The Philippines should post a seven to eight percent gross domestic product (GDP) growth rate per year in the next administration to recover from the coronavirus disease (COVID-19) pandemic losses, according to economists from the University of the Philippines.
"For the Philippines, the best way to finance future deficits is to restore economic growth to slightly above the pre-pandemic norm--positive seven to eight percent per annum if possible--or higher--to be able to lower the debt stabilizing primary balance to level consistent with financing the required broad-based growth," UP School of Economics (UPSE) Association Professor Dr. Renato Reside during a #PILIpiLUNAS2022 webinar.
Reside said the Philippines also needs an employment-expenditure stimulus of a maximum of two to three percent of GDP per annum for the "next several years."
He noted that if the country will not be able to manage its rising public debt, it may be vulnerable to rising interest rates.
"If your debt is growing, then you're vulnerable to rising interest rates, which might happen in the near future, because the United States might reverse its current easy monetary policy stance," Reside added.
Meanwhile, UPSE Associate Professor Dr. Cielo Magno hopes the next administration could prioritize strengthening institutions and comprehensive social protection programs.
"We hope the next administration will prioritize, one, improving the quality of governance and rule of law in the country, address issues of corruption; second, is to have a comprehensive social protection program, invest in people also; and lastly, having a comprehensive industrial policy in the country," Magno said.
UPSE Assistant Professor Dr. Adrian Mendoza said the next administration should also prioritize science and technology along with innovation to boost the manufacturing, agriculture, and services.
"What we are really advocating is a more balanced growth of the Philippine economy, a stronger manufacturing sector that is supported by a vibrant and modern agricultural sector, and at the same time, tinatahi naman sila ng isang napaka (it is being supported by) high-skilled services sector," Mendoza added.