THE Philippine Exporters Confederation Inc. (Philexport) has submitted to the Inter-Agency Task Force for the Management of Emerging Infectious Diseases a list of financial measures that will minimize the impact of the new coronavirus disease 2019 (COVID-19 pandemic on its members, particularly micro, small and medium enterprises (MSMEs) which make up 65 percent of the country’s employment.
“Orders had either been canceled or suspended and employees have left for the provinces and not keen on coming back soon. In the meantime, employers’ bills are piling up: rents, raw material expenses, salaries and wages, utilities. It will not be surprising to find most of them starting from scratch when they operate again,” said Philexport Sergio Ortiz-Luis in his letter dated April 6, 2020.
Philexport in the letter called on the Department of Trade and Industry to implement an extension of the moratorium on utility and rental payments for at least 90 days , from the current extension of 30 days, with expanded payment period at no interest and for it to mandate the waiver of commercial rents, instead of just providing a 30-day grace period for at least two months following the lifting of the enhanced community quarantine (ECQ) for enterprises that stopped operations and for one month for those with partial/reduced operations.
The group is also seeking for the waiver of income tax payments from the ECQ period until two more months after it is fully lifted.
Philexport said this would free up cash which enterprise may then use to pay salaries/ wages and raw materials.
The group is also seeking the waiver of penalties and charges for late income tax filings and returned checks.
To ensure business continuity, the DTI and the Bangko Sentral ng Pilipinas should facilitate appropriate MSME-friendly COVID-19 policies on special credit windows as well as loan repayment holidays, longer than the current 30 days; and loan restructuring without penalties.
Philexport also urged the Department of Finance to implement the waiver payment of excise taxes and other fees associated with their operations for the duration of the pandemic; and provide an option for total bailout with a national government equity stake.
Ortiz-Luis said to fund these measures, government may consider realigning budget from the conditional cash transfer as well as from the national and local government funds.
“These are bitter pills to swallow if we are to help ensure that MSMEs get back on their feet, become profitable enough again to re-hire or increase workers and expand operations,” Ortiz-Luis said.
