Philippine economic growth has begun to recover in the first three quarters of 2021, and its sustainability will depend on the people’s collective actions, said the National Economic and Development Authority (NEDA).
During the online forums of The Manila Times and the Economic Journalists Association of the Philippines on October 27 and 28, respectively, Socioeconomic Planning Secretary Karl Kendrick T. Chua highlighted that the country’s better management of risks will allow the Philippine economy to grow by 4 to 5 percent in 2021 and 7 to 9 percent in 2022. He added that this will pave the way for the country to return to the pre-pandemic growth path in the upcoming years.
“Our solid growth prior to the COVID-19 pandemic of over 6 percent, unfortunately, went way down in 2020 as we had to shut down 75 percent of the economy at the peak of the enhanced community quarantine, but we have slowly recovered, and the latest number that we are seeing is a positive 11.8 percent growth in the second quarter,” Chua said.
According to Chua, the country’s various economic indicators point to encouraging prospects of economic recovery. This is evident with the continued improvements in manufacturing production, external trade, public infrastructure spending, and job creation. The government is also proactively monitoring food supply and prices, particularly of pork, to address the elevated inflation rate.
“At present, 77 percent of the economy is still under heightened quarantines. However, the quarantines today cannot be compared with the level of quarantines last year. People have learned to treat the virus as endemic, so I believe that the economy will continue to grow because of the data and the change of paradigm that we are seeing,” he added.
However, Chua also recognized the severe impact of the pandemic and quarantines on present and future generations, citing NEDA’s study that COVID-19 is estimated to cost the economy a total of 41.4 trillion pesos over the next 40 years. Of this amount, 11 trillion pesos represents the reduction in future wages and productivity, as a result of the suspension of face-to-face classes in the school year 2020 to 2021, and the lost wages of parents who forgo or reduce work hours to accompany their children in online classes.
“Our actions today against COVID-19 do not come without consequences. There are also costs to future generations, especially on our human capital. Without understanding these, we would not have a complete and objective understanding of what we are doing today,” he said.
Given this, Chua reiterated the importance of the government’s three-pillar strategy to ensure the country’s strong recovery. This includes: i) accelerating the vaccination roll-out, ii) safely reopening the economy, while strictly adhering to health protocols, and iii) fully implementing the recovery program, especially the 2021 budget.
He also called for the targeted resumption of face-to-face classes to help mitigate the long-term consequences of remote learning on students’ productivity and mental health.
“I would like to rally everyone to use this pandemic to get as much done as soon as possible. My concern is not just for today but for tomorrow and for my son’s generation. The most important thing is we pilot [face-to-face schooling] today so that our learnings can be applied in January 2022. Otherwise, the related productivity loss of 11 trillion pesos will double if we do not open more schools in this school year,” Chua said. (NEDA)-rir