Former Secretary of Socio-Economic Planning Cielito Habito has written in his Monday Inquirer column that all is not well in the Philippine economy. He terms this the bad news.

The growth rate target of 5.7 percent will not be met. There may be an increase in remittances from overseas workers but this is not being spent yet, exports are down, and so forth. In yesterday’s news, current Secretary of Socio-Economic Planning Augusto Santos has acknowledged that the growth rate will be in the range of 4.8 to 5.1 percent.

He mentions, however, that the agriculture sector is improving. And this statement validates what I wrote last December 14 that the economy of Eastern Visayas, which is predominantly agricultural, is doing well.

There is always something to be happy about when a region is mainly agricultural. It is more resistant to downswings in the economy particularly in services and manufacturing.

Nevertheless, I may have spoken too soon about encouraging indicators in agriculture. The recent heavy rains resulting in flooding of ricefields could result in a slight decline in agricultural production in the fourth quarter. The devastated areas are still being assessed but surely a decline in palay production is expected. However, on the whole, no drastic downturn is likely to occur.

The decline in national economic growth this year should be considered in strategies to be adopted next year.

With its financial position in better shape, the national government will have more funds for development projects especially those that will encourage higher agricultural productivity. Policy reforms may also be made in key sectors with still much room for expansion such as tourism and information technology industries.

There is no “meltdown” but the bad news can be turned into challenges to which the nation can respond to make 2006 a better year than 2005 in the area of economic growth.