The Philippines is starting to see a “U-turn” in the trajectory of economic activity and manufacturing production, the country’s acting socioeconomic planning secretary said.
The National Economic and Development Authority (NEDA) said in a statement yesterday the government is continuously working on programs that will help severely affected sectors to cope with the impacts of the coronavirus disease 2019 (COVID-19) pandemic.
“While we are not yet in the positive territory, we are hoping that we can continue to manage this recovery as best as we can,” Karl Kendrick Chua, NEDA chief, said in his presentation during a webinar hosted by Globe MyBusiness Academy on August 21.
Chua said the government’s recovery program is comprised of three big areas: the Bayanihan to Recover as One Act (Bayanihan 2), the Build Build Build program, and the 2021 budget.
Two key provisions in the Bayanihan to Recover as One bill adopted by the bicameral conference committee are in fact seen giving the much-needed relief to the sector hardest hit by the pandemic, small businesses and ordinary consumers.
Under Pillars 1 and 2 of the government’s phased and adaptive recovery approach, P655 billion have been allocated to help people cope with the pandemic and improve the country’s healthcare system. This includes the ramped up spending to protect some 18 million low-income households and 3.1 million workers of small businesses.
“Moving forward, we are optimistic that the Bayanihan 2 will help the country bounce back from the crisis with its improved provisions on the healthcare system, public transport, and restoring consumer demand,” Chua said.
He added the government will also provide equity support to distressed firms that are deemed strategic and allow banks to dispose of bad loans and assets so they can serve more businesses.
In addition, Chua said government is focusing on enhancing the productivity of the agriculture sector, as it also plays a crucial role in the country’s economic recovery.
“There’s no way for the Philippines to complete its structural transformation if we don’t make the agriculture sector productive. We have already taken huge steps through the Rice Tariffication Law and the Rice Competitiveness Enhancement Fund,” Chua said.
“We can also do more through our infrastructure and logistics programs,” he added.
Meanwhile, the Department of Tourism (DOT) said the allocation of P10 billion for the tourism industry ensures the survival of micro, small and medium enterprises (MSMEs) since 99.9 percent of the 144,640 establishments in accommodation and food service activities are considered micro, small and medium.
Citing data from the Philippine Statistics Authority, 95.8 percent of the 921,292 workers in accommodation and food service activities are also MSMEs.
A large portion of the assistance under the Bayanihan 2 Bill for the tourism industry, P6 billion will be coordinated by the DOT with the Small Business Guarantee and Finance Corp. of the Department of Trade and Industry , which through its COVID-19 Assistance to Restart Enterprises program, shall provide soft loans to tourism MSMEs subject to guidelines from the DOT.
Bayanihan 2, which provides for a two-month moratorium for the payment of all existing, current and outstanding loans falling due on December 31.
The Management Association of the the Philippines (BSP) said the Bangko Sentral ng Pilipinas’ proposal to put a cap on credit card interest rates coupled with the 60-day payment deferment under the Bayanihan to Recover as One Act, will provide big relief to businesses and individuals using credit cards, many of whom have found themselves jobless as a result of the pandemic.
“We understand that the Bankers Association of the Philippines (BAP) is supportive of the proposal and that is a clear indication how the banking industry is bending over backwards to help our countrymen during this critical period,” said MAP president Francis Lim. (with Irma Isip)