Malacañang on Tuesday expressed optimism that the Philippine economy would recover from the coronavirus disease 2019 (COVID-19) pandemic-induced slump.
This, after the Philippine Statistics Authority (PSA) reported that the country’s gross domestic product (GDP) posted a smaller contraction of 4.2 percent in the first three months of 2021, compared to an 8.3-percent decline in the fourth quarter of 2020 that led to the -9.5 percent growth last year.
While the Palace is saddened by the first-quarter GDP outturn, it is still expecting an economic rebound in the next quarters, Presidential Spokesperson Harry Roque said in an online press briefing.
“We are saddened that our GDP figures remain negative. But we are happy at the same time because from -8, the country’s negative growth is now -4.2. Meaning, we are recovering,” Roque said.
Roque said he is confident that the country will attain a positive economic growth through the government’s “Ingat Buhay para sa Hanapbuhay (Protect Life for Livelihood)” campaign.
“Our economic growth is improving. However, it is still not positive. We’re about to take off so our appeal is to protect life for livelihood,” he said.
Roque said rebounding back to growth territory is achievable, with the cooperation of the public.
“If we protect our life and get vaccinated, we expect that our GDP will become positive in the next quarters,” Roque said.
The economist of the House of Representatives said he was not surprised but was otherwise disappointed by the reduction in year-on-year GDP for the first quarter.
“The quarantines only began on March 15 last year, so quarantine versus no quarantine, the results will be a decline in output, year-on-year,” Albay Rep. Joey Sarte Salceda, chairman of the House Committee on Ways and Means, said.
“I also suspect we are undercounting some of the real economic output, since much of the formal economy has moved into more informal avenues of making a living, such as online selling. There is a certain level of personal resiliency in the Filipino that always comes ahead of our economic conditions,” he added.
Salceda said the government cannot pass on the burden of economic recovery “to the personal resiliency of our people. We need the structural environment necessary to allow people to recover. A quicker vaccine rollout is the most important economic intervention in this regard. The sooner we can vaccinate more people, the better.”
In a separate virtual presser, Socioeconomic Planning Secretary Karl Kendrick Chua said the country still has eight months to catch up and recover despite some losses in the imposition of strict quarantine measures in the country.
Chua said there is a “strong” reason to see a positive economic growth, citing the difference in the implementation of enhanced community quarantine and modified enhanced community quarantine in 2021 compared to last year.
He said growth prospect is underpinned by three important policy actions, including safe reopening of the economy, full implementation of the recovery package, and acceleration of the vaccine program.
Due to the present economic situation, Salceda said that in the meantime, “while the health conditions for a safe reopening are not yet present, we must acknowledge the need for household relief.”
“Protecting household incomes is our strongest bridge to the vaccine. It keeps people alive and incentivizes healthy behavior, such as staying at home and not taking unnecessary risks. This is why some form of additional support through some version of Bayanihan 3 is still necessary.”
“I will continue to watch out for the next quarter’s results. Coming from a depressed base last year, we should get double digit year-on-year gains. Failing to achieve this next quarter should be an unmistakable sign of the need for additional fiscal support,” Salceda said.
Meanwhile, Deputy Minority Leader and Bayan Muna Rep. Carlos Isagani Zarate noted the Philippines is now the worst-performing economy in Southeast Asia with 4.2 percent GDP contraction in the first quarter.”
The country “cannot possibly recover if the Duterte administration will continue with its militarist and lockdown-centered solutions, will continue to reject calls for substantial subsidy, like the P10K ayuda and will continue to ignore demands for economic stimulus that will hasten the recovery of affected enterprises, especially the MSMEs, among others,” he said.
Zarate said a special session of Congress should have been called early on to fast track the passage of measures that will help the people cope with the effects of the pandemic.
“The urgency of government providing assistance, cash especially, to millions of Filipinos is now made more pressing in the wake, too, of the slow-paced vaccination program, which herd immunity target date keeps on moving after being attended by several ‘drop the ball’ controversies and miscues,” he said.