According to the Philippine office of the Asian Development Bank ( ADB), economic recovery in the near term will be slow. One that will map the U-shaped as the country reels from the effects of the lockdown during the second quarter that made more than a fifth of the workforce unemployed in Luzon.
In addition, it could have driven ADB “five million Filipinos below the poverty line.”
Kelly Bird, country director of the ADB’s Philippines country office, said in a presentation to European business chambers last week.
They expected gross domestic product (GDP) to fall by 2.3-5.3 percent this year, gloomier than the 2-3.4 percent government estimate.
Bird said “tax revenue collection data in the first half of 2020 suggests that the economy could contract by more,” even though “worse is more likely now with the gradual opening of the economy,” referring to the eased restrictions under the quarantine of the general population that enabled three-fourths of economic activity to resume with minimum health standards beginning in June.
Hard-Lockdown in Mid-March Affected Everything
The country started with a hard lockdown in mid-March to stop the spread of the latest coronavirus that triggers COVID-19, with only critical businesses open.
Citing the new economic measures such as sales of cement and automobiles, exports, and imports of goods and the index of the purchasing manager, Bird said in May that “contraction may have broken out.”
The Metro Manila and neighboring regions accounted for two-thirds of the total production of the country.
The April labor force survey of the Philippine Statistics Authority put the national unemployment rate. It was at a 15-year high of 17.7 percent.
It was equivalent to 7.3 million unemployed Filipinos nationwide during the first full month of ECQ.
As such, Bird said, “recovery could be fragile and a protracted U-shape from 2020 to 2021.”
“Some sectors will take longer to recover—‘high contact’ sectors like tourism, segments of retail and services, private education providers, etc.,” Bird noted.
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