MANILA—The Philippines needs to borrow money if it hopes to “jumpstart” its economy after the lockdown in Luzon is lifted, a former government official said Saturday.
Ernesto Pernia, who on Friday resigned as socio-economic planning chief, made the suggestion, as the national economy could register zero or negative growth in the second quarter of the year due to the COVID-19 pandemic.
“Kung kulang, pwede naman tayo makautang, kasi mababa naman ang utang natin, kasi ang utang natin relative sa GDP natin,” he told radio DZMM, adding that the Philippines has a good credit rating.
Pernia explained that applying for a loan is vital to get the economy rolling again if and when the lockdown ends.
“Kailangan din ituloy ’yung nasa budget. Kailangan rin ’yung (utang) para maging tinatawag nating stimulus, para maka-jumpstart sa ekonomiya," he said.
“Hindi maganda na hindi tayo uutang, na bawasan lang ’yung budget sa infrastructure, for example, kasi importante nga ’yung spending saka infrastructure.”
The Philippines earlier secured a $500-million (P25 billion) loan from the World Bank to boost its anti-coronavirus war chest.
According to Finance Secretary Carlos Dominguez, the fresh funding will improve the country's ability to prepare, respond and recover from natural disasters, including health emergencies such as the COVID-19 pandemic.
Before he resigned, Pernia said the economy could contract if the COVID-19 crisis drags on until June.
Luzon, home to half of the country's 100 million people, was locked down on March 17 and the quarantine is scheduled to last until April 30.
Pernia said that even if the national economy registers zero or negative growth in the second quarter, it can climb back “slowly” in the third quarter.
"Makabawi in the sense na maka-positive growth na naman. Maski mababang positive growth rate, pwede na siguro sa third quarter,” he said.
Pernia said that, before his resignation, a technical working group headed by National Economic and Development Authority was created to revive the economy.
“Meron kaming ginagawa sa NEDA tinatawag na anticipatory and forward planning,” he said.
“ ’Yun ang ginagawa namin, ang maka-prepare at maghanda tayo kung panahon na para makabangon ekonomiya.”