That was deep, dizzying, disabling plunge.
The economy sustained multiple injuries and is being wheeled into the trauma ward for immediate and comprehensive treatment.
It is gasping in the ER and a more robust stimulus package is the ventilator it needs.
How deep was the fall big was the damage?
“We lost P1.4 trillion during the first half -- about P10.8 billion daily from April to June alone,” said Senate President pro Tempore Ralph G. Recto, sizing up the total tab.
In order to stave off an economy flatlining even before the country shakes off the pesky 2019 coronavirus disease pandemic, Recto said a “comprehensive health response”, especially testing, which in turn would rebuild confidence, is “the main ingredient of the cocktail of cures”.
“For example, fear of catching the virus is one reason for dampened consumption, which is 3/5th of the economic pie. We must flatten the curve to revive the flatlining economy,” he said.
He stressed: “We have to keep people and commerce moving safely. Lockdown should not totally ground all public transportation. Not everything on the economy travels along the information highway. Many, like food--the sector which posted growth--move on four wheels.”
The veteran lawmaker noted that transportation is key because not everyone can work from home. But land transportation still shrank by 66 percent.
“The evaporation of safe commuting options contributed to the surge of the official unemployment rate to 17.7 percent, which, in turn, plunged onsumption,” he said.
The former Socio-economic Planning chief said the economic team, which is an autonomous unit in the administration and is on autopilot, largely insulated from presidential intervention, should present during budget hearings “a second half battle plan
The chairman of the House Ways and Means Committee echoed Rectos call as he stressed the need to pass economic reforms to enable more investments to enter the country after plunging into pandemic-induced recession in the first half of the year.
Albay Rep. Joey Salceda, panel chairman, said Congress should prioritize the passage of the Corporate Recovery and Tax Incentives for Enterprises bill, which is one of the legislative priorities identified by President Duterte in his fifth State-of-the-Nation Address.
The proposal seeks to reduce the corporate income taxes to 25 percent from the current 30 percent.
Salceda also called for the immediate approval of the proposed Retail Trade Liberalization Act, Public Service Act, and the amendments to the Foreign Investments Act.
“We have already given our versions of all of these reforms to the Senate, so we hope for their speedy approval. We cannot attract new jobs and new investments if, as the OECD (Organization for Economic Cooperation and Development) says, we are the most restrictive to investments in Asia,” he said.
The government reported a 16.5-percent economic contraction in the second quarter, deeper than the revised -0.7 percent in the previous three months and the lowest since 1981.
The Albay lawmaker noted that investments in infrastructure and human capital development must be made either this year or next year to ensure that the bite out of the economy would not translate into permanently lost income.
He also highlighted the need to make “wise” investments in agriculture, which grew by 1.6 percent despite the quarantine measures in place.
“Agriculture is a hedge from economic crises. As food will always be an essential good, food production will always be resilient industry,” he said.
He said amendments to the Agri-Agra Reform Act of 2009 are necessary to provide farmers, fisherfolk, and rural communities greater access to credit, as well as the proposal for condonation of the agrarian reform beneficiaries’ loans in Landbank.
“This will release 1.228 million hectares of land for more efficient agricultural use, and will benefit 682,000 ARBs,” he said.
The Bicolano congressional leader said the country’s healthcare system should be strengthened as the health outcomes correlate with economic outcomes.
“There is no trade-off 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 businesspeople reasonably confident,” he said.
The government reported the country’s gross domestic product declined by nine percent in the first semester, as household consumption and private sector investment significantly dropped given the closure of businesses and the loss of income during the enhanced community quarantine.