Trade and Industry Secretary Ramon M. Lopez has vowed of government policies that strengthen prioritization of local procurement over imports to boost domestic demand and rebuild jobs amid high unemployment in the country following several company closures due to the pandemic.
Lopez made this assurance to the business sector after Amb. Benedicto V. Yuyuico, president of the Philippine Chamber of Commerce and Industry who represented the private sector, highlighted in their recommendations “Business Sector Agenda Towards Employment Recovery” the need to prioritize local procurement during the National Employment Recovery Strategy (NERS) Summit for the Business Sector.
Lopez pointed out that the last letter in DTI’s REBUILD campaign stands for domestic demand. “We believe local procurement or government procurement from local manufacturers or locally produced products would really bring in a strong demand for the local economy to revive,” he said.
The trade chief, who has been implementing measures to curb importation and promote local entrepreneurship to protect domestic industries and jobs, said local procurement policy even for a five-year period only would be of great help already in the recovery of domestic businesses.
“To have this kind of preference for locally produced materials that will be bought by government will be a big help for our recovery,” he added.
NERS, which has a government budget of P1.14 trillion, seeks to restart economic activities, restore business and consumer confidence, upgrade and retool workforce, and facilitate labor market access.
In his presentation, Yujuico stressed that to restart the economy, the government should implement more infrastructure projects and more procurement bids sourcing from local firms. Increased public spending must also ensure timely payments to bidders and immediate settlement of past payables. A large portion or more than P1.1 trillion of the P1.14 trillion NERS 2021-2022 budget have been allocated for the government’s infrastructure projects.
The business sector also urged government to intensify marketing assistance and promotional campaigns of Filipino goods and services through buy local campaigns and leveraging of foreign market demands and export potentials.
He said the private sector is facing market confidence issues such as uncertainty, risk, and wait-and-see attitudes that slowed down economic activities, particularly investments and consumption, which then resulted to lower sales and cash liquidity constraints for businesses, exerting downward pressure on their productivity and operational capacity.
The various community quarantine restrictions, he said, have caused delays in logistics, disrupted supply chain management, restricted the movement of people, goods, and services, added costs in doing business for health and safety measures, and limited business operations and planning, further compounded by unclear government communications, sporadic changes in policy guidelines, and inconsistent implementation of regulations and mobility controls.
To help businesses recover faster, Yujuico said that government should waive renewal of existing permits and licenses, transaction fees, and moratorium on the expiry of existing permits and licenses especially for micro, small and medium enterprises.
To strengthen support for MSMEs and cooperatives, the PCCI has pushed for capacity-building in procurement participation, improving access to financial services and solutions, as well as facilitating acquisition of machinery/equipment. Establishing partnerships, consolidation, linkages, clustering, and cluster hubs are also encouraged.
The government must also improve ease of doing business (EODB) and business environment by rationalizing and streamlining government processes, requirements, and fees, as well as adopting e-governance/digitalization. Tax collection process in the local government units (LGUs) must be streamlined, and procurement processes and requirements must be eased. Yujuico also called on government to stabilize and address the rising costs in logistics and raw materials.
Yujuico also urged to institutionalize business resiliency plans for service continuity and provide capacity-building and resources/tools and assistance to shifting to digitalization.
In addition, Yujuico urged government to improve healthcare capacity and support systems in the Philippines, especially absorptive capacity for patient. There must be support mechanisms and welfare for COVID-19 positive workers, whether in-patient or asymptomatic undergoing isolation and quarantine.
For the longer term, the business sector would like to review and update of education and training curricula, particularly content and equipment being used, to match current industry needs, practices, and requirements.
The business sector has also called for the improvement of the government’s vaccine rollout through faster and more efficient implementation, with simultaneous rollout of effective promotion and proper education on vaccines.
The must also recognize industry workers as “essential”/economic frontliners with priority in the vaccination and with exemptions or eased requirements in mobility restrictions.
Businessmen also see the need for improved community quarantine restrictions by ensuring that government planning and communications are deliberate, flexible, responsive, clear and consistent, without sporadic changes. Implementation should also be consistent with official policies and guidelines. Further, mobility restrictions must be harmonized and eased.
On the part of the businessmen, Yujuico said the private sector assures of cooperation to achieve our national goal of recovery from the COVID-19 pandemic through inclusive and sustainable economic growth that is based on the principles of social justice, full employment, and decent work.
“As our country continues to battle the effects of the COVID-19 pandemic and transition into a New Normal, we foresee continuing challenges with the fast-evolving work patterns and environment, and other disruptions that may hinder the attainment of decent work and affect employment and livelihood of individuals,” he said.