By CHINO S. LEYCO
President Rodrigo R. Duterte’s economic cluster has recommended the augmentation of the Department of Health’s (DOH) budget amid the coronavirus disease (COVID-19) outbreak.
Finance Secretary Carlos G. Dominguez III said that the economic development cluster (EDC) has recommended an additional P2.92 billion funding for the DOH’s COVID-19 responses.
“This will be used for additional testing, augmentation of contact tracing, and surveillance, and additional personnel protective equipment for health workers at the national and local levels,” Dominguez said following the EDC meeting.
“It will also fund isolation packages for patients who will be admitted for COVID-19, and this will be covered by PhilHealth [Philippine Health Insurance Corp.],” he added.
Asked where the government will source the additional funding for the DOH, Dominguez said it be generated through borrowings.
For this reason, the finance chief said the national government’s budget deficit may rise beyond the Duterte administration’s ceiling this year of 3.2 percent of the economy, as measured by its gross domestic product (GDP).
The Department of Finance (DOF) estimated that the fiscal deficit may hit 3.6 percent of the GDP in 2020 should the economic disruptions caused by COVID-19 last until the second-semester of the year.
“The corresponding increase in the borrowing level will provide financing for the increased deficit,” Dominguez said.
“Our credit rating is quite robust and we don’t expect any difficulty in covering a potential deficit that might occur because of the expected drop in economic activity because of this COVID,” he added.
Meanwhile, Socioeconomic Planning Secretary Ernesto M. Pernia said the economic impact of the COVID-19 if the outbreak is not resolved by June will be around 0.5 percent to 1.0 percent of GDP.
Data from the Department of Labor and Employment (DOLE) showed that there are already 66 establishments covering 4,735 workers have reported flexible work arrangements and temporary closure.
Of that total, 47 establishments have adopted flexible work arrangements, covering 4,416 workers, and the remaining 19 establishments resorted to temporary closure covering a little over 300 workers.
These establishments are mostly in tourism related sectors—hotels and restaurants—and a number are manufacturing companies, coming from Regions III, VI, VII, and XII.
Likewise, Trade Secretary Ramon M. Lopez said they “saw how Chinese business activity weakened especially in February, [but] in March we saw gradual normalizing of activities in China.”
Dominguez, however, assured that despite the challenging economic environment this year, the government is not contemplating a reduction in its expenditures.
“Our Build Build Build (Program) will go full blast, and so will all other programs of the government that are designed to improve people’s health, improved education level of our people and make sure the economy is humming along as it should,” he added.