(Updates with spokesman’s comments in fourth paragraph.)
Oct. 10 (Bloomberg) -- Philippine President Benigno Aquino approved a fiscal stimulus package today to spur economic expansion, joining policy makers in emerging markets in taking steps to protect growth as the global recovery weakens.
Aquino will formally announce the stimulus package on Oct. 12, his spokesman Ricky Carandang said in a telephone interview in Manila today after the president met with his economic managers. The government may lower its growth targets, Philippine Budget Secretary Butch Abad said in a separate telephone interview today, without elaborating.
Emerging-market nations are boosting measures to drive growth as the U.S. recovery falters and a deepening European crisis stifles liquidity, threatening to drive the global economy into recession. Brazil, Turkey, and Pakistan have cut borrowing costs in 2011 while Asian central banks including the Philippines have refrained from further interest-rate increases.
“With the stimulus in place, we’ll have a fighting chance at meeting the growth targets,” Carandang said. The government is maintaining its growth assumptions for this year and next, he said, without giving the figures.
Malaysian Prime Minister Najib Razak announced in the country’s annual budget last week that he will distribute cash to low-income families, raise wages for civil servants and boost spending on transportation as overseas demand wanes and elections loom.
Philippine exports dropped for a fourth month in August, according to the median estimate of economists surveyed by Bloomberg News before a report tomorrow.
Growth in the $200 billion economy slowed for a fourth straight quarter to 3.4 percent in the three months through June, compared with a 4.6 percent gain in the January-to-March period. The government had a budget surplus in August, helping narrow the eight-month shortfall to 34.5 billion pesos ($795.5 million) from 228.104 billion pesos in the same period in 2010.
Aquino plans to narrow the budget deficit to 2.6 percent of gross domestic product, or about 286 billion pesos, in 2012, from a target of 3 percent, or about 300 billion pesos, this year.
--Editors: Shamim Adam, Cherian Thomas
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