By Genalyn Kabiling
The government should accelerate the "Build, Build, Build" infrastructure program, boost food production, and pass the second tax reform package to revitalize the local economy hurt by the coronavirus pandemic, Finance Secretary Carlos Dominguez III said on Tuesday.
Finance Secretary Carlos Dominguez III
(Facebook / MANILA BULLETIN FILE PHOTO)
Dominguez also proposed the mass hiring of contract tracers, saying 1.2 million people who lost their jobs could be tapped in this effort to track down cases of infection.
"We have to do many things in order to revive the economy," he said during a meeting with President Duterte and other Cabinet members on Monday.
"After we are confident that we are in control of the death rate and infection, we should restart and accelerate the 'Build, Build, Build' Program subject to compliance of minimum health standards," he said in his remarks aired on state television Tuesday.
He said infrastructure development remains as the "best driver of economic growth because it has the best multiplier effects in terms of employment and shared prosperity."
According to Dominguez, the government must also hire contact tracers "en masse" to boost the government's efforts to stop the transmission and defeat COVID-19 while providing jobs.
"We lost about 1.2 --- 1.5 million jobs. They are temporarily lost, but you know, if we hire these guys to do contact tracing, which we are having a very hard time right? I think we can provide good jobs to people," he said.
"Because sometimes it takes one contact tracer one whole day to do contact tracing for one case. So we need to hire enough contact tracers to match the numbers we expect that will come with more testing," he added.
Dominguez also called for the passage of the Corporate Income Tax and Incentives Reform Act (CITIRA) by June to attract investors who want to relocate from other countries and in search of resilient high growth potential economies like the Philippines.
He said the second tax reform package will include flexible tax and non-tax incentive to target specific companies.
"The bill has been with the Senate for a few months. We would like to ask for your support so that Congress can pass this before June 3," he said.
To stimulate consumer demand, Dominguez proposed the promotion of manufacturing of products that have strong and inelastic demand such as food production.
"Inelastic demand means that you will buy it regardless of what your income is or what the price of the good is. And that is food, number one," he said.
"You have to eat food. So we must push food production and food logistics. We must be able to get the food here cheap. We must be able to store the fresh food so it will last," he added.
He said the government must also support the whole value chain for food products, including food markets for efficient distribution similar to the fruit and vegetable markets in Japan.
Dominguez also informed the President that the economic recovery program is being finalized.
He said the economic team is working with legislators to craft the economic recovery program to combat the pandemic. The program also includes assistance to industries, especially micro, small, and medium enterprises as well as workers to help them "get back on their feet."
"So, Mr. President, our real problem is that the people are not buying things. So we must, because their incomes have gone down, provide them the means of buying thing,” he said.
"Because if they don’t buy things, it’s useless to help the companies. So we have to stimulate demand, and that’s through 'Build, Build, Build' and push food production," he added.
The Philippine Statistics Authority (PSA) had earlier announced that the local economy contracted by 0.2 percent in the first quarter of 2020. It is considered the country’s first economic contraction since 1998.
The latest figure compares to the 6.7 percent recorded during the fourth quarter of 2019, and the 5.7 percent during the first quarter last year.