PH en route to strong economic rebound despite 'black swan' pandemic

Jessica Fenol and Arianne Merez, ABS-CBN News

Posted at Jul 08 2020 05:28 PM

PH en route to strong economic rebound despite 'black swan' pandemic 1
Security personnel monitor the entrance to the Metro Rail Transit (MRT-3) Boni Avenue Station on July 07, 2020. Jonathan Cellona, ABS-CBN News

MANILA -- The Philippines is on its way to economic recovery President Rodrigo Duterte's top officials said Wednesday even as the country continues to fight the coronavirus pandemic.

Executive Secretary Salvador Medialdea along with the country's economic managers presented Wednesday measures undertaken by the government to resuscitate the economy, which shrank for the first time in 22 years due to the COVID-19 crisis.

"As we transition to the new normal, your government’s pagkalinga (care) will take the form of a strong economic rebound. We shall save and restore as many livelihoods as we can," Medialdea said in a forum that served as a primer for President Rodrigo Duterte's penultimate State of the Nation Address this month.

"The whole of government is working round the clock to minimize the socio-economic impact of this pandemic, and to ensure our sustainable recovery," he added.

The economy could contract by as much as 3.4 percent this year, government estimates showed while analysts predicted more job losses as the pandemic drags on.

In April, unemployment ballooned 17.7 percent which translates to some 7.3 million jobless Filipinos.

While the coronavirus disease (COVID-19) pandemic was a "black swan" event, Finance Secretary Carlos Dominguez III said the government responded "with everything we had," and was able to prevent millions of possible infections.

President Duterte in mid-March placed the entire island of Luzon, home to nearly half of the Philippines' 100-million population, under strict lockdown to control the spread of COVID-19.

It was only last month that virus restrictions were largely eased as the government moved to resuscitate the economy dragged down by the pandemic lockdowns.

Citing epidemiological models by FASSSTER Project in April and the University of the Philippines COVID-19 Pandemic Response Team, Dominguez said "government interventions such as the lockdown helped prevent as much as 1.3 to 3.5 million infections.” 

Recent weeks, meanwhile, have seen a soaring number of COVID-19 infections, with confirmed cases now over 47,000.


PH en route to strong economic rebound despite 'black swan' pandemic 2
A health worker gives instructions to a suspected patient at the San Juan COVID-19 Kalinga Center. Gigie Cruz, ABS-CBN News/File

As the pandemic persists, Budget Secretary Wendel Avisado assured the public that the country has enough funds to respond to the crisis.

"Totoo po na may sapat na pondo ang pamahalan upang tugunan at labanan ang COVID-19 pandemic at ito nga ay napatunayan nung pinasa ng kongreso ang Bayanihan to Heal as One Act," Avisado said. 

(It's true that the country has enough funds to respond and fight the COVID-19 pandemic. This was proven when Congress passed the Bayanihan to Heal as One Act.)

The government has so far disbursed P374.8 billion to help Filipinos fight the pandemic, Avisado said.

Dominguez added that the Philippines can borrow more funds at low rates and with longer payment periods, with its good credit ratings, noting that "debt is manageable and affordable to us."


PH en route to strong economic rebound despite 'black swan' pandemic 3
Construction workers repair a portion of Roxas Boulevard in Pasay City on May 1, 2020. Jonathan Cellona, ABS-CBN News

As the government gears its coronavirus response towards economic recovery, President Duterte's P8 trillion 'Build, Build, Build' infrastructure program remains a priority to spur job creation, Public Works Secretary Mark Villar and acting Socioeconomic Planning Secretary Karl Chua said in the same forum.

"It remains on track. In terms of delivery, I'm certain we'll be able to deliver," Villar said.

Officials earlier said that hiring construction workers is expected to boom as the government goes full blast with the infrastructure push.

With more areas of the Philippines transitioning to more looser community quarantines, the government is also working to jumpstart tourism--starting with domestic travel.

The Department of Tourism is already looking at possible local destinations that can be reopened, its undersecretary, Arturo Boncato, said.

"Domestic tourism should be the catalyst of restarting the industry all over the Philippines," he said.

Earlier, Tourism Secretary Bernadette Romulo-Puyat said the government was eyeing the adoption of travel bubbles that would allow international tourists from virus-free countries to visit select tourist spots in the Philippines that have only a few cases of the virus.

Among the destinations being considered for travel bubbles are Bohol, Boracay, and Palawan, since these have low cases of COVID-19.


PH en route to strong economic rebound despite 'black swan' pandemic 4
Residents from Barangay Batasan Hills in Quezon City line up to receive cash under the social amelioration program amid the enhanced community quarantine on May 4, 2020. Mark Demayo, ABS-CBN News/File

With the reopening of the economy, Executive Secretary Salvador Medialdea reminded the public to act responsibly since the threat of the virus remains.

"As we help our citizens return to work, each and every Filipino needs to remain vigilant. We should all continue observing social distancing and other public health measures such as wearing of masks and frequent washing of hands to protect each other’s health and well-being," he said.

Boosting economic activity is a matter of "national survival," finance chief Dominguez said, as he noted the importance of keeping Metro Manila and the Southern Tagalog Region open as the two regions make up most of the country's economy at 67 percent.

"While the people's health and safety remain a priority, we cannot keep on retreating from the virus at the cost of our livelihoods," Dominguez said.

"We need to strike a reasonable balance between safeguarding public health and restarting our economy," he added.

Metro Manila, home to roughly a tenth of the Philippines' 100 million population, accounts for a third of the country's gross domestic product while neighboring Southern Tagalog region serves as home to several economic zones and industrial plants.

While the economic outlook remains bleak this year, Bangko Sentral ng Pilipinas Gov. Benjamin Diokno said the gross domestic product could grow from 8 to 9 percent in the coming years.