The four months of lockdown that began on March 16 are expected to contract the Philippine economy by 8 percent this year, making it one of the slowest to recover in Asia, according to an assessment by London think tank Capital Economics.
The Philippine economy is deemed to have entered a technical recession in the second quarter of this year, after a 0.2 percent decline in output in the first quarter. This was well below the government’s expectation of 2 to 3.4 percent.
The continuing lockdown and inadequate fiscal support will delay recovery in the Philippines, the London think tank said. In contrast, China, Vietnam, and Taiwan will have the fastest recovery in the region, with their success in confining the spread of the coronavirus.
Our own Philippine economic officials led by Finance Secretary Carlos Dominguez III had been hoping for an easing of the restrictions in Metro Manila and Calabarzon (Cavite, Laguna, Batangas, Rizal, Quezon), which account for some 70 percent of the country’s Gross Domestic Product (GDP).
If the General Community Quarantine (GCQ) in Metro Manila and Calabarzon had been eased into a Modified GCQ (MGCQ), as many had hoped last July 15, economic activity would considerably pick up. But the national government decided instead to keep the region in GCQ. Secretary Dominguez bowed to the decision recommended by the government’s health experts.
Several other areas in the country have already been upgraded into Modified General Community Quarantine (MGCQ), the final step before a final “new normal” with minimum restrictions. Among these are Laguna, Cavite, and Rizal, just south of Metro Manila. This is tribute to their success in keeping coronavirus cases down in their areas.
Metro Manila has to remain in its present GCQ. A great deal will depend on the ability of its 16 local government units to keep down infections and deaths in their respective areas with the help of the police.
They have another 15 days to prove themselves. We hope they will be able to keep down new coronavirus cases in these 15 days, so that the restrictions will be further lifted and economic activity will begin to go back to normal.
The resumption of business and industry will raise the economy from the depths of recession into which it has fallen. More important to most people, it will help bring back life as they once knew it – in their homes with their families, in their schools and public markets, their streets and parks, and in their churches.