By Naomi Tiburcio
The National Economic and Development Authority (NEDA), the country’s social and economic development planning and policy coordinating body, stated that a step towards economic recovery involves a stronger testing capacity and vaccination rollout.
“The Inter-Agency Task on the Management of Emerging Infectious Diseases Force (IATF-EID) has taken a careful and calibrated approach by focusing on localized quarantines and addressing the sources of highest risk, so that the jobs and livelihood of the far majority will not be affected,” Acting Socioeconomic Planning Secretary Karl Kendrick T. Chua said.
The IATF earlier recommended to the President the retention of the general community quarantine status (GCQ) of Metro Manila and bring back Bulacan, Cavite, Laguna, and Rizal to GCQ status restricting non-essential travel and enforcing more strict health protocols.
Sabi ng lokal na pamahalaan, mahalagang maging protektado sila dahil sila ang nagiikot sa mga pamilihan upang inspeksyunin ang mga karne at iba pa. (Photo Courtesy of QC LGU)
The NEDA affirmed that this decision will help the economy by retaining the livelihood of Filipinos as compared to possible job losses if the National Capital Region (NCR) is returned to MECQ.
PH economy in worrisome state
Moody’s Analytics earlier released a report following Bangko Sentral ng Pilipinas’ decision to retain the 2% policy rate in March.
“The Philippine economy is in a worrisome state. Elevated inflation, a large output gap, a recent resurgence of COVID-19 infections, and limited vaccine availability are all reasons for concern,” the report read.
Moody’s Analytics pointed out that these challenges explain why the Central Bank kept monetary settings accommodative in March with a record-low policy rate of 2%. The credit rating company is expecting monetary settings to remain in 2021 as the economy slowly recovers.
Echoing NEDA’s statement, Rep. Joey Salceda citing the factors at play, explained that food inflation was due to issues of pork supply because of the African swine flu (ASF) while the output gap resulted from mobility restrictions both of which the country has limited control over.
“COVID-19 vaccination has to be more ambitious. It will help us solve all of these other problems. We can better respond to pork supply issues, improve our output, and reduce further infections if we can jab the shots to more arms faster. Many governments have made vaccination their singular focus for 2021,” Rep. Salceda underscored.
As the country is still in crisis, Rep. Salceda confirmed things are naturally worrisome but the House Ways and Means Committee is “already working with the Department of Agriculture to make import procedures safer to prevent any further ASF contamination” and is “formulating a draft policy to link pork tariffs with public investments in biosafety and livestock insurance.”
GDP Projections
Meanwhile, Moody’s growth estimate for 2021 is also lower than the Development Budget Coordinating Committee’s (DBCC) 6.5% to 7.5% forecast range.
“Our forecast for GDP to grow by 6.3% in 2021, after the 9.3% contraction in 2020, has significant downside risk at this stage. We will review this figure in our early-April forecast round,” the report predicted.
The World Bank also downgraded its GDP projections for the Philippine economy by 5.5% from 5.9%.
NEDA Acting Secretary Chua clarified it is too early in the year for DBCC to make forecast changes but will always look at their data to guide projections.
Aside from vaccination, the government is also focused on delivering aid to Filipinos.
“To help Filipinos cope with the impact of the pandemic and the community quarantines, the 2021 budget has 284 billion pesos worth of subsidies and assistance. We need to ensure that the implementation of these programs are accelerated,” Chua urged.