Flattening the fear
It is now almost nine months since the Philippines first went into lockdown in response to the Covid-19 pandemic. The resulting economic recession, with GDP expected to contract by 9.5% this year, is proving much more fearsome beyond the continuing health problem. Early hopes of a quick rebound in 2021 have since been dashed by business losses and shutdowns,as well as high unemployment and the continuing spread of the coronavirus that has made it impossible to completely relax quarantine and distancing rules. While the government is striving to “flatten the fear” and turn gloomy consumer and business sentiment around to revive the economy, we think it will be a slow ascent for the economy, with GDP anticipated to grow only 5% in 2021, returning to its 2019 level only by late 2022. Moreover, the outlook comes with considerable downside risks given the daunting major uncertainties surrounding vaccine procurement and distribution that will require the country to live with Covid-19 far longer than we had previously anticipated. The rest of this report discusses challenges with fiscal and monetary policy accommodation and the prospects of proposed legislation to help support economic recovery.
Now read on...
Register to sample a report