August 17, 2021
ECCP at Work
The country’s portal and mobile app for issuing COVID-19 vaccination certificates is expected to become operational in a few weeks, Presidential Spokesperson Harry Roque said. VaxCertPH is the platform being developed by the Department of Information and Communications Technology to issue digitally signed COVID-19 vaccine certificates to fully inoculated Filipino citizens. In preparation for the launch, Roque said local government units are now being trained to correct erroneous records of vaccinees and to guide constituents in availing of the certificates.
Local exporter shipments continue to fall behind as global shipping companies prioritize larger economies amid a container shortage in international trade, the head of an industry group said. The global shipping industry has been facing a shortage of vessel space amid the pandemic, pushing freight rates higher and delaying goods shipments. Philexport said 80 out of nearly a hundred member companies that responded to a survey said they failed to ship goods because of the shortage.
Latest preliminary BIR data obtained by the BusinessMirror showed the bureau’s collection in the seven-month period settled at P1.206 trillion in the seven-month period, narrowly missing its target by 1.65 percent or P20.28 billion. However, this is still higher by 7.94 percent or P88.7 billion compared to its revenue take of P1.12 trillion in the same period last year. BIR Deputy Commissioner Arnel Guballa pointed to the lockdown restrictions in the pandemic as the reason behind the bureau’s failure to hit its target for the seven-month period.
In a research note on, Moody’s Analytics said Philippine recovery has been affected by the relatively strict movement controls during the quarter as the country continued to struggle to contain Covid-19 cases. The research firm also said the slow pace of the vaccination rollout remains a major drag and a downside risk to the Philippines’ economic recovery as only 10 percent of the total adult population of the country is fully vaccinated. Given these conditions, the think tank said they maintain their assumption that the country will not recover lost output up until next year.
Data shared by Finance Secretary Carlos Dominguez showed that 28.23 billion liters of fuel has been marked from September 4, 2019 to August 13, 2021. The duties and taxes collected by the Bureau of Customs from fuel products totaled to P245.6 billion. Meanwhile, the excise taxes generated by the Bureau of Internal Revenue from petroleum products amounted to P29.78 billion. Majority or nearly three-fourths of fuel marked so far by the government is in Luzon, while more than 20 percent and around five percent are in Mindanao and Visayas, respectively.
The DOH said the Philippines’ first case of the Lambda coronavirus variant is a 35-year-old female, who was asymptomatic and tagged as recovered after undergoing a 10-day isolation period. It is not yet clear if she is a returning overseas Filipino (ROF) or if the infection is a local case, the department said. The Lambda variant was first identified in Peru in August 2020. It was classified as a "variant of interest" by the World Health Organization last June. The DOH said the variant has "the potential to affect the transmissibility" of the coronavirus and is currently being monitored for its possible clinical significance.
OCTA Research expects new infections to continue rising this week, citing as basis the country’s number of new COVID-19 cases hitting a growth rate of 29 percent last week. Based on current trends, the Philippines is now averaging 11,000 new cases per day, apparently due to the stronger and more aggressive Delta variant. Metro Manila continues to post the highest number of new cases with an average of 3,066 new COVID infections daily. OCTA fellow Guido David said the current reproduction number in the National Capital Region is at 1.90.
Tax collections from alcohol and tobacco products rose 40.8% in the first half due to the easier quarantine regime, as well as increased rates that took effect at the start of the year, according to preliminary data from the Department of Finance. Taxes generated by tobacco products rose 40.2% year on year to P86.2 billion in the six months to June. Collections from alcohol products rose 42.1% to P40.8 billion. Easier lockdown rules helped buoy sales of such products and increased the tax take of the government, Assistant Secretary Maria Teresa S. Habitan said.
The next administration needs to be willing to tweak the National Anti-Money Laundering and Countering the Financing of Terrorism Strategy (NACS) to strengthen the Philippine case for exiting the gray list of the Financial Action Task Force (FATF) by 2023, Anti-Money Laundering Council (AMLC) Executive Director Mel Georgie B. Racela said. The current NACS was adopted in 2018 and is in effect until 2022. Mr. Racela said the AMLC is in the process of updating the NACS to take into account the action-plan items which the FATF said need to be addressed in order to leave the gray list.
