High oil prices threaten Philippines' economic growth in 2005:IMF

Hong Kong (Platts)--5Oct2004

Philippines' relatively high heavy oil imports dependence compared to other
ASEAN members is threatening its economic growth in 2005 as global oil prices
rose above the $50/bbl level, the International Monetary Fund said. "We expect
growth (in the Philippines) for 2005 to be moderate partly because of the
uncertainty in the direction of global oil prices and problems in handling the
fiscal conditions," a IMF official said. The government is also facing a huge
budget deficit of around Peso 11.7-bil ($208-mil). The Philippine National
Economic Development Authority earlier predicted that the country's forecasted
4.5%-5.5% economic growth in 2005 would fall by a minimal 0.6 percentage
points if oil prices continue to average around $40/bbl. The body has yet to
revise its earlier forecast. The government is pushing a huge initiatve to cut
dependence on oil imports to cope with rising oil prices. Manila plans to
double its capacity based on renewable energy from the current 4,500MW, or 37%
of the total, to 9,000MW or 60% of the total by 2013.

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