NEDA Secretary Balisacan gave a keynote message at the 8th Annual Public Policy Conference which includes the economic state of the Philippines and addressed current issues within it.
Socioeconomic Planning Secretary Arsenio M. Balisacan spoke at 8th Annual Public Policy Conference on Development Policy Research Month, which is intended to foster a culture of research and data and evidence use among the country's national and local policymakers and program planners.
The theme of the DPRM is all about post-pandemic recovery through social justice. It emphasizes the importance of making social justice a guiding principle of the country’s post-pandemic recovery plan, specifically human capital development and social protection, public health services and infrastructures, and environmental resilience.
In the case of the Philippines’ performance towards the Covid-19 pandemic, reports indicate it is a mix of good and bad newsews.
Good news
Data from the Philippine Statistics Authority (PSA) showed the country achieved a 7.8 percent growth in its real Gross Domestic Product (GDP) in the first semester of 2022. This was faster compared to other major neighboring countries in the Association of Southeast Asian Nations (ASEAN).
In just the second quarter, the real GDP increased by 7.4 percent.
The positive outcome is due to the relaxation of quarantine restrictions and increased vaccine rollout this year. There has also been an expansion of sectors on the supply side like the services sector at 9.1 percent and the industry sector at 6.3 percent.
Similarly, there has been an improvement in the employment sector.
The unemployment rate was from 7.2 percent in July 2021 to 5.2 percent in July 2022 where employment totaled about 47.4 million.
It was a big boost compared to the unemployment rate last year.
Meanwhile, underemployment rates also improved this year to 13.8 percent in July 2022 compared to 21.0 percent last July 2021.
Bad news
Some sectors in the economy have lagged and inflation accelerated.
In the second quarter of 2022, the agriculture, forestry, and fishing sector only grew by 0.2 percent, which is less than 1 percent.
Other than that, the inflation rate has greatly increased from 5.4 percent in May 2022, to 6.1 percent in June 2022. This is largely driven by a price hike in food inflation from 5.2 to 6.4 percent. The inflation rate rose further in July 2022 to 6.4 percent but slightly lowered to 6.3 percent in the next month.
Poverty incidence has also risen from 16.7 percent in 2018 to 18.1 percent in 2021 which is equivalent to around 2.3 million additional Filipinos being pushed into poverty. This is due to the immense scope of the health and economic crisis, as well as policy response issues.
The socioeconomic scarring in health and education was made worse by the poor’s limited access to adequate healthcare and tools needed for remote learning.
“This is expected to linger if it is not remedied,” Balisacan said.
This is accentuated by the poor's vulnerability to environmental shocks and a lack of social protection to mitigate the effects of such shocks.
These are the development concerns that are centered on this year’s DPRM theme.
Addressing these issues
In consultation and collaboration with various sectors, NEDA has begun drafting the 2023 to 2028 Philippine Development Plan which is framed by the 8-Point Socioeconomic Agenda. The goal of this plan is to reinvigorate poverty reduction and job creation by guiding the economy toward a high-growth path and developing a resilient, inclusive, and prosperous society.
“In the near term, we must protect the purchasing power of families, mitigate the socioeconomic scarring caused the COVID-19 pandemic, reduce the vulnerability of the poor and marginalized sectors, all while ensuring sound macroeconomic fundamentals through efficient government processes.” Balisacan explained.
“In the medium term, we aim to focus on job creation and rapid poverty reduction by addressing the most binding constraints to greater economic dynamism such as our infrastructure, regulatory environment and competition landscape, as well as public order and safety, peace, and security” He added.
In this agenda, the government aims to lower poverty incidence to a single digit by 2028, which is an imposing but achievable goal.
With post-pandemic recovery nearing, the government is also working on the full reopening of the economy.
In the health sector, this includes the Department of Health’s (DoH) campaign PinasLakas which seeks to increase vaccination rates across the country. Increasing the vaccination rates would protect more Filipinos against the virus and would enable them to walk more freely in different places.
Additionally, there is also a push to establish the Centers for Disease Control and Virology Institute of the Philippines to help boost the health system of the country.
Digital transformation of government processes is also underway to facilitate and improve social protection. This is related to the National Identification of the Filipinos which is the valid proof of identity that shall be means of simplifying public and private transactions, enrollment in schools, and the opening of bank accounts.
The PSA and Bangko Sentral ng Pilipinas (BSP) are in close coordination to hasten the rollout of the National ID to reach the target of 92 million national IDs released by 2023.
In the education sector, face-to-face is already being done and is expected to be fully implemented soon. This is expected to prevent future productivity losses and boost commercial activities, especially for Micro, Small & Medium Enterprises (MSMEs).
Additional investments are also being made in the social protection of the vulnerable segments of the population and enhancing human capital development.
This includes the efforts in the agriculture sector as farmers are assisted to lower input costs, develop new farming technologies, extend financial assistance, and strengthen the agricultural value chain.
Fuel discounts are also being given to farmers and fisherfolk.
Fuel-related aids are also included like the Targeted Cash Transfer Program by the DSWD which is giving P500 every month to the bottom 50 percent of houses across the country, the Libreng Sakay Program to help commuters in Manila and key cities in Visayas and Mindanao, and fuel subsidies under the Pantawid Pasada Program for tricycle drivers.
There are other alternative forms of transportation being considered for more environmentally friendly transportation.
Furthermore, the government is emphasizing the importance of improving skills to increase employability and promote alternative job arrangements when these prove to be effective and enhance productivity.
Govt. is not alone
The effort to provide assistance and improve economic welfare is not done by the government alone. It must be complemented by the resources, expertise, and capacities of the private sector.
The socioeconomic agenda emphasizes the increased participation of the private sectors in infrastructure investments, especially through Public-Private Partnerships.
Water, telecommunications, transportation, logistics, and energy infrastructure will be enhanced to create a favorable climate for increased investment in manufacturing, IT-BPOs, tourism, and the creative industries.
“We also see a greater role for the private sector in providing programs for skills development so that there will be no skills-job mismatch and so that our labor force becomes more competitive relative to our peers in the region.” Balisacan said.
There is no shortcut or easy way in solving the economic problems of the country. Everyone must work, and everyone must help each other.
The first step toward economic recovery is addressing the socioeconomic inequities and improving access to various opportunities to meet ambitious economic goals.
Government plans and policies must be linked to empower disadvantaged and marginalized populations and improve their well-being and quality of life.
“We at NEDA commit to this objective by enhancing national planning and monitoring and ensuring that our policies and programs are based on careful study anchored on data and a strong appreciation for rigorous policy research.” Balisacan ended his message.
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