PH recovery hopes pinned on infra spending

Recovery from the pandemic-induced recession will entail not only fast-tracking mass vaccination and sustaining infrastructure development but also some more additional reforms pushed by President Duterte’s economic team on Monday.

Finance Secretary Carlos Dominguez III told the Sulong Pilipinas 2021 virtual forum that earlier reforms put in place by the Duterte administration eased COVID-19’s impact on the Philippine economy, citing that tax reform allowed the government to shore up revenues while rice tariffication slashed prices of the Filipino staple food before the pandemic struck and inflicted the Philippines’ worst post-war recession.

“Amid the extraordinary challenge we continue to face, we will not waver in our commitment to ensure that our macroeconomic fundamentals remain strong. We want to make sure that we can face the future with a deep war chest. We will continue to demonstrate our firm resolve of maintaining fiscal prudence while revitalizing the economy,” Dominguez said.

“We believe that our economic recovery should be patterned after the growth policies our administration put forward from the beginning of our term. Hence, we are maintaining the pace of our ‘Build, Build, Build program’ … With its high multiplier effect, we are expecting the ‘Build, Build, Build’ program to be the main driver of rebuilding the domestic economy,” he added.

The ongoing nationwide vaccination program, meanwhile, will allow the economy to reopen safely and restore livelihoods, Dominguez said. Millions of Filipinos lost their jobs and thousands of businesses closed down amid the longest and most stringent COVID-19 quarantine in the region.

To push forward with economic recovery, Dominguez urged passage of the government financial institutions unified initiatives to distressed enterprises for economic recovery (GUIDE) bill; two pending tax reform packages on property valuation and passive income taxation; as well as amendments to the antiquated public service, foreign investments and retail trade liberalization laws to enjoin more foreign participation.

“We will push for the passage of a bill that will further deepen the domestic capital markets by building a sustainable corporate pension system. We are also supporting reforms to save the military and uniformed personnel pension by making it fiscally sustainable for the long term,” Dominguez said.

Also, Dominguez said they proposed to jack up to a minimum of 75 percent of state-run corporations’ earnings their mandatory dividend remittances to the national government, from 50 percent at present, to collect more revenues while the government eyed to wind down its ballooning debt which was partly a result of massive borrowings to finance COVID-19 response.

“Amid the extraordinary challenge we continue to face, we will not waver in our commitment to ensure that our macroeconomic fundamentals remain strong. We want to make sure that we can face the future with a deep war chest. We will continue to demonstrate our firm resolve of maintaining fiscal prudence while revitalizing the economy,” Dominguez said.

“We believe that our economic recovery should be patterned after the growth policies our administration put forward from the beginning of our term. Hence, we are maintaining the pace of our ‘Build, Build, Build program’ … With its high multiplier effect, we are expecting the ‘Build, Build, Build’ program to be the main driver of rebuilding the domestic economy,” he added.

The ongoing nationwide vaccination program, meanwhile, will allow the economy to reopen safely and restore livelihoods, Dominguez said. Millions of Filipinos lost their jobs and thousands of businesses closed down amid the longest and most stringent COVID-19 quarantine in the region.

To push forward with economic recovery, Dominguez urged passage of the government financial institutions unified initiatives to distressed enterprises for economic recovery (GUIDE) bill; two pending tax reform packages on property valuation and passive income taxation; as well as amendments to the antiquated public service, foreign investments and retail trade liberalization laws to enjoin more foreign participation.

“We will push for the passage of a bill that will further deepen the domestic capital markets by building a sustainable corporate pension system. We are also supporting reforms to save the military and uniformed personnel pension by making it fiscally sustainable for the long term,” Dominguez said.

Also, Dominguez said they proposed to jack up to a minimum of 75 percent of state-run corporations’ earnings their mandatory dividend remittances to the national government, from 50 percent at present, to collect more revenues while the government eyed to wind down its ballooning debt which was partly a result of massive borrowings to finance COVID-19 response.

Amid calls for additional stimulus such as the Bayanihan 3 bill pending in Congress, Dominguez said they were in discussions with legislators to determine additional revenue sources to finance such off-budget expenditures.

The economic team was also looking at reducing non-essential expenditures to save money and realign them into the prolonged fight against the pandemic. INQ

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