August 27, 2021
Metro Manila (CNN Philippines, August 26) — The Philippine economy will not rebound to its pre-pandemic levels during the term of President Rodrigo Duterte, estimates from the National Economic and Development Authority (NEDA) showed Thursday.
Still, Socioeconomic Planning Secretary and NEDA chief Karl Kendrick Chua said prospects for this year "remain encouraging".
His bullishness was being driven by the government's ramped-up vaccination drive against COVID-19, the "safe reopening" of the economy, and the full implementation of the recovery package, such as the 2021 budget, Corporate Recovery and Tax Incentives for Enterprises Act (CREATE) and Financial Institutions Strategic Transfer (FIST) law.
“These will allow us to recover to pre-pandemic levels some time at the end of 2022 if not, early 2023,” Chua said during the House Committee on Appropriations’ deliberations on the proposed ₱5.024 trillion national budget for 2022.
"This will also help prevent long-term scarring and productivity losses," he added.
The Philippines crawled out of a pandemic-induced recession with 11.8% growth from a year ago in the second quarter of 2021 despite the reimposition of the hard lockdown in Metro Manila and nearby provinces.
However, on a quarter-on-quarter basis the economy was still down by 1.3%.
Chua previously said this year's restrictions are different from 2020 as more industries and services are allowed to operate. Public transportation also got authorization for additional capacity, he added.
"This is a clear indication that managing risks, instead of shutting down large segments of the economy, stands a far better chance of improving both economic and health outcomes," he earlier said.
But an international think tank, Capital Economics, expressed a bleak outlook on the Philippines' capacity to record a strong economic rebound, citing the quarter-on-quarter decline.
“That leaves GDP around 9% below its pre-crisis level and a whopping 17% behind its pre-crisis trend,” said Capital Economics senior Asia economist Alex Holmes.
National Statistician Dennis Mapa said earlier this month the economy needs to grow by 8.2% to meet the lower end of the government’s 2021 target band in the last half of the year, and by 10.2% to meet the higher endpoint.
The government recently downgraded its growth target to a 4-5% range.