Philippine Economy Shrinks for 5th Straight Quarter Amid Pandemic

Marielle Lucenio, Jojo Riñoza and Basilio Sepe
Manila
2021-05-11
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Philippine Economy Shrinks for 5th Straight Quarter Amid Pandemic Filipinos buy meat products at a market along a commercial street in Metro Manila, May 11, 2021.
Jojo Riñoza/BenarNews

The Philippines’ gross domestic product shrank by 4.2 percent in the first three months of 2021 to extend a COVID-19-related recession to five quarters, government officials who oversee the economy said Tuesday.

Their latest report on the economic outlook came the same day the Philippine health department announced that two Filipinos had tested positive for a highly infectious coronavirus variant, which was first detected in India, although the pair had no history of recent travel to that country.

“It has been 15 months since COVID-19 hit us. Throughout this unprecedented crisis, the government’s priority has been the total health and welfare of the people,” Socio-Economic Planning Secretary Karl Kendrick Chua, Finance Secretary Carlos Dominguez and Budget and Management Secretary Wendel Avisado said in a joint statement.

They noted that when infections spiked recently, the government had to impose “enhanced community quarantine” – the highest form of lockdown “to buy time to improve our health capacity system.”

“Our aversion to risk for the most part of 2020 has placed the country in a long period of quarantine. This came at a huge cost to the economy and the people,” the economic managers said, noting that the economy fell 9.6 percent last year – the lowest since 1947.

“This cannot go on in 2021,” they said, vowing that the government has changed its approach to managing risks rather than “just imposing blanket quarantines.”

While the overall growth forecast for the year stands at 6.5 percent to 7.5 percent, the past weeks’ lockdown status could pose downside risks, the trio said, noting growth relies on the safe reopening of the economy. They pointed out that the economy is likely to benefit from the acceleration of the vaccination program which began in March.

“Our economy may slow down in early 2021 given recent developments, but we will not backpedal,” the economic managers said, noting that with gradual declining COVID-19 cases, the government might be able to safely reopen the economy soon. 

The 4.2 percent first quarter decline was a “slower contraction” from the 8.3 percent drop in the fourth quarter of 2020, the officials said in their statement.

The Philippine Statistics Authority said construction, which fell by 24.2 percent and real estate and ownership of dwellings, which fell by 13.2 percent, and other services, which fell by 38 percent, were the “main contributors to the decline.”

Double-mutant variant detected

In an online briefing, meanwhile, Health Undersecretary Maria Rosario Vergeire said two Filipinos who tested for the B.1.617 variant had recovered already. The so-called “double-mutant” strain, first detected in India, has led to a massive wave of new COVID-19 infections in the South Asian nation.

“We wish to inform the public that we identified two cases with the said variant,” Vergeire said. “They tested positive for the India variant although there is no history of travel to India.” 

On Tuesday, India recorded 329,942 COVID-19 infections over the previous 24 hours and 3,876 deaths, according to the nation’s health ministry. 

The Philippines, meanwhile, recorded 59 deaths in the previous 24 hours, bringing the toll since the COVID-19 pandemic began to 18,620, and 4,734 infections, pushing the total to more than 1.1 million.

The first patient was identified as a 58-year-old man who arrived here on April 19 from the United Arab Emirates. He had been isolated in the northern Philippines and recovered on May 6, the health department said.

The other was identified as a 37-year-old man who flew in from Oman on April 10. He recovered 16 days later but underwent home quarantine through May 10, according to the health department. 

Other passengers on their flights all tested negative for the virus strain, health experts said. 

April surge

The Philippines saw a surge in COVID-19 cases last month when the country set a record for daily infections – 15,310 – on April 2. Infection numbers remained high in succeeding days, forcing the government to impose lockdowns, including a temporary travel ban for all travelers arriving from India, including Filipinos.

On Monday night, retired Gen. Carlito Galvez Jr., who leads the COVID-19 national task force, said the government aimed to inoculate between 25 million and 50 million Filipinos by September.

For herd immunity to happen, an estimated 70 million of the country’s 108 million people need to be vaccinated, officials have said. 

Also on Monday, the first shipment of about 200,000 doses of Pfizer vaccines arrived. Another 1.1 million doses are expected by next month.  

So far, about 7.5 million doses of COVID-19 vaccines have been delivered to the country and about 2.4 million Filipinos have received inoculations. Along with the Pfizer vaccine, the Philippines has received doses of vaccine developed by China’s Sinovac, the Sputnik V vaccine developed by Russia, and the vaccine developed by Astra-Zeneca, an Anglo-Swedish firm.

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