December 07, 2021
ECCP at Work
Prices of basic commodities rose at a slower pace in November with food and energy costs mainly driving the increase, newest figures from the Philippine Statistics Authority show. National Statistician Dennis Mapa reported on December 7 an inflation rate of 4.2% for the month. This is milder than 4.6% in October and 3.3% in November 2020.
The Philippines is now under “minimal risk” classification for COVID-19, the Department of Health reported Monday, following a continued decline in infections. In a briefing, DOH Undersecretary Maria Rosario Vergeire said the average daily attack rate from November 22 to December 5 was 0.67 per 100,000 individuals. If the ADAR is less than one, the country’s classification can be lowered to minimal risk from low risk. The Philippines also posted a -57% growth rate in cases over the last two weeks.
Congress is expected to ratify the proposed P5.024-trillion national budget for 2022 by Dec. 13. Both the Senate and House of Representatives are reconciling conflicting provisions in their respective budget proposals in a bicameral conference. “We will try to finish as soon as possible, the bicam in four days because we need to ratify the proposed budget next week. Our target is Dec. 13 so that hopefully, President Duterte can sign it before Christmas,” Rep. Eric Go Yap, chairman of the House committee on appropriations, told reporters in an interview.
As the pilot run of the face-to-face (F-to-F) classes of the additional 117 schools, including 28 from the National Capital Region (NCR), started on Monday, an official of the Department of Education (DepEd) assured that they are constantly coordinating with the Department of Health (DOH) amid the reported creeping spread of Covid-19 Omicron variant in other countries.
After withstanding a third quarter Delta variant surge and ending this year on a high note, the Philippines is facing a “challenging” year ahead, with uneven economic growth seen to prevail given the “ills that followed COVID-19 out of Pandora’s box.” This is according to New York-based think tank Global Source, which projected that the country’s gross domestic product (GDP) would grow by 5.5 percent next year, same pace of expansion seen for this year.
Price hikes continued to decelerate in November with the inflation rate likely having returned to within the central bank’s target range, economists polled by the Inquirer last week said. Twenty out of the 21 economists expect a lower rate of increase in prices of basic commodities than October’s 4.6 percent. Fifteen forecasts were within the Bangko Sentral ng Pilipinas’ (BSP) 2 to 4 percent target band of manageable headline inflation.
The Department of Agriculture (DA) and Department of Energy signed a joint memorandum circular that will operationalize the Renewable Energy Program for the Agri-Fishery Sector (REPAFS) from 2022 to 2030 with a total funding of P7.98 billion. REPAFS will also act as the blueprint in the effective and efficient integration of RE in agriculture and fisheries sectors with six strategic directions including infrastructure and facilities support services, and research and development.
The government must lower tariffs on meat and feed products permanently and allocate revenues from these imported goods to boost domestic production in order to make food items, particularly meat, cheaper for Filipinos, experts said. Monetary Board member V. Bruce J. Tolentino told the BusinessMirror that the tariff reductions on pork imports must be made permanent as part of a proposed livestock development bill that seeks to modernize the country’s meat production.
President Duterte’s economic team has flagged a prolonged pandemic and next year’s presidential elections as potential spoilers to sustaining recovery from the slump wrought by COVID-19. As such, the Cabinet-level Development Budget Coordination Committee (DBCC) in its Fiscal Risks Statement 2022 recommended stepping up mass vaccination and preparing for new variants, which may crop up and reduce gains in containing the spread of the deadly coronavirus.
The prospect of complete devolution arises from two policies that will come into effect next year. Starting in 2022, the Supreme Court’s Mandanas ruling will require local government units (LGUs) to receive 40 percent of most national taxes (beyond the current practice of getting only from the internal revenue allotment or IRA). In exchange, however, local governments will also shoulder the responsibility over public services to be devolved under Executive Order No. 138 issued on June 1, 2021.
The Philippine economy will probably grow faster than expected this year, but elections next year and the growing inequality are risks to recovery, according to GlobalSource Partners, Inc. The research consultant expects economic output to expand by 5.5% this year and in 2022, faster than the 3.5% estimate it gave in August. It is also better than the government’s 4-5% goal.
The Philippine banking industry, which has not been spared from the global pandemic, is expected to recover moderately next year amid improving loan growth and as bad debts decline, Fitch Ratings said on Monday. “Loan growth is likely to accelerate with the resumption of business and consumer spending, buoying revenues and offsetting the pressure on margins stemming from excess liquidity,” it said in a report.
Global trade growth remains strong this year amid the pandemic but outlook for 2022 is still “very uncertain” due to a slowing economic recovery and disruptions of logistic networks and increases in shipping costs, according to a new UN report. A report of the United Nations Conference on Trade and Development (UNCTAD) said the strong economic recovery of the first half of 2021 has slowed during the second half, with economic growth of China in the third quarter was below expectations and lower than in previous quarters.
Little is known about the potential dangers posed by the Omicron coronavirus variant but concern over its spread is already threatening to wreck reopening plans in Asia-Pacific. After more than 20 months of strict border controls and restrictions on daily life, many countries in the region had tentatively started to loosen up and live with Covid -- months after their European and North American counterparts fully reopened. But it took only a matter of days to change that. Last month, after South African scientists detected a new variant, dozens of nations imposed travel bans on visitors from several southern African countries.