Duterte’s 5th Sona expected to tackle economic recovery

·5 min read

LOCAL government and business leaders expect President Rodrigo Duterte to lay out his recovery plan for the economy when he delivers his fifth State of the Nation Address (Sona) on Monday, July 27, 2020.

Many businesses have been forced to close due to the effects of the lockdowns implemented to contain the spread of the coronavirus disease 2019 (Covid-19) pandemic, which struck the country in March.

With most major urban centers in the country still under some sort of community quarantine, including Cebu City which is the only local government unit to be on modified enhanced community quarantine, establishments that are open are not operating in full capacity.

Cebu City Mayor Edgardo Labella said small and medium enterprises have been particularly affected by the impact of the health crisis.

Labella hopes the President has plans to prevent mass unemployment.

The Mandaue City Government echoed the mayor’s sentiment, saying it expects Duterte to tackle economic revival.

John Eddu Ibañez, Mayor Jonas Cortes’ executive secretary, said many residents have already lost their jobs as a result of closures of some companies in the city.

Ibañez hopes the National Government will continue to provide assistance to local chief executives to jumpstart the city’s economy,

He also hopes the City will get help in securing vaccines for Covid-19 in the future.

Unlike Cebu City, Mandaue City is on general community quarantine (GCQ), which has more relaxed quarantine measures.

Selected establishments have been allowed to resume limited operations provided minimum health standards are in place.

Ibañez said the City Government would rather remain on GCQ after July 31.

The local business sector is also optimistic that Duterte’s Sona will provide more insight into economic issues the country is facing amid the pandemic.

“We are hoping we can get more government support for our distressed micro, small and medium enterprises (MSMEs) which are the main economic drivers of Cebu and also pump priming the tourism sector to create more jobs,” said Cebu Chamber of Commerce and Industry president Felix Taguiam.

Steven Yu, his counterpart at the Mandaue Chamber of Commerce and Industry (MCCI), said they expect the President “to report on the economic status of the country and the plans and programs for recovery to pre-Covid levels.”

Yu said they look forward to hearing about the Bayanihan to Recover as One bill that will authorize the President to realign funds for the country’s coronavirus response and the national identification system that will establish a single national identification system for all citizens and resident aliens of the Philippines.

The MCCI also wants to hear about the Accelerated Recovery and Investments Stimulus for the Economy of the Philippines bill that will pump P1.3 trillion to the economy as a stimulus package in response to the Covid-19 crisis.

Rey Calooy, president of Filipino-Cebuano Business Club, hopes the National Government will focus on helping MSMEs.

“We expect more on how we revive the shattered economy. MSMEs are now still quandering on a winning strategy against Covid-19,” he said.

The country’s second quarter gross domestic product (GDP) performance is expected to be worse than the first quarter, considering that the economy was almost at a standstill during the implementation of complete lockdowns in key cities across the country in April and May.

Philippine GDP, or the sum of goods and services produced in the country, fell by 0.2 percent in the first quarter, the first contraction since the 1998 Asian financial crisis.

However, in a virtual forum early this month, Finance Secretary Carlos Dominguez III said in his presentation that “signs of recovery are emerging.”

He cited Bureau of Customs (BOC) revenues that surpassed the collection target for June and an uptick in manufacturing output.

Acting Socioeconomic Planning Secretary Karl Kendrick Chua said the economy still contracted in May, but there was an improvement from the “deepest contraction in April.”

Finance Assistant Secretary Antonio Lambino II, in a press conference following the forum, said the BOC collected P42.54 billion in June, exceeding by 4.4 percent the P40.74-billion target for the month.

Aside from the increase in BOC collection, the purchasing managers’ index (PMI) also improved to “more normal territories in June,” according to Chua. The PMI rose to 49.7 in June from 40.1 in May.

How fast the economy will rebound to positive territory is dependent on the implementation of a recovery program and the citizenry’s cooperation in maintaining minimum health standards, Chua said.

The executive branch is talking with Congress ahead of Duterte’s Sona for the approval of a fiscal and financial stimulus program under the proposed Bayanihan to Recover as One Act.

Dominguez also cited the manufacturing uptick in his presentation.

He noted that overall manufacturing capacity utilization increased to 73.4 percent in May compared to 71.2 percent in April.

Dominguez said government initiatives, such as providing loans for start-up businesses might help the country cope with the effects of the Covid-19 crisis.

He reported that the Department of Trade and Industry and the Small Business Corp. provided P1 billion to businesses affected by the lockdown.

Meanwhile, the Philippine National Police is yet to monitor any threat against Duterte’s fifth Sona on Monday.

Lt. Gen. Guillermo Eleazar, deputy chief for operations, said Sona-related protest actions will be held inside the University of the Philippines campus in Diliman as the Quezon City government did not issue a permit to militant groups to gather along Commonwealth Ave., the usual venue for Sona rallies.

This was in line with the directive issued by the Department of the Interior and Local Government prohibiting mass gatherings to prevent the spread of Sars-CoV-2, the virus that causes Covid-19. (JJL, KFD, JOB, SunStar Philippines)