Moody’s Analytics lowered its growth forecast for the Philippine economy to 4% this year, citing the impact of prolonged restriction measures that were paired with “limited” government support. This new projection is lower than the 4.9% gross domestic product (GDP) growth outlook penciled in last month, and is below the 6-7% full-year target of the government. Moody’s Analytics revised the full-year forecast after the Philippines reported an 11.8% GDP annual growth in the second quarter. Quarter on quarter, GDP declined by 1.3%, reflecting the impact of the stricter lockdown from late March to April.
The National Government’s debt service bill rose to P773.79 billion in the first half, as principal payments nearly doubled from its year-ago level, data from the Bureau of the Treasury (BTr) showed. In June alone, debt payments increased by 146.6% to P150.195 billion from P60.911 billion recorded in the same month last year. The government borrows from local and foreign sources to plug its budget gap that is seen to widen to 9.3% of gross domestic product (GDP) this year. Its borrowings were ramped up in 2020 as revenues plunged and spending ballooned amid the coronavirus pandemic. This translated to bigger debt payments as obligations matured.
The taxman has stepped up its campaign against tax evasion with 84 cases filed in the Department of Justice during the first half, the Department of Finance (DOF) said. In a statement, the DOF said these complaints that the Bureau of Internal Revenue (BIR) lodged against alleged tax evaders involved a total of P3.15 billion in unpaid taxes. Citing a recent report of Internal Revenue Deputy Commissioner Arnel Guballa to Finance Secretary Carlos Dominguez III, the DOF said the BIR also aimed to collect about P1.54 billion in tax liabilities from 17 cases pending in the Court of Tax Appeals as of June.
In an administrative order released earlier this week, Agriculture Secretary William Dar ordered to stretch the validity of sanitary and phytosanitary permits issued to agricultural importers to 90 days from 60 days, factoring in logistical problems that are not unique to the Philippines but are being felt across the globe. Aside from meat, other products such as animals, animal feeds and feed ingredients, animal products and by-products including meat products, eggs, milk, dairy, veterinary drugs, and biological products will also be covered by the order.
The projected shortage in fish, pork and vegetable supply should be addressed to keep prices stable especially amid the wet season and with La Niña threatening food production by year-end. Citing estimates of the Department of Agriculture (DA) as of mid-July, Neda said pork supply would end 2021 with a 199,344-metric ton (MT) deficit, or 45 days’ worth of stocks, despite a 175.9-percent year-on-year jump in imports during the first half. Besides a possible pork shortage, Neda said “lowland vegetable production and fisheries supply are also expected to undershoot at 1,267,804 MT and 135,135 MT, or only at 80 percent and 96 percent sufficiency level, respectively,” citing DA and Bureau of Fisheries and Aquatic Resources reports last month.
Despite exiting five straight quarters of economic contraction, the Philippines is not yet out of the woods as rising COVID-19 cases may prompt the government to extend the enhanced community quarantine (ECQ) in Metro Manila beyond Aug. 20, according to economists. Citi economist for the Philippines Nalin Chutchotitham said his firm was expecting the country’s gross domestic product (GDP) to grow by 4.9 percent this year, a reversal of last year’s contraction of 9.1 percent, but noted downside risks from a potential prolonged lockdown. For 2022, Citi sees the economy growing at a faster pace of 6.8 percent.
Already 10.6 million were out of work and 7.8 percent of labor income was lost in 2020. Based on the year-on-year comparison to 2019, employment in Asean last year declined by what the report called a “staggering” 6.7 million jobs. The region is projected to see working hour losses of 7.4 percent in 2021 in Asean, equivalent to the working time of about 21 million full-time workers in Asean, assuming a 48-hour week. There were working hour losses of 8.4 percent in 2020, equivalent to the working time of about 24 million fulltime workers.
Trade Secretary Ramon Lopez is proposing a policy when only vaccinated individuals will be allowed to move around during a strict lockdown. Lopez told Konsyumer atbp that this could be looked at as future policy when the country shall have achieved herd immunity or more people shall have been vaccinated. Lopez said countries with high vaccination rates have adopted a similar policy.