of other sectors.

The 2013 economic numbers showed the wisdom of robust government spending and the frailty of hoarding public funds.  

Hopefully, this same mentality will characterize public expenditure management this year. Spending, like leadership, is by example. Government cannot  prod the private sector to spend fast and more if it is spending slow and less.

Good news is that manufacturing is up.  Are these the green shoots of a manufacturing renaissance? Hopefully it is and government should direct both smart money and right policies to industry.

As to agriculture’s feeble 1.1 percent growth, government should make sure that the P92 billion earmarked for agriculture this year would indeed fertilize a sector manifesting early signs of stunting. Smuggled rice should not be our bumper crop.

The newly-issued GDP numbers measure growth but do not gauge how the increment was spread out.  GDP accounting captures the addition of wealth, but not its distribution.

A rising tide must rise all ships.  Sadly, big vessels are not as buoyant as small ones.  And millions of our people with their heads barely out of water cling to thrown lifelines.

By all means, let us congratulate ourselves for a job well done but conscious of the job still to be done and aware of the clouds behind the silver lining, like our people’s hunger for food and jobs.

The last labor survey pegged the unemployment rate at 6.5 percent and underemployment at 17.9 percent.  Self-rated hunger as measured last December was at a disturbing 18.1 percent.

After enlarging the economic pie, the challenge now is how to make sure that everybody will be able to taste it.  Economic growth must be transformed into calories which those who need them more can actually consume.

On this matter, the budget, if properly used, can be a tool for inclusive growth. 

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