Finance Secretary Carlos G. Dominguez III INQUIRER File Photo
President Duterte’s chief economic manager on Tuesday conceded that the longer lockdown imposed in Metro Manila and four neighboring provinces after the surge of COVID-19 cases would hurt growth prospects for 2021.
Finance Secretary Carlos Dominguez III told Bloomberg TV that first-quarter and full-year gross domestic product (GDP) expansion would be “lower than what we expected.”
Dominguez said the two-week enhanced community quarantine in National Capital Region, which included the provinces of Bulacan, Cavite, Laguna and Rizal—in all accounting for half of the Philippine economy—would shed about “one-half of 1 percent” from this year’s growth target.
Economic managers had projected a conservative 6.5 to 7.5 percent GDP growth in 2021 following the record 9.5-percent drop last year—the Philippines’ worst post-war recession.
Private-sector economists expected the first-quarter GDP decline to be sharper than the 0.7-percent posted a year ago.
Dominguez said just like other countries experiencing another surge in coronavirus infections, the Philippines was coping and able to minimize deaths to about 12 per 100,000 people—relatively low globally.
The finance chief said the recent huge cut in corporate income tax rates retroactive to July last year, dole-outs to the poor and most vulnerable sectors during the most stringent lockdowns as well as support to flagging businesses had formed part of the government’s fiscal support for the pandemic-battered economy.
While most other multilateral institutions had slashed their respective 2021 GDP growth forecasts for the Philippines, the Washington-based International Monetary Fund on Tuesday projected a higher 6.9 percent from 6.6 percent previously.