Tuesday, 18 May 2010

Economists urge 7-9% growth, tag Cabinet bets

BusinessWorld
http://www.bworldonline.com/main/content.php?id=11135

AN AQUINO presidency can reduce poverty if it achieves annual economic growth of 7-9% coupled with reforms in the agriculture sector, economists yesterday said.

In a briefing on recommendations for the next president, Bernardo M. Villegas, professor at the University of Asia and the Pacific (UA&P), said he expected Senator Benigno Simeon "Noynoy" C. Aquino III to start his term with economic growth of 5-7%.

"Increasing the GDP (gross domestic product) by 7% to 9% in the next five years is what we need to eradicate poverty," he said. "We cannot fully eradicate poverty, but I am sure there will be very visible improvements. This is within the reach of the new Aquino administration."
He noted that sustaining this growth level, plus an effective campaign against corruption as promised by Mr. Aquino, would substantially reduce poverty.

The official growth target for this year and the next is 2.6-3.6% and 3.8-4.8%, respectively.
Asked to comment, National Economic and Development Authority (NEDA) director Dennis M. Arroyo said the 7-9% growth goal was "ambitious".

"It would take many years to achieve this growth in GDP. The government must first raise government revenues and address tax evasion to achieve that rate. Also, it is important that the new government address the problems hindering investors from putting up businesses in the country," he said.

"The 7-9% target requires better revenue administration, passing tax laws, and cutting leakages in expenditures."

Rolando T. Dy, executive director of the UA&P’s Center for Food and Agribusiness, said in the same briefing that poverty could also be addressed via farm sector reforms.

"Poverty is an agriculture phenomenon. There are some 20 million Filipinos who live in the rural areas and most of them are dependent on agriculture," he said.

Mr. Dy said the new government must increase jobs in rural areas by promoting investments in agribusiness.

"There is so much land, which are not yet utilized and cultivated. Mr. Aquino must do something about them to increase farm productivity," he added.

Messrs. Villegas and Dy also cited the importance of appointing competent people in the Cabinet.
"The new president must cross party lines. Talents should be drawn from the best and the brightest and must come from various sectors." Mr. Dy said.

Citing pitfalls of the administration of the late former president Corazon C. Aquino, Mr. Aquino’s mother, Mr. Villegas said: "Noynoy Aquino’s government must prevent what happened in Cory’s administration, where everything related to former president [Ferdinand E.] Marcos was thrown away."

Mr. Villegas recommended several individuals to the new Cabinet: former National Treasurer Omar T. Cruz for Finance, former Finance undersecretary Milwida M. Guevara for Education, former Finance secretary Cesar V. Purisima for Trade, Naga City Mayor Jesse Robredo for Local Government and the retention of Tourism Secretary Joseph "Ace" H. Durano.

Messrs. Cruz and Purisima served under the Arroyo administration, while Ms. Guevara served under the Ramos administration.

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