Finance Secretary Carlos Dominguez III on Tuesday presented to the House of Representatives a P1.45-trillion package of fiscal measures to ensure that the economy would “bounce back” from the impact of the coronavirus pandemic, which has all but wiped out this year’s growth.
In a teleconference with the special House panel to respond to the COVID-19 threat, Dominguez formally proposed the stimulus program, of which P583.8 billion, or more than half of its funds, would be used as emergency assistance to vulnerable groups.
He said the administration’s economic team had adopted a socioeconomic strategy anchored on four pillars: emergency support for vulnerable groups, marshaling resources to defeat COVID-19, emergency fiscal and monetary actions to keep the economy afloat, and an economic recovery plan.
Officials estimated that the country’s gross domestic product (GDP) would stagnate or even contract 0.8 percent in 2020, considering the severe impact of the pandemic, especially the lockdown in Luzon and several other regions, on travel, tourism, exports, remittances and consumption.
This assumes that the pandemic will last until the middle of the year, according to the Department of Finance (DOF) chief.
The first pillar of emergency aid for vulnerable sectors includes the P205-billion subsidy for 18 million poor families affected by COVID-19, which also covers beneficiaries of the cash transfer program. That amounts to P5,000 to P8,000 in assistance per family per month over a two-month period.
Aid to small businesses
It also covers the P51 billion in wage subsidy for employees of small businesses, and P120 billion in credit guarantee for affected small businesses.
The wage subsidy is expected to benefit 3.4 million employees, who will receive between P5,000 and P8,000 per month for up to two months.
The second pillar involves P37.2 billion worth of medical resources for health workers and COVID-19 patients, including P22 billion in Philippine Health Insurance Corp. (PhilHealth) coverage for related expenses for medical front-line workers and coronavirus patients.
The third pillar covers P310 billion in additional financing from multilateral agencies, as well as the Bangko Sentral ng Pilipinas’ purchase of P300 billion in government bonds to fund COVID-19 response measures.
The final pillar is an economic recovery plan that involves the creation of an interagency task force to design a “bounce-back plan” for a postquarantine scenario, and investment in social and infrastructure programs.
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