The National Government exceeded its target spending for infrastructure by 5% in the first half, data from the Department of Budget and Management (DBM) showed.
According to data from the DBM, infrastructure expenditures reached P507.2 billion in the January-to-June period, surpassing the P483.1-billion infrastructure spending program for the period by 5%.
Infrastructure spending jumped by 7.8% in the first half from P470.5 billion in the same period in 2022.
The National Government disbursed P608.7 billion for actual infrastructure projects in the first six months, 2.6% up from P593.2 billion in 2022.
However, the disbursement for infrastructure projects missed the P618.1-billion target for the period by 1.5%.
The government plans to spend 5.3% of the gross domestic product (GDP) or about P1.29 trillion on infrastructure this year.
“The continued growth in infrastructure spending would remain to be a bright spot in the economy, as it remains high at 5%-6% of GDP, compared with 2% or even less than 2% of GDP 10-20 years ago,” Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort said.
Infrastructure spending growth also offset the low budget utilization of some government agencies in the second quarter, Mr. Ricafort added.
China Banking Corp. Chief Economist Domini S. Velasquez said higher infrastructure spending may help lift economic growth.
“Given the effect of underspending to Q2 GDP, the government will likely be more focused on spending this year’s entire budget in a timely manner,” she said in a Viber message. Mr. Ricafort expects the rate of infrastructure spending growth to remain in high single digits, and faster than GDP growth in recent years.
Infrastructure activities may also benefit from the El Niño weather pattern in the next few months.
“Drier weather is positive for infrastructure activities,” Ms. Velasquez said.
Infrastructure spending is expected to be maintained at 5-6% of GDP until 2028.
Source: Business World