(File photo)
MANILA – Budget Secretary Amenah Pangandaman on Tuesday urged government agencies to target a “100 percent” infrastructure spending to sustain the country’s economic growth.
“I urge all NGAs (national government agencies) with infra(structure) 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 (gross domestic product) targets," Pangandaman said in a statement.
Pangandaman made the call, as she stressed that the government’s infrastructure spending would boost the country’s GDP growth in the third quarter of 2024.
She said the strong performance of government-led construction projects contributed about 2 percentage points to the 6.3 percent real GDP growth for the second quarter of 2024, a significant rebound from its 0.8 percent performance reported last year.
Pangandaman said infrastructure spending for the next semester would drive higher government disbursements, adding that it would also contribute to faster GDP growth, reaching 6 to 7 percent in 2024 and further increasing to 6.5 to 7.5 percent in 2025.
For 2025, the Build Better More Program will receive an allocation of PHP1.507 trillion or 5.2 percent of GDP.
Based on the budget plan for next year, the Department of Public Works and Highways will get PHP900 billion or 14.2 percent of the proposed national budget.
The Department of Transportation will also receive PHP180.9 billion, a boost of 144.8 percent from its 2024 budget, to fund major transportation projects.
Pangandaman underscored the need to prioritize infrastructure programs that promote physical connectivity such as road networks (PHP489.09 billion) and railway systems (PHP103.28 billion), as well as the construction and improvement of social infrastructure like school buildings (PHP38.81 billion), hospitals and health centers (PHP14.79 billion), water and power supply systems (PHP11.44 billion), and housing facilities (PHP2.12 billion).
Infrastructure spending reached PHP720.5 billion at the end of June 2024, expanding by 18.4 percent compared to the same period last year.
This is equivalent to 5.7 percent of GDP and well within the 5 to 6 percent target of the national government under the Medium-Term Fiscal Framework.
The spending performance also exceeded the government's target of PHP671.3 billion for the first semester, owing mainly to the rapid implementation of public construction projects such as road networks and rail transport and capital outlay projects on defense modernization.
The utilization of infrastructure budget in the first semester also contributed to total government disbursements which increased by 14.6 percent to PHP2.764 trillion.
Government Final Consumption Expenditure was one of the significant contributors to the 6.3 percent GDP growth for the second quarter of 2024. (PNA)
