COVID-19’s impact on the economy: P700 billion to P1.1 trillion
MANILA – Acting Socioeconomic Planning Secretary Karl Kendric Chua said COVID-19 resulted in estimated loss of at least P700 billion by businesses during the lockdown.
Speaking before the Foreign Correspondents Association of the Philippines in a virtual press briefing, Thursday afternoon, the latest appointee to the President Rodrigo Duterte’s official family said the economy will have zero growth rate or slight negative economic growth with about P1.1 trillion losses in the existing 18.7 trillion GDP.
He sounded optimistic on an economic rebound during the years’ third and fourth quarters due to the easing of enhanced community quarantine or lockdown beginning May 1 and the reopening of the economy by mid-year.
He said the economy was doing well until Taal Volcano erupted in January and the suspension of trade and tourist arrivals from China in February and the government’s resolve to stem the spread of COVID-19 by declaring Enhanced Community Quarantine or lockdown in Luzon. Local government units in other parts of the country declared their own version of enhanced community quarantine.
Against a backdrop of thousands of overseas Filipinos returning from different parts of the globe, Acting Secretary Chua expressed belief the suspension or termination of overseas work would be temporary.
“Our workers are in a diverse field. Some of them are in health care and have continuously sent remittance,” he said. However, he said there used to be 20-30% growth in remittances but in recent years the increase was minimal if not flat.
He added when things return to normal, Filipino workers will still be in demand here and abroad.
“Our workers are most admired abroad. However, though workers want to work and their employers want them to work, we have to take our workers welfare and the government support is extended to them,” he explained.
With Tourism sector hit seriously by COVID-19, Secretary Chua said the government is utilizing the untouched P14 fund at TIEZA to directly support this sector and its workers severely affected by the downturn since January.
Asked if the government would still be in a position to settle its obligations with the recent loans, he said the government is capable. He said in 2019, the debt to GDP ratio was 41.5% and this year, it may rise to 46 to 47% of GDP which he went to describe as “very low and manageable.”
From a high of 80% debt to GDP ratio in 2004, he said the country has achieved solid fiscal responsibility and managed the economy well with solid debt management. (Melo M. Acuña)
Acting Socioeconomic Planning Secretary Karl Kendric Chua. (Photo courtesy of Bullit Marquez)