The government must raise confidence and positivity levels in the country to restart and revive the economy, primarily through focus on four key drivers of confidence, foremost of which is improving the Philippine public health system’s capacity, according to a legislator.
Rep. Joey Sarte Salceda, speaking at the 3-part PHILEXPORT General Membership Meeting held online last June 9, said economic and trade growth is closely linked to the level of confidence the consumer, financial, business and investor markets have.
To overcome the impact of COVID-19, Salceda said four growth drivers should be given a boost by the government to strengthen economic and health confidence.
Foremost of these drivers is “assurance of health.” “Mas marami pa dapat kailangang gawin para mapanumbalik ang pangkalahatang tiwala [on health] … para mabalik lang yung kompyansa ng tao para lumabas sila,” said Salceda, as he called for greater testing, tracing and treating of COVID-19 cases.
Another driver is assurance of income through such measures as stimulus package, income support, and wage subsidies, among others.
Assurance of employment is also an important driver, said the solon. This can be achieved through efforts geared toward job protection and creation, insolvency prevention through credit stimulus and corporate recoveries.
There should also be assurance of growth via structural reforms and passage of measures including the Corporate Recovery and Tax Incentives for Enterprises Act (CREATE), Public Service Act (PSA), Foreign Investments Act (FIA), and Retail Trade Liberalization Act (RTLA).
“The sooner we perk up the spirits of consumers, entrepreneurs, businesses and investors, the quicker and the more V-shaped the recovery can be,” Salceda, who is also the chairman of the House Committee on Ways and Means, said.
A V-shaped recovery means that the economy suffers a sharp but brief period of economic decline but bounces back quickly to its baseline before the crisis.
Salceda is one of the principal authors of House Bill No. 6815, also known as the “Accelerated Recovery and Investments Stimulus for the Economy of the Philippines” Act or ARISE Philippines Act.
The bill was approved on final reading by the House on June 4, 2020 and transmitted to the Senate on June 8. It calls for the funding and establishment of an economic stimulus package for the country’s growth and development in the aftermath of COVID-19.
The proposed stimulus package is seeking to offer various forms of assistance to MSMEs and other key sectors affected by the COVID-19 crisis, while at the same time rebuilding consumer confidence.
The P1.3-trillion package is expected to protect and assist up to 15.7 million workers, create three million short-term jobs, and 1.5 million infrastructure jobs over three years, and help up to 5.57 million MSMEs, both formal and non-formal. The package would be used to fund wage subsidies and cash-for-work programs for displaced workers, zero-interest loans for companies, and loan guarantees for banks.
“We must overcome our fear. Not just have hope but we must overcome our fear because there is sufficient, fundamental basis to trust that this economy will still be one of the fastest growing economies of Asia and in the world,” Salceda stressed.