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Acting Secretary of NEDA, Karl Kendrick Chua
While the economic contraction slowed to 11.5 percent year-on-year in the third quarter after a record drop in the second quarter, the country’s chief economist sees more room for improvement during the final three months of 2020 with companies largely forced to resume operations. full operations and more. mass transit options available to workers.
When asked by the Inquirer if the pandemic-hit economy still underperformed during the July-September period with gross domestic product (GDP) growth of 8 percent quarter-on-quarter, Acting Secretary for Socio-Economic Planning Karl Kendrick Chua , responded Tuesday that turnout could be better, as easing quarantine restrictions should have induced a faster recovery compared to the second quarter, when 75 percent of the economy was halted.
National Statistician Claire Dennis Map told a news conference that, on a quarterly basis, the agricultural sector posted 1 percent growth, albeit a slightly slower pace than the 1.1 percent increase in production during the second quarter.
The industry and services sectors posted growth of 7.6% and 9.5% quarter-on-quarter, respectively, but still not enough to reverse the larger drop of 18% and 15.8% in the second quarter in compared to its first quarter production.
Chua, who heads the state planning agency’s National Development and Economy Authority (Neda), attributed the worse-than-expected year-on-year drop in third-quarter GDP to a two-week reversion to a tighter lockdown in Metro Manila and four neighbors. provinces that concentrated half of the economy in August, in addition to the difficulty of workers to resume their jobs due to the lack of public transport.
Chua admitted to the Inquirer that business and consumer confidence was also initially a concern during the third quarter “given the uncertainty when we returned to MECQ (modified enhanced community quarantine) and workers and consumers were unable to travel to do their jobs and shop. goods and services . “
However, Chua said that consumers and businesses were now changing their attitudes “as we see a significant improvement in our health system to treat the very sick and detect cases,” noting that “about 90 percent of the cases have already recovered. “
In the case of companies, the resumption towards 75 or 100 percent of their capacity “will have to be evaluated from company to company, but the policy now relaxes many restrictions that had prevented companies from operating at their optimal capacity,” he said. Chua. said.
“We also proposed more work shifts and public transportation to help companies generate more business. The implementation of Bayanihan 2 and the approval of the rest [bills in the recovery] The whole package will help companies to better cope with situations, ”added Chua.
Chua said he was hopeful that the top three industries that make up GDP would post double-digit growth in the fourth quarter compared to their third quarter performance.
Chua revealed that Neda would be monitoring economic developments in the midst of the pandemic more from one quarter to another, “so we immediately compare with the previous quarter, instead of four quarters ago.”
Quarantine restrictions, for example, were being adjusted on a monthly basis, depending on progress in containing the disease by location during the previous month.
Chua said that the economic team will review the macroeconomic assumptions as the largest drop in GDP at the end of September may result in an unemployment rate of up to 11 percent this year, in addition to a poverty incidence of 16 to 17.5 percent. hundred.
Malacañang said he was saddened by the 11.5 percent contraction of the economy in the third quarter of the year, but nevertheless believes that the worst is over, as this represents an improvement over the decline in the second. trimester.
“The economy has improved a bit, which shows that the worst is over,” presidential spokesman Harry Roque told a news conference.
He attributed the recent figures to the more restrictive modified enhanced community quarantine implemented in Metro Manila and the Calabarzon region in August to give the health care system and its workers a respite from the growing number of COVID 19 cases in the country.
The government has to reopen the economy, he said, but people must continue to keep in mind that the threat of COVID-19 persists and must continue to adhere to health protocols, particularly the use of masks, frequent hand washing and observation. physical. distancing. –With a report by Leila B. Salaverria INQ
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