Urban poor more badly hit by coronavirus crisis — NEDA chief

MANILA, Philippines — Poverty incidence in urban areas likely took a bigger hit from the socioeconomic fallout caused by the COVID-19 pandemic as infections surged in more developed parts of the Philippines, the country’s chief economist said.

“Some sectors will see higher poverty; some, lower poverty,” Acting Socioeconomic Planning Secretary Karl Kendrick T. Chua replied in response to the Inquirer’s query last Thursday if the first-half recession could aggravate poverty incidence.

The Philippines’ gross domestic product (GDP) fell by a record 16.5 percent during the second quarter, resulting in a 9-percent recession in the first six months.

“Since most poor are rural and in agriculture, then the impact is less than in urban [areas], where the virus problem is more pronounced,” said Chua, who heads the National Economic and Development Authority (NEDA).

Metro Manila and four neighboring provinces accounting for about two-thirds of the economy on Aug. 4-18 reverted to a more stringent modified enhanced community quarantine (MECQ) after medical front-liners sought a “timeout” amid a surging number of COVID-19 infections.

While the bulk of the economy shed trillions of pesos in output and millions of jobs at the height of the longest and strictest lockdown in the region, Chua noted that farmers and fisherfolk in the countryside — where there were relatively fewer COVID-19 cases — managed to go on with their livelihood.

Philippine Statistics Authority (PSA) data showed that while nationwide poverty incidence fell to 16.7 percent in 2018 — which translated into 17.7 million Filipinos living in poverty two years ago — and was reflected in similar declines across 11 basic sectors, Filipinos living and working in the countryside remained poorer compared with those in urban areas.

In 2018, poverty incidence fell from 23.3 percent in 2015, which translated into almost six million Filipinos lifted out of poverty.

The PSA’s preliminary estimates of 2018 poverty incidence on a per sector basis showed that the highest rates — although lower than 2015 figures — were posted among farmers (31.6 percent in 2018, down from 40.8 percent in 2015); fisherfolks (26.2 percent, down from 36.9 percent); and individuals residing in rural areas (24.5 percent, down from 34 percent).

Among children, poverty incidence declined to 23.9 percent two years ago from 2015’s 33.5 percent, although the fourth highest among the 11 sectors.

As for self-employed and unpaid family workers, their 2018 poverty incidence rate was 18 percent (against 26.2 percent in 2015); and among women, 16.6 percent (vs. 23.9 percent previously).

Among persons with disability (PWDs), 14.7 percent were poor in 2018. Poverty incidence among PWDs was not measured in 2015.

The lowest poverty incidence rates were posted in the following sectors: youth, 14.7 percent (from 20.5 percent in 2015); individuals residing in urban areas, 9.3 percent (from 13.2 percent); senior citizens, 9.1 percent (from 14.4 percent); as well as migrant and formal workers, 8.8 percent (from 14.4 percent).

A discussion paper titled “Poverty, the Middle Class, and Income Distribution amid COVID-19” published by the state-run Philippine Institute for Development Studies (PIDS) last Tuesday projected that “the number of poor Filipinos could rise by about 1.5 million from the baseline figures, if everyone’s incomes contract by 10 percent, even with the SAP (social amelioration program) and SBWS (small business wage subsidy) in place,” referring to the dole outs given away to poor families and displaced workers of micro, small and medium enterprises (MSMEs) at the height of the COVID-19 lockdown.

“Without SAP and SBWS, the number of poor would rise even by 5.5 million,” the PIDS paper said.

The government targets to slash the poverty rate to 11 percent by 2022.

EDV