House Ways and Means Committee chairman and Albay Rep. Joey Sarte Salceda asked the country’s economic managers to invest in infrastructure and human capital development to ensure that the recent contraction in the gross domestic product will not translate into permanently lost income.
The government should first have to make equivalent investments in infrastructure and human capital development either this year or next year, said Salceda who also co-chairs the House Economic Stimulus Response Package Cluster.
The GDP contracted by 16.5 percent in the second quarter amid the onslaught of the Covid-19 pandemic, but Salceda said the country’s economic resilience remains sound and at its best.
“The GDP contraction is a bad number, but this is best understood in perspective. Even with 50 to 70 percent of mobility paralyzed, the Philippine economy can still perform at about 80-percent capacity. If that is not the definition of economic resilience, I don’t know what is. We can build on these strengths. But we, the economic team in Congress, and our counterparts in the Cabinet, will have to keep working hard,” he said.
Salceda said that he is “in talks with the economic managers on this matter” and that he is drafting proposals for economic reconstruction, for government consideration in the coming weeks and months.
As for now, Salceda said Congress should urgently pass economic reforms that will enable more investments to enter the country which have now become even more urgent.
“We have to pass the Corporate Recovery and Tax Incentives for Enterprises Act [CREATE], the amendments to the Foreign Investments Act, Retail Trade Liberalization Act and Public Service Act. We have already given our versions of all of these reforms to the Senate, so we hope for their speedy approval,” he said.
The economist-lawmaker said the Philippines “cannot attract new investments and create new jobs if, as the OECD [Organization for Economic Cooperation and Development] says, we are the most restrictive to investments in Asia,” he said.
Salceda said the government should also focus on agriculture, which grew by 1.6 percent despite the quarantine. “Agriculture is a hedge from economic crises. As food will always be essential, food production will always be a resilient industry. I am a principal author of the amendments to Agri-Agra, which will boost credit to the whole agricultural value chain,” he said.
He reiterated his proposal (under the stimulus program) to condone the agrarian reform beneficiaries’ loans in LandBank “will release 1.228 million hectares of land for more efficient agricultural use, and will benefit 682,000 agrarian reform beneficiaries.”
Salceda said the country should also expand the country’s healthcare capacity while protecting health care workers at all costs to make consumers and businesses confident.
“Our health outcomes correlate with our economic outcomes. We need to get our stuff together on the health front. There is no tradeoff between health and livelihood, but there are ways to protect both: expand our healthcare capacity, protect health care workers at all costs, make contact tracing and testing effective and widespread, and make consumers and business people reasonably confident,” he said.