THE GOVERNMENT should abandon its growth targets and focus resources on mitigating the impact of COVID-19 (coronavirus disease 2019) via emergency financial and non-financial aid for affected households and businesses, according to an Ateneo de Manila University think tank.
The Ateneo Center for Economic Research and Development (ACERD) as well as the university’s Economics Department said that government efforts should be funneled into ensuring the supply of critical medical equipment while addressing the economic and social costs of the enhanced community quarantine (ECQ) imposed on Luzon.
“[The] government should set aside its growth targets (firms, in turn, should also let go of their profit targets this year),” they said in a statement.
The government was initially targeting gross domestic product (GDP) growth of 6.5-7.5% this year after a below-target performance of 5.9% in 2019.
With the virus spreading and Luzon locked down, officials are already releasing scaled-back growth estimates this year.
Bangko Sentral ng Pilipinas (BSP) Governor Benjamin E. Diokno said that central bank estimates point to growth of 5-5.5% this year, which he described as not bad and still among the fastest in the region in the context of the imminent global recession expected by analysts.
Socioeconomic Planning Secretary Ernesto M. Pernia has also released preliminary estimates from the National Economic and Development Authority of 4.3% GDP growth for 2020.
The Ateneo economists recommend that the government instead focus its energy on supporting the health care sector as frontliners struggle to contain the virus by ensuring the availability of testing apparatus and personal protective equipment (PPE).
They recommended “appropriating P50 million for each DoH (Department of Health) hospital (about 69 based on DoH website) or about P3.5 billion for PPEs and equipment as well as medicines,” it said.
They likewise noted that the government could increase funding for the Universal Health Care program to ensure that the marginalized do not endure crushing medical expenses during the pandemic.
They also recommended that the government expand disbursements of unconditional cash transfers, currently budgeted at P36.5 billion. They said cash transfers should also be given to those not registered with the Pantawid Pamilyang Pilipino Program.
Another proposal was a P70-billion program for food rations for the poorest families.
They said the government should set aside P10 billion “to hire logistics and movers, particularly motorcycle riders, taxis and transport network vehicle services to move food, medicines and frontline medical staff.”
The economists also recommended a postponement of the income tax deadline to the end of July, waiving all penalties.
Other recommendations were debt relief for small and medium-sized enterprises, extended payment for bank loans, mortgages and consumer loans, and tax credits for firms that continue to pay staff despite suspended business operations.
Last week, the government announced a P27.1-billion stimulus package in response to the pandemic, with P14 billion allotted to support the tourism industry and P3.1 billion for the expedited acquisition of critical medical supplies.
A P108-billion stimulus package bill has also been filed in the House of Representatives.
If passed, House Bill 6606 filed by Representative Stella Luz A. Quimbo of Marikina will allocate P43 billion for the tourism sector, P15 billion for displaced workers, and P50 billion for assistance to businesses. — Luz Wendy T. Noble