Philippines warns budget deficit may exceed limit
A steep economic downturn could push the Philippines' 2009 budget deficit more than 40 percent above the targetted limit, Economic Planning Secretary Ralph Recto warned Wednesday.
He said although the budget could soar to 257 billion pesos (5.3 billion dollars), or 44.4 percent above the set ceiling, the government would be able to handle it with extra borrowing -- unless interest rates shot up abruptly.
Last month the government cut its economic growth forecast to between 3.7 and 4.4 percent and raised the deficit ceiling to 178 billion pesos, or about 2.2 percent of gross domestic product (GDP) to boost spending.
But speaking after a cabinet meeting chaired by President Gloria Arroyo, Recto said flagging government revenues due to the global crisis would cause the budget deficit to hit 200 billion pesos.
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