In­fra­struc­ture to off­set TRAIN job loss

Business World - - FRONT PAGE - — Melissa Luz T. Lopez

UN­EM­PLOY­MENT should con­tinue to ease in the com­ing years, as planned in­fra­struc­ture de­vel­op­ment ab­sorbs work­ers laid off by firms seek­ing to weather higher levies un­der cur­rent tax re­forms, the gov­ern­ment’s Bud­get chief told re­porters on Wed­nes­day.

Bud­get Sec­re­tary Ben­jamin E. Dio­kno said in a brief­ing that he ex­pects job­less­ness in the coun­try to main­tain its down­trend, sup­ported by the “Build, Build, Build” pro­gram of the ad­min­is­tra­tion of Pres­i­dent Ro­drigo R. Duterte that plans to spend more than P8 tril­lion on ma­jor in­fra­struc­ture un­til 2022, when he ends his six-year term.

“We can build for­ever. Look at Sin­ga­pore,” Mr. Dio­kno said, cit­ing the “mul­ti­plier ef­fect” of in­fra­struc­ture projects and other ini­tia­tives like the jeep­ney mod­ern­iza­tion pro­gram.

Mr. Dio­kno made the re­mark when asked about lay­offs an­nounced by a soda pro­ducer, who cited or­ga­ni­za­tional “re­struc­tur­ing” in the wake of ad­di­tional taxes im­posed on sugar-sweet­ened drinks start­ing Jan­uary.

Repub­lic Act No. 10963, or the Tax Re­form for Ac­cel­er­a­tion and In­clu­sion (TRAIN) Act that was signed into law in De­cem­ber last year, im­posed an ex­cise rate of P6 per liter on drinks con­tain­ing caloric or non-caloric sweet­ener and P12 per liter on drinks con­tain­ing high-fruc­tose corn syrup. In­stant cof­fee mixes and milk are ex­empted from this new tax.

All four to five tax re­form pack­ages — of which TRAIN is just the first — are pro­jected to con­tribute about a fourth of the P8.13 tril­lion needed to make “Build, Build, Build” come true.

Philip­pine Statis­tics Au­thor­ity data show un­em­ploy­ment eased to five per­cent in Oc­to­ber last year from April’s 5.7%, even as the lat­est level was still worse than Oc­to­ber 2016’s 4.7%.

Un­der­em­ploy­ment — in­volv­ing those who want an ad­di­tional job or more work hours — fell to 15.9% in Oc­to­ber last year from April’s 16.1% and from Oc­to­ber 2016’s 18%, re­flect­ing im­prove­ment of job qual­ity as the econ­omy grows.

The Duterte ad­min­is­tra­tion is step­ping up spend­ing on in­fra­struc­ture projects in hopes of spurring gross do­mes­tic prod­uct (GDP) growth to a faster 7-8% an­nual pace from this year to 2022, from last year’s 6.7%, 2016’s 6.9% and a 6.2% an­nual av­er­age in 2010-2015.

In­fra­struc­ture spend­ing, un­der “Build, Build, Build,” will in­crease to P1.84 bil­lion in 2022, equiv­a­lent to 7.3% of GDP, from a planned P1.098 bil­lion or 6.3% this year.

This strat­egy is de­signed to cut un­em­ploy­ment rate to 3-5% by 2022 from 5.5% in 2016 and poverty in­ci­dence to 13-15% by 2022 from 21.6% in 2015.

In the same brief­ing, Mr. Dio­kno said the gov­ern­ment has enough funds to sup­port over­seas Filipino work­ers (OFWs) who flew home from Kuwait. Mr. Duterte on Fri­day asked OFWs in Kuwait to leave the coun­try “within 72 hours” af­ter the body of a Filip­ina maid was dis­cov­ered in a freezer at a house where she used to work. Mr. Dio­kno said fund­ing for liveli­hood as­sis­tance to re­turn­ing work­ers may be sourced from the bud­gets of the Depart­ment of La­bor and Em­ploy­ment, the Depart­ment of For­eign Af­fairs and the Depart­ment of So­cial Wel­fare and De­vel­op­ment.

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