Quarantine reboot costs economy P300B

P10 billion in livelihood subsidy for micro entrepreneurs (formal and informal) would be a good start

A two-week implementation of the enhanced community quarantine (ECQ) and the slight adjustment lately to a modified ECQ (MECQ) had cost the economy P300 billion thus far, Trade Secretary Ramon Lopez said.

He stressed, however, that there’s a slight improvement in terms of reopening businesses during the MECQ thus reducing its deleterious effects.

“Based on an average improvement of around 30 percent in jobs and firms operating, in MECQ, compared to ECQ. While the rough estimate of GDP loss during MECQ can be around P120 billion,” Lopez told reporters.

And with lawmakers mulling to propose Bayanihan to Arise as One Act or the Bayanihan 3 to provide relief to Filipinos, especially the working class and the most vulnerable, Lopez said there should be subsidies provided to micro, small and medium enterprises.

“P10 billion in livelihood subsidy for micro entrepreneurs (formal and informal) would be a good start,” Lopez asserted.

He indicated the current P10 billion from the previous Bayanihan 2 have yet to be disbursed totally, as most MSME lenders are still scared or hesitant to avail the micro-financing loans being offered by the Department of Trade and Industy’s Small Business Corp. due to still persisting uncertainties brought by the pandemic.

More funds coming

“Out of P10 billion, the SB Corp had released P3.3 billion or merely 30 percent, distributed to 27,000 MSME borrowers. But we are inviting more applicants,” Lopez added.

Of the total fund, P6 billion is allotted for tourism-related businesses, Lopez said.

Despite this, Lopez revealed that many companies, especially when the ECQ and MECQ restrictions were re-imposed, have requested for some relief.

“We will be appealing to the Bangko Sentral ng Pilipas and the banks to provide some grace period especially this time in National Capital Region Plus. More importantly, we are requesting to the LGU with regard to the renewal of businesses, as some LGU at the start of year 2021, are basing their sales before pandemic or 2019. It should be based on the 2020 operation,” he added.