Dominguez lists 5 priority measures to restart economy
To restart economy
Finance Secretary Carlos G. Dominguez III recommended five priority measures to stimulate domestic consumption and get the economy back on track at the soonest despite the coronavirus pandemic.
Among the priorities recommended by Dominguez is the accelerated implementation of the “Build, Build, Build” program, noting this is the “best driver of economic growth.” However, he also said it should comply with minimum health standards.
To reinvigorate consumer spending, Dominguez said the government should promote the manufacture of products that have “strong and inelastic demand,” notably by businesses involved in food production and logistics.
He also said the government should support the whole value chain of food production, including the establishment of food markets for efficient distribution — similar to the fruit and vegetable markets established decades ago in Japan — where farmers can directly sell their produce.
Completing Dominguez’s five-point program is his proposal on the mass hiring of contact tracers to boost the government’s efforts to stop the local transmission of COVID19,
while providing jobs.
The finance chief also calls on Congress to pass the Corporate Income Tax and Incentives Rationalization Act (CITIRA), which should now include “flexible tax and non-tax incentives” so that the government can better target specific investors that it wants to invest in the economy.
“We have to stimulate demand, and that's with ‘Build, Build, Build’ and push[ing] food production,” Dominguez said during the Monday night meeting of the Inter-Agency Task Force on the Management of Emerging Infectious Diseases (IATF) presided by President Duterte.
Dominguez pointed out that the infrastructure program “remains to be the best driver of economic growth because it has the best multiplier effects in terms of employment and shared prosperity.”
“The Duterte administration’s economic team and our legislators are finalizing an economic recovery program that will help us combat the pandemic and provide industries, especially micro, small, and medium enterprises (MSMEs),” Dominguez said.
But even before this economic recovery program is finalized, the government should take the lead in stimulating consumer demand to help businesses survive and keep the economy afloat, he pointed out.
Dominguez said it would be useless to provide relief to businesses if demand remains weak and consumers lack the means to buy their goods and services.
During the televised briefing, Dominguez asked the President’s support for the swift approval of the CITIRA bill, so that the Congress could pass it by June 3, or before the sine die adjournment of the Legislature.
The CITIRA bill was approved by the House of Representatives in September 2019, but remains pending in the Senate.
Enacting the CITIRA will attract foreign investors who want to relocate from other countries and are in search of resilient, highgrowth-potential economies like the Philippines, Dominguez said.
The mass hiring of contact tracers, meanwhile, will help offset the impact of the estimated 1.2 million to 1.5 million job losses resulting from the economic fallout triggered by the COVID-19 pandemic.
“We need to hire enough contact tracers to match the numbers we expect that will come with more testing,” Dominguez said.
Dominguez remained optimistic that the economy can get back on its positive growth trajectory, even though first-quarter growth contracted by 0.2 percent.
He said the Duterte administration must stay on course in continuing the bold reforms it has started to keep the economy resilient in the face of the global health emergency spawned by COVID-19.