The business community welcomed the Senate ratification of the Bayanihan Recovery to Heal As One (Bayanihan 2) saying that even if the P165 billion economic stimulus package is a bit modest this should help ease the economic difficulties of domestic establishments when properly and efficiently implemented.
The Philippine Chamber of Commerce and Industry (PCCI), the voice of business, said the P10 billion capital infusion to SB Corp and P5 billion to Philippine Guarantee Corp. would benefit the micro small and medium enterprises (MSMES).
However, PCCI President Amb. Benedicto Yujuico said these amounts are significantly lower than what they had advocated under House Bill 6815, otherwise known as the Accelerated Recovery and Investments Stimulus for the Economy or ARISE.
“Our micro and small enterprise members requirements range from P200,000 to P1 million, while the larger enterprises have said they would need a minimum P1 million low-interest loans,” Yujuico said.
As such, Yujuico urged that a bigger part of the P25.5 billion standby fund under Bayanihan 2 should be allocated to the two financing agencies Land Bank of the Philippines and Development Bank of the Philippines.
Yujuico also said that it would be helpful if Landbank and DBP will also relax the terms for MSMEs to be able to avail of the P18.4 billion (Landbank) and P6 billion (DBP) low-interest loans allocated to them that are intended for workers and businesses affected by the pandemic.
For the agriculture sector, Yujuico said, “We are thankful the assistance of P24 billion to the agriculture sector and we are confident, under Sec. William Dar with whom PCCI is closely working with, that this will go to intended beneficiaries.”
For its part, the Management Association of the Philippines (MAP) commended Congress for enacting the Bayanihan 2.
“We are happy that health is the focus, which is key to opening the economy. Big funding is set aside for credit and we urge the government to ensure that it can be accessed easily especially by small businesses,” said MAP President Francis Lim.
MAP also cited the removal of the bureaucratic red tape on the construction of the telco towers and the ball is now in the courts of the telcos to show drastic improvement of their services.
MAP added that the abolition of the tax on initial public offerings is a welcome development. “It will incentivize companies ready to offer their shares to the public to access the stock market for funding at this crucial time,” said Lim.
But since the funds appropriated are extremely limited, MAP urged that disbursement be based on objective criteria such as the sector’s contribution to the GDP, employment share, value added contraction, and their multiplier effect on the economy.
“We also call all those concerned to use the funds for the best interest of the country and welfare of our countrymen as they are duty-bound to do,” Lim added.
The Employers Confederation of the Philippines also thanked the Senate for the relief to sectors such as health, transportation, tourism and agriculture in Bayanihan.
ECOP President Sergio Ortiz-Luis Jr., however, noted the many MSMEs that were left out, particularly in the manufacturing sector. “The signal we got is that they are being given loans through GFIs when what they really need are direct subsidies to pay wages, rents, raw materials and other unpaid loans and interests. Many of these are part of supply chains but have remained closed or partially closed to this day. Are we saying we are allowing them to die?”
Ortiz-Luis said that, “Unless the loans are interest and collateral free, these firms may not be attracted to borrow because of the uncertainty. Government will really have to roll out a development fund for them.”
“This is already something. This will help businesses big and small,” said Francis Chua, founder and chairman of International Chamber of Commerce of the Philippines.
In particular, Chua cited the additional fund allocation to SB Corp. stressing the micro and small enterprises largely depend on government financing to get back on their feet.
Chua, likewise, cited the continued social amelioration program under Bayanihan 2.
Jose Luis Yulo Jr., president of the Chamber of Commerce of the Philippine Islands said the approved
bicameral version is an improvement over Bayanihan 1 since it covers vital areas of the economy such as tourism related, transport, agriculture, education, displaced workers, GFIs capital infusion, and more encompassing assistance related to conquering Covid19 and for health workers.
Yulo, however, expressed concern on how efficiently this law may be implemented. “I am worried however on the efficiency, honesty and integrity of the implementation process, where corruption would be prevalent. I hope the law has something on this.”
Meantime, the Confederation of Philippine Manufacturers of PPE (CPMP) lauded the provision in the Bayanihan 2 mandating government agencies to prioritize locally manufactured personal protective equipment in their procurement over imports.
With the provision mandating for local procurement under the law, the newly formed PCMP expects to provide government hospitals with their medical-grade PPEs, face masks, and coveralls.
Jojo Clemente III, president of the Tourism Congress of the Philippines, expressed gratitude that the Senate approved the P10 billion loan facility for the tourism sector. “It will definitely help the 5.7 million tourism workers get back to work as this fund through low-interest rate loans will at least bridge their immediate needs because we have been out of business for 5 months already. We hope we will be able to get back on our feet soon.”
American investors in the country said that business will benefit from increased funding for public health efforts to defeat COVID-19 and for GFIs and tourism.
John Forbes, senior adviser of the American Chamber of Commerce of the Philippines said, “Measures to reduce red tape to speed up the start of major public and private sector projects and common telco towers and the protection of appropriated infrastructure funds will support economic recovery. Mergers and acquisitions below $1 billion will proceed faster. But the GUIDE and FIST bills are needed to help many companies to survive an extended depression when consumer spending is very low.”
Other favorable features of the bill for the business sector include the 60-day extension for loan payment.
Furthermore, Bayanihan 2 directs public utilities to implement a minimum 30-day grace period for the payment of fees falling due within the enhanced community quarantine (ECQ) or modified ECQ without penalties.
To further ease business in the country, the Bayanihan 2 also eased the permit requirement for all infrastructure projects approved by the National Economic Development Authority. Securing of permits was also eased for telecommunication companies in constructing new cellular sites.
Following the Senate approval Thursday evening, the House is expected to ratify the approved bicameral version Bayanihan on Monday next week.
Upon Congress’ ratification, the proposed measure will then be transmitted to President Rodrigo Duterte for final approval.