RP wared over economy

RP wared over economy

MANILA (AFP): The International Monetary Fund (IMF) has warned
the Philippines of emerging imbalances that threaten to derail
its fledgling economic recovery, a confidential document
published here Saturday showed.

The document obtained by the Manila Chronicle newspaper hailed
the 5.07 percent growth in the first semester, but urged that the
ballooning trade gap, nearly double-digit inflation and negative
real interest rate be addressed.

Philippine officials were not immediately available for
comment, but the frank assessment shows that tough times lie
ahead for Manila as it strives to catch up with its more
prosperous Southeast Asian neighbors.

"Despite the early stage of the current economic recovery,
there are several signs which suggest that such imbalances may
already be emerging," an IMF review team that recently visited
Manila said in the memorandum to Philippine officials published
by the daily.

The panel noted that the trade balance had "deteriorated
sharply" to a US$4 billion deficit in the six months to June --
equivalent to 13.5 percent of gross national product (GNP).

While export performance considerably grew at 17 percent,
imports expanded 26 percent year on year, it added.