NEDA sees P9.4-B in weekly gains from Alert Level 1

By Chino S. Leyco

The economy is estimated to gain an additional P9.4 billion per week as the country continues to move towards the new normal, the National Economic and Development Authority (NEDA) reported.

During President Duterte’s Talk to the People late Monday, Feb. 28, Socioeconomic Planning Secretary Karl Kendrick T. Chua said the shift to Alert Level 1 in more parts of the country will generate an estimated P9.4 billion a week of economic activity in gross value-added terms.

“Alert Level 1 will benefit 62 percent of the economy and 20.3 million workers, comprising 48 percent of our workforce. By shifting to alert level 1, we estimate 170,000 less unemployed workers over the next quarter,” Chua said.

He added that the benefits would increase to P16.5 billion of economic activity in gross value-added terms and translate to P5.2 billion more in salaries per week if the whole country shifts to alert level 1.

This would also result in 297,000 less unemployed workers over the next quarter, Chua estimated.

If not for the pandemic, Chua also said the size of the Philippine economy would have reached P25.3 trillion this year. With the shift to alert level 1, the economy is expected to recover to pre-pandemic level faster.

“We bounced back in 2021 with a 5.6 percent growth. We now have to recover the losses we experienced in the last two years amounting to P3.8 trillion. The shift to alert level 1 will help close this gap faster,” Chua said.

According to Chua, the shift to alert level 1 will further improve the performance of key sectors like tourism.

“The contribution of domestic tourism to the economy fell by P1.5 trillion or 7.4 percent of the GDP in 2020. We can recover at least half of that or P750 billion by shifting to alert level 1,” he said.

Chua also reiterated the need to reopen all schools for face-to-face learning as this will provide a big boost to the economy and improve learning and productivity.

NEDA estimates that resuming face-to-face learning will increase economic activity by around P12 billion per week due to the return of services around schools such as transport, dormitories, food stalls, and school supplies stores, among others.

This will also avert around P11 trillion in productivity losses and improve learning outcomes by around 50 percent, NEDA said.

However, Chua emphasized that alert level 1 is not fully implementable if working parents need to stay home to help their children study.

Resuming face-to-face learning is expected to free up the time of one-fourth of parents who skip work or reduce work time to accompany their children in home learning.

“Even if we shift to alert level 1, if schools remain closed, one-fourth of parents will not be able to work full time because they are watching over their children during classes,” Chua said.

To close, Chua also discussed the Economic Development Cluster’s proposed 10-point policy to accelerate and sustain economic recovery in 2022 and beyond.

This covers: metrics; vaccination; healthcare capacity; economy and mobility; schooling: fully open face-to-face; domestic travel; international travel; digital transformation; pandemic flexibility bill; and medium-term preparation for pandemic resilience.

According to him, this agenda will help restore jobs and bring more people out of poverty.