The Philippine is fighting hard for COVID-19, it is taking the country in a bad condition. The year to year budget gap for the Philippine is getting wider, but the end of the pandemic is still not visible. The unbalanced expenses and incomes are taking the country deeper into a hole. With the alarming state, the government is seeking ways to pull the country out from getting into an even more tragic situation.
Money allocation for sustenance amidst COVID-19 in Philippine
On Wednesday, the bureau announced that a ₱140.2-billion shortage in the country’s budget for the month. CNN Philippines further elaborates the number is feared to have doubled from last July’s ₱75.3 billion deficit. Among the causes of the deficit in the Philippine is the allocation of money for COVID-19 related expenses.
The rising public’s spending is also suspected to have caused a great amount of shortage. In comparison from a year ago, public spending is at least 10% bigger now with a total of ₱374.7 billion. Philippine is still continuing the distribution of cash aid to 14.1 million families in need. In order to facilitate daily needs during the lockdown lasting from March to May, the government has been distributing allocation of money starting from ₱5,000 to ₱8,000.
Philippine: current financial state
Philippine might not be in the greatest condition right now. The country’s first-half economy has slimmed down to 9% compared to last year when coronavirus hasn’t coexisted. CNN Philippine reveals an 11.2% drop in the state revenues. Philippine only generated ₱234.5 billion in July 2020 against ₱264.1 billion from the previous year. The condition also affects tax collections. The Bureau of Internal Revenue reported a 21.4% slump. Subsequently, Custom duties also revealed a 4.8% decline due to the less-crowded international trade.
With the state’s current financial state, the government is readying itself for a much bigger gap. Officials expect budget gap might even grow up to 9.6% of gross domestic products for 2020. Additionally, the Treasury mentioned the current gap stood at 6.52% of GDP by the end of June. For the current time, COVID-19 prevention and cure will still become the main burden for the Philippine.
Government’s plan to recover the country’s economy
The Philippine is currently waiting for a ₱165.5 billion stimulus package. The plan will soon be signed into law and is expected to revive the economy in the next four months. The Philippine government also plans to take more loans from local and foreign sources to back up the COVID-19 programs.