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Philippines prepares for prolonged pandemic

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MANILA (Philippine Daily Inquirer) — Much as the Philippines would like to knock out Covid-19, which has brought the economy to a recession, the country’s chief economic manager urged prudence in public spending in case of a protracted pandemic.

“When Sen. Manny Pacquiao trains for a fight, he prepares for 12 grueling rounds,” Finance Secretary Carlos Dominguez III said in a statement.

“As there can be no knock-out punch that cuts our fight short before a vaccine is developed, the government’s ability to sustain the fight depends on our fiscal stamina. We have the resources necessary to endure this challenge, but we must also conserve our resources for succeeding rounds of this fight,” he added.

The Department of Health’s data suggests there are several rounds more to go as it tallied 4,226 new Covid-19 cases on Saturday, bringing the total count to 126,885.

The death toll also increased to 2,209 as 41 more patients succumbed to the severe respiratory disease.

More than half, or 2,669, of the new infections still came from Metro Manila. Laguna was a far second with 285 cases, followed by Cavite (154), Cebu (125) and Rizal (118).

The number of active cases climbed to 57,559, of which 91.4% are mild, 7.3% are asymptomatic, 0.7 percent are severe and 0.6% are critical.

Dominguez said the 140 billion to 165 billion pesos ($2.8 billion to $3.36 billion) stimulus package under the envisioned Bayanihan (Community Spirit) to Recover as One Law, the record 4.5 trillion pesos ($91.6 billion) national budget for 2021 and the Duterte administration’s sustained investments in infrastructure were designed to hasten recovery.

While critics complained that the stimulus package was too small to recover the billions of dollars in economic losses and the millions of jobs lost, Dominguez said the stimulus package included “targeted support for unemployed individuals and the hardest-hit strategic industries.”

Moreover, the package will also be complemented by the passage of the pending Corporate Recovery and Tax Incentives for Enterprises or Create bill, which will slash corporate income tax from 30% — the highest in Southeast Asia — to 25%, retroactively effective to July.

Foregone revenues from the lower tax rates under Create had been estimated to reach over $885 million this year — tax savings which Dominguez hopes would be reinvested by firms to revive their operations.

“The economy is in good shape to mount a strong recovery soon enough, given the positive metrics—such as benign inflation, a peso that is the strongest currency in Asia and high-investment grade credit profile that has enabled us to borrow money here and abroad at relatively lower cost,” he added.

Also on Saturday, acting Socioeconomic Planning Secretary Karl Kendrick Chua said the state planning agency National Economic and Development Authority, which he heads, was spearheading the task force on Covid-19 recovery via the “Recharge Philippines” program.

Chua said “the government will focus on rebalancing its priorities from saving lives from just the Covid-19 virus to saving lives from Covid-19 and other factors, such as hunger and other diseases.”

 

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