From the News! – Your Daily News

Reuters
Inquirer.net

MANILA, Philippines – (UPDATE 2) Annual inflation eased to a 10-month low of 7.1 percent in January on declining food and oil prices, the statistics office said Thursday.

Inflation in December was at 8.0 percent from a year earlier.

Core inflation, which strips out some volatile food and energy items, edged down to an annual 6.9 percent in January from 7.3 percent in December.

Meanwhile, the Bangko Sentral ng Pilipinas, the country’s central bank, said the lower annual inflation in January gave it the flexibility needed to supply the financial system with sufficient liquidity to shield the economy from the global downturn.

“This confirms our expectation for continued slowdown in price increases and gives the central bank more room to support the economy and ensure there is sufficient liquidity for the efficient working of the financial markets,” central bank governor Amando Tetangco told reporters in a mobile phone text message.

Analysts see this as a signal for a further reduction in interest rates of as much as 1 percentage point.

The central bank has lowered rates by a 1 percentage point over the last two months to 5.0 percent for borrowing and 7.0 percent for lending after inflation has steadily come down from a near 17-year peak of 12.5 percent in August.

The central bank will hold its next rate-setting meeting on March 5, the same day February inflation data will be announced.

Joel Guinto
INQUIRER.net

MANILA, Philippines – The government has set a P300-billion “sustainability plan” to fuel economic growth and to protect and generate jobs in the face of the global economic crisis, the full impact of which is expected to hit the country early next year, officials said.

The plan, presented to President Gloria Macapagal-Arroyo at a Cabinet meeting Tuesday, includes building and rehabilitating infrastructure, increased spending for social services,
and an expected increase in capital and consumer spending as a result of reduced corporate and individual income tax rates, Economic Planning Secretary Ralph Recto said.

Budget Secretary Rolando Andaya said the government would give priority to “quick-moving” infrastructure projects that have no right-of-way and other legal issues.

“We presented an economic sustainability plan,” Recto said at a news conference in Malacañang. “It is not a contingency plan. It is not a recovery plan—there is nothing to recover from.”

He said the plant was for “continuing what we have been doing and stretching every peso in the budget to ensure that we save and create as many jobs as possible.”

Recto noted that while millions of jobs were being lost in the United States and China, the Philippines generated about 800,000 jobs this year.

He said Cabinet members were instructed to ensure that the infrastructure projects, such as rehabilitation of roads and construction of hospitals, school buildings and irrigation facilities, would have a multiplier effect so that “more jobs are saved, secured, and
created.”

Local government units will also be encouraged to spend on infrastructure development, he added.

Recto said that despite the global recession, the worst-case projection of the government’s top economic officials was a 3.7-percent growth in the gross domestic product next year, and the high end of the projected range was 4.7 percent.

Reuters
Inquirer.net

MANILA, Philippines — More people landed jobs in October despite the global financial crisis as the jobless rate fell to 6.8 percent in October from 7.4 percent in July.

The percentage of underemployed or those who have jobs but want to work more, also slid to 17.5 percent of total employed in October from 21 percent in July.

Of the 34.53 million people employed in October, almost half were in the services sector, more than a third were in agriculture, and the rest were in the industries sector.

More than half of the employed, or nearly 52 percent, were wage and salary workers, while more than a third were self-employed workers. The rest were unpaid family workers.

Unlike its neighbors Singapore and Japan, the Philippines is not expected to slide into recession with the economy expected to grow at 3.7-4.7 percent in 2009, although slower than the projected 4.1-4.8 percent this year, based on government estimates.

President Gloria Macapagal-Arroyo has vowed to create one million jobs annually but has failed to deliver on that promise due to budget spending restraints as the government tries to rein in the budget deficit.

On Tuesday, Arroyo said slightly more than 1,000 Filipinos had lost their jobs abroad as foreign companies cut costs to cope with the worsening crisis. Those overseas workers are likely to head home, creating further pressure on domestic employment.

About a tenth of the Philippine population work and live overseas, mainly in the Middle East, United States, and in many parts of Asia and Europe to support their families at home.

“We long for the day when we will have enough jobs in the Philippines so that work abroad will only be a career choice…and not the only option for a hardworking Filipino,” Arroyo said in a televised message.

Many of the Philippines’ top corporations said they are not planning to hire more people for expansion next year, the central bank’s fourth-quarter business expectations survey showed.