Whither the Asean laggard?
THAT growth would either stall or contract in a pandemic regime is totally expected. Stalled economies and contracting economies are the universal wages of a pandemic, bludgeoning both developed and emerging economies, sparing no one, including closed- off Stalinist holdouts. A few countries, however, are hit brutally and hard, wasted to the core. Such is the tragic case of the Philippines in this pandemic regime. Just last year, the national mood was upbeat punctuated by chest-beating about the rosy future of “Asia’s fastestgrowing economy.” There was so much talk about the steady climb to a middleincome economy within the near future.
In a sad turn of events, the PhilipM pines will close out 2020 as the Asean region’s worst economic performer with a projected 8 percent to 9 percent drop in the country’s gross domestic product (GDP). The optimistic estiM mates that the GDP drop would not breach the 6-percent level, which has been the average and uninterrupted growth rate over the past several years, has been deemed both unrealistic and overoptimistic. A less-than 4 percent contraction, which was what the economic managers expected in their June projections, was based on an imaginary third quarter jump in ecoM nomic activities. And a fourth quarter return to near normalcy.
That the Philippine economy will experience the sharpest contraction in the Asean this year is one of the highlights of a regional assessment contained in the International MonM etary Fund’s (IMF) World Economic Outlook. The IMF said the PhilipM pine economy would contract by 8.3 percent this year, the sharpest drop in the Asean region. Some international banks and rating agencies had grimM mer forecasts on Philippine growth at a 9 percent or more contraction.
It was not merely coincidental that, as of mid-October, we have also the most number of Covid-19 cases in the Asean, with more infections than Indonesia with its more than 300 million people. The runaway coronavirus disease 2019 number is at the root of a crippled economy. The only Asean country expected to grow in 2020 is Vietnam and the outlier growth is driven by Vietnam’s early whole-ofnation approach to rein in the virus. While other countries, including the Philippines, often invoke “wholeof-nation” strategies to contain the resulting pandemic, it was Vietnam that vigorously complemented such talk with practice
So why are we in this mess, AseM an’s laggard economy with the most virus infections? How did we turn the triumphalism of 2019 into the horror show of 2020? The tragic thing is that no one with gravitas, either from the public or private sector, is asking this question. There is no recognition of the double whammy from the centers of power. There are standard-issue statements on the path to recovery but these official bloviations are clearly obliviM ous of the depth and seriousness of the mess we are in, on both the sick people and the ailing economy.
The broad strokes of a pandemic recovery program are supposed to be written in two official docuM ments. The urgent pieces of legislaM tion such as Bayanihan 1 and BayaM nihan 2, emergency laws to stop the bleeding. The year-round work toward recovery from the pandemic, ideally, should be the end-all and be-all of the 2021 national budget. A national budget tells the story of a country’s hopes and dreams, its priM orities, its goals and ambitions big and small, remember. In the ideal world, the path to recovery, the way out of the current slump and health crisis should be the dominant narraM tive of the national budget.
If you parse the national budget, both its broad strokes and minutiae, you will get the sinking feeling that the P4.5-trillion proposed budget for next year hardly recognizes the hole we are in and pandemic response is inadequate and spotty at best.
Look at this figure and you can see the 2021 national budget’s tortured priorities. A sum of P150 billion is proposed for flood control, one of the segments of the budget of the Department of Public Works and Highways (DPWH), the main infra agency. The proposed budget for the entire Department of Health is P130 billion. The grand total of the 2021 budget proposed for the DPWH is more than P600 billion.
There is no single virus- conM tainment project in that entire DPWH budget. Neither is there an infra project for virus control in the budget of the Department of Transportation, the other main infrastructure-centric agency.
If the universally accepted strategy toward normalcy is containment of the virus, why is the construction of roads, bridges, airports and seaports the obsessive focus of the 2021 naM tional budget? There is no science that says spending on infrastructure is the path to Covid-19 control and the return of life and economic activities to normalcy.
The country can only rebound economically, and this is not even rocket science once it puts the virus under control. The reopened busiM nesses and production facilities should be worry-free about turning out into petri dishes for virus infecM tions and spread. Without clarity on timelines for the vaccine’s availM ability, the national strategy should be virus control and containment adopted by countries that have sucM cessfully overcome the coronavirus.
We can’t wish our way out of the current slump, fear and uncertainty. Neither can we “Build, Build, Build” out of the current national anxieties and economic meltdown.
The pandemic is supposed to shake loose the old order and shatM ter paradigms. Instead we are stuck in untenable orthodoxies.