The Philippines is set to become an ‘upper-middle-income’ economy this year, thanks to the assistance of multilateral lenders such as the World Bank, Finance Secretary Carlos Dominguez III said.
Dominguez said the World Bank’s generous support for the Philippines’ sustainable development programs was a key factor in helping it secure an upper middle-income economy status in 2019, three years ahead of its targeted schedule.
“For many decades, the World Bank helped many emerging economies achieve sustainable development. This year, as the bank celebrates its 75th year, we are proud to announce that the Philippines will achieve the status of an ‘upper middle-income’ nation ahead of schedule. The bank shares much credit for this achievement,” Dominguez said during the Philippine Day Forum held last week at the Grand Hyatt Hotel in Washington D.C.
The event was organized by the World Bank with support from Citi, Standard Chartered Bank and UBS to share with leaders of the American business community the Philippines’ growth story and the progress that the country achieved over the recent years of implementing reforms to power its economy.
Under the Duterte administration, the government had targeted to achieve the upper middle-income status by 2022 and become a high-income economy by 2040. It also aimed to bring down poverty incidence from 21.6 percent in 2015 to just 14 percent by the end of President Rodrigo Duterte’s term three years from now.
Based on the World Bank’s criteria for the fiscal year 2019, an upper middle-income country should have a gross national income per capita of $3,896 to $12,055. The Philippines is currently classified as a lower middle-income country with GNI per capita of $996 to $3,895. High-income economies are those with a GNI per capita of $12,056 or more.
Dominguez said with the resilience it had displayed under an inclusive economy which posted a GDP growth rate of 6.2 percent last year despite uncertainties of a looming trade war, a sharp spike in oil prices and an elevated domestic inflation rate, the Philippines was poised to reach upper-middle-income status ahead of target this year.
“Today, the Philippines is one of the fastest-growing economies in the world. Reaching this milestone in our development story is attributable to many years of hard work—especially in building a strong fiscal position and a bureaucracy honed to the task of catalyzing growth,” he said.
He said that over the last three years, President Duterte had “delivered resoundingly” on his socioeconomic reform agenda that emphasized continuation of pro-market macroeconomic policies, a progressive tax reform program, improvement in the ease of doing business, a more transparent and responsive government, increased investments in our human capital and enhancement of peace and order.
Dominguez said the decreased crime volumes across the board, the establishment of the Bangsamoro Autonomous Region for Muslim Mindanao, a comprehensive tax reform program now reaping benefits for both the people and the government and a massive “Build, Build, Build” infrastructure modernization program demonstrated how the Duterte administration had delivered on its program of government.
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