“New normal” to enable return to pre-COVID-19 growth by H1
MANILA, Philippines – Sustained implementation of Alert Level 1 in most parts of the country will allow the economy to return to its pre-pandemic growth rate by the first half of the year.
In a radio interview, National Economics and Development Authority (NEDA) Undersecretary Rosemarie Edillon said the Philippines could return to pre-pandemic levels as early as the first quarter until in the second quarter of 2022.
“If we can really maintain this, we estimate that we can get back to our 2019 level by the first or second quarter. But what we need is to catch up and grow faster,” said she declared.
For 2022, the government envisages gross domestic product (GDP) growth of 7-9%, compared to 5.6% last year.
In terms of nominal GDP, the Philippine economy stands at 19.387 trillion pesos, up from the 2020 level of 17.939 trillion pesos.
Before the pandemic, GDP fell only about 0.7% from the 2019 level of 19,518 billion pesos.
“This Alert Level 1 is expected to continue and eventually reach the point where there will be no more Alert Levels, which we are already preparing for in the transition plan,” Edillon said.
Currently, Metro Manila and 38 other areas are under Alert Level 1 until March 15. These regions benefit 62% of the economy, contributing 9.4 billion pesos per week, of which wages represent 3 billion pesos.
However, Edillon stressed that the companies were still monitoring the continuity of the current alert level.
“Companies are assessing whether the situation will be truly continuous before deciding to expand,” she said.
“Just because we’ve downgraded to Alert Level 1 doesn’t mean companies will immediately hire people,” she said.
NEDA said earlier that the economy would gain some 16.5 billion pesos a week if the whole country was placed under the most lenient pandemic alert classification.
This would bring 38% of the economy back to the “new normal” and help 52% of the country’s workers. It will also reduce 297,000 unemployed Filipinos in the next quarter.
Of the 16.5 billion pesos of additional economic output, 5.2 billion pesos will be earned by workers in terms of wages.