MANILA - Philippine billionaires on Monday said more government stimulus is needed to revive the pandemic-battered economy, which slipped deeper into recession following an 11.5 percent contraction in the third quarter.
“Government will have to spend in stimulus of at least 20 percent of GDP. That is my opinion. Support MSMEs, provide liquidity. Whether the Central Bank has to follow the footprints of the Fed and ECB and start printing a bit... 20 to 25 percent of GDP is what is necessary for consumption-based economy," said ICTSI Chairman and President Enrique Razon at the Go Negosyo Angat Lahat 15th anniversary Conference.
“Whether it is infrastructure, loans, liquidity. We need a bazooka, not a pistol,” he added.
The Philippines has two pandemic response measures, the Bayanihan 1 and 2 laws meant to provide emergency assistance to individuals and sectors hit by COVID-19.
Finance Secretary Carlos Dominguez III earlier said "consumer confidence" is needed and not necessarily additional fiscal response to see a "strong recovery" in the economy.
Ayala Corporation CEO Jaime Augusto Zobel de Ayala meantime shared more spending is required from both public and private sectors.
“Public and private sector have to work together. We are depleting our resources deliberately in order to survive this. They have been putting stimulus on the table but demand has to kick in. We all have to use our balance sheets to kick start the economy. There is no way around it," said Zobel de Ayala.
Government spending rose 5.8 percent in the third quarter from a year ago, compared with a 21.8 percent surge in the second quarter.
SM Group's Teresita Sy-Coson expressed hope government will open up more areas, and allow less restrictions on movements to encourage freer flow of goods and services.
"We are all doing what we can in our ecosystems. But we also need the government to help, open up areas such as logistics so there is freedom of movement. We also look into testing, safety, face masks," said Sy-Coson, who is Vice-Chairperson at SM Investments Corp.
The government has gradually lifted coronavirus curbs since May after imposing one of the strictest lockdowns globally this year. But analysts worry about the Philippines’ outlook as it struggles to contain the virus at home, while a resurgence of cases abroad threatens the global economic recovery.
--with a report from Reuters