President Duterte’s economic team is scheduled to revisit on Wednesday this year’s growth targets and other macroeconomic assumptions in light of the serious threat to recovery posed by the more contagious COVID-19 strains.
Finance Secretary Carlos Dominguez III told reporters on Tuesday that the meeting of the Cabinet-level Development Budget Coordination Committee (DBCC) would “determine what the future holds in view of this lockdown episode we had.” In May, the DBCC scaled down its gross domestic product (GDP) growth target in 2021 to 6 to 7 percent from 6.5 to 7.5 percent after the prolonged recession up to the first quarter.
While the second quarter returned to year-on-year GDP growth, the Delta Tribe forced renewed lockdowns this month, including the ongoing 15-day Enhanced Social Quarantine (ECQ) in Metro Manila.
“We are facing a crisis unlike any other we have faced before. We have a virus that mutates, ”Dominguez said.
The CFO said the economy’s first line of defense would be the intensified mass vaccination and further investment in the healthcare sector, which would be funded with revenue gains from the tax reform.
“Our vaccination program is proceeding as advertised. We have received about 42.6 million vaccines so far, from March to August 15th. And we have already administered 27.8 million doses, ”he said.
Vaccination, health care
“We have also invested heavily in our healthcare – it seems to be the only logical way we can approach this now. The government is doing everything it can. Fortunately, we passed the tax reform bills early, which were supposed to reduce poverty, and to [generate] money for investment in infrastructure. And it has been a very good buffer for us – if we had not done so, I do not know where we would be now financially, “he added.
In a separate report, the National Economic and Development Authority (Neda), the state planning agency, said that “although the ECQ imposition may temporarily affect employment results in August, the government was determined to maximize this period to speed up vaccination in high-risk areas to safely resume economic activities and job creation. ”
Production, job loss
Neda had estimated that these ongoing more stringent quarantine measures would reduce PD 151 billion from production each week.
In return, 600,000 Filipinos would temporarily lose their jobs and increase the poverty rate by 250,000 people.
Neda said job recovery would continue to be limited without drastic easing of quarantine measures, particularly in Metro Manila.
With the advent of the COVID-19 Delta variant, the government has given priority to stopping the spread of this more contagious virus through more proactive quarantines in high-risk areas and an accelerated vaccination program. These measures are crucial to ensure that the economic gains of recent months are resumed once we have tackled this current threat, ”said Neda. INQ
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