World Bank urges ‘high levels of testing, tracking, quarantines’
Lockdowns to contain the spread of the COVID-19 disease have been necessary but will hurt economies in East Asia and the Pacific such that the World Bank on Tuesday urged “high levels of testing, tracking and quarantines” across the region, including the Philippines.
The World Bank report titled “East Asia and Pacific in the Time of COVID-19” showed a 2020 gross domestic product (GDP) growth forecast for the Philippines of 3 percent at “baseline”—defined by the Washington-based multilateral lender as “a scenario of severe growth slowdown followed by a strong recovery” by the third quarter.
At a “lower-case” scenario of “a deeper contraction followed by a slugging recovery,” the World Bank expects the Philippine economy to contract by 0.5 percent this year if there would be a “drastic slowdown in domestic consumption and investment, with echo effects into 2021.”
The World Bank’s latest forecasts for the region took into account developments as of March 27.
Besides the impact on tourism, which based on World Bank estimates contributed more than 10 percent to the Philippines’ GDP, remittances from Filipinos working and living abroad would also be affected as global inflows were “drying up” amid the pandemic, World Bank chief economist for East Asia and the Pacific Aaditya Mattoo said during a virtual press briefing attended by the Inquirer Tuesday.
In the report, the World Bank attributed its updated 2020 forecasts for the Philippines to take into account the “impact of the COVID-19 outbreak and the associated community quarantine.”
“The quarantine restricts all nonessential movement of people and closed down businesses and government agencies in Luzon—which accounts for 70 percent of national GDP—until April 14. Domestic consumption is expected to slow down sharply in the first half of 2020,” the World Bank noted.
Asked if lockdowns implemented in the Philippines and other countries globally were a good or a bad thing, Mattoo replied: “The biggest challenge is the human cost. And the priority has to be to stop the suffering. We need to contain the pandemic and we need to develop the capacity to treat it. Even in industrial countries—governments everywhere in the world, it is now becoming evident that unless you are especially well-prepared, suppression of this pandemic now requires drastic action—strong internal social distancing and travel restrictions.”
But Mattoo pointed to South Korea and Singapore, which in the past had dealt with the MERS and SARS outbreaks, respectively, as two examples of containing COVID-19 through “much less disruptive measures.”
“Some countries are more or less capable of taking these drastic actions. But all countries seem to have gravitated toward the view that at least in the short term, you have to take these actions regardless, they are arguing and plausibly, of the economic cost. But this economic cost is not easy to sustain in the poorest countries with large informal workers,” Mattoo said.
In the case of the Philippines, Mattoo said: “To contain this pandemic now, we can in all countries with external support, and countries like [South] Korea and China are now in a position to extend assistance and collaborate with institutions like the [World Bank] to create better capacity … It isn’t too late to develop that capacity to test, to trace [and] to quarantine,” noting that the Philippines “exports” nurses around the world. INQ
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