Give cash to people to stimulate economy
Businessman Manuel V. Pangilinan said the country should “put more money in the hands” of the people—such as through cash aid—since a COVID-19 vaccination drive could do only so much to help the economy recover when consumers didn’t have money to spend.
Pangilinan, who heads the MVP Group of Companies that run critical businesses such as in telecommunications and energy, said in a financial briefing on Monday that a vaccination program was an important factor in addressing the fear that held back the economy last year.
“Certainly, it’s a very important element in alleviating the fear factor that has held back the economy in 2020 because people are simply afraid to go out,” he said during the question-and-answer portion for the financial results of Manila Electric Co. (Meralco), which he chairs.
“But that is only one factor. The other factor, because they’re related, [is] we’ve got to put more money in the hands of our people because even if the fear were lifted, a lot of our people are still unemployed. At least 4 million [based on latest official data]. So that’s 20 million if you count the families, 20 million people,” he said.
“If this contraction continues, as I think the economy is likely to contract in the first quarter, then it becomes that much harder to recover because people will have lesser and lesser money in the course of time,” noting that businesses would also suffer as a consequence.
During the briefing, he was asked if he was pushing for a stimulus package. He said it was up to the government to decide the best course of action based on the available resources. Nevertheless, he said a cash aid such as the conditional cash transfer for the poor would help.
“Well really at the end of the day, it’s up to the government. They have a better view of the overall fiscal position. But my view is that it would help, yung ayuda [the cash aid],” he said. “We’re seeing a bit of a slowdown in certain of our businesses in terms of purchases. So we’d like to think that’s probably attributable to the fact that people are starting to have some difficulty with the continued contraction,”
“It’s what [US President Joe] Biden did,” he said, referring to his administration’s $1.9-trillion stimulus plan, which was passed during the weekend by the US House of Representatives. INQ
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