Trade Secretary Ramon Lopez said that it is only through the resumption of business activities that the country’s economy will be able to recover after plunging 16.5 percent in the second quarter of the year.
But with the risk posed by the coronavirus disease (COVID-19), Lopez underscored that strict health protocols should remain in place while easing lockdowns and gradually reopening economic activities.
“We recognized the primacy of health over economy.”
“We recognized the primacy of health over economy, as the country tried to build up more testing capacities and health and treatment facilities,” the trade chief said.
The trade head added that the government also recognizes that the country is now on the second phase in its COVID-19 fight, “where the general direction is toward the safe and gradual reopening of the economy” to bring back jobs for Filipinos but still ensuring strict health protocols.
He said the Department of Trade and Industry (DTI) is pushing for its ‘REBUILD’ strategy which stands for ‘revitalizing businesses, investments, livelihoods, and domestic demand’.
“Part of stimulating demand is also the current campaign of DTI to ‘Buy Buy Buy Local’.”
“Part of stimulating demand is also the current campaign of DTI to ‘Buy Buy Buy Local’, to patronize locally produced goods to generate more local employment,” Lopez added.
He is also promoting e-commerce that can stimulate demand while minimizing the risk of getting infected with the coronavirus.
In a report of Fitch Solutions dated August 5, it forecast that consumer spending habits in the country this year will have a more negative impact than the Great Financial Crisis over a decade ago.
“Over 2020, we forecast real household spending contracting by -4.0 percent year-on-year, a significant drop from the 5.5 percent year-on-year growth we estimate for 2019,” the report noted.
During the 2009 global financial crisis, the country’s household spending declined by 2.9 percent.
Fitch Solutions noted that according to Google mobility data, travel to retail and recreational outlets dropped when the community quarantine measures were announced.
It slightly improved on May 16 when the government eased lockdown measures but improvement stalled from June 1 onward despite the lifting of restrictions, the report said.
But Fitch Solutions has an optimistic outlook for next year.
“This easing, along with the government’s stimulus plan, leads us to project a recovery in consumer spending, as we look into 2021. We believe there is the potential for consumer spending to bounce back in 2021 and we are forecasting real household spending to expand by 6.3 percent year-on-year,” it said.