‘PH RECOVERY TO START ONLY AFTER MAY 2022’
The consumption driven Philippine economy may only benefit from eased quarantine lockdowns and begin its recovery in May next year because of the pace of its inoculation program.
According to Chua Hak Bin, Lee Ju Ye and Linda Liu, economic analysts for Malaysian financial giant Maybank,
Singapore was expected to achieve herd immunity—70 to 80 percent of the population fully vaccinated—by next month while Malaysia may follow in October.
In their report, titled “Asean Economics: Divergent Recoveries,” the analysts said on Friday that the Philippines and Thailand would follow suit by May 2022 if they maintain their current vaccination rates.
The Maybank report noted that 14.8 percent of the targeted adult Filipino population already received at least one vaccine dose, while 11.8 percent were fully vaccinated as of Aug. 18.
On the other hand, Indonesia
and Vietnam would be at the tailend in the region as they were projected to respectively reach herd immunity by July and August 2022, the analysts asid.
But across Southeast Asia, “delays in vaccine deliveries
could jeopardize these timelines,” Maybank said.
Moreover, the spread of the more contagious Delta variant may make herd immunity an “elusive target” and “a permanent reopening may not be possible at 70-percent vaccination rate, if fatalities and hospitalizations remain high,” Maybank said.
But once stringent quarantine restrictions end, Maybank expects the economies of the Philippines and Indonesia to benefit the most in the region.
Tougher for PH
“Both Indonesia and the Philippines have large domestic economies and a more permanent easing of lockdowns in 2022 will boost domestic demand and services.”
But the road to economic recovery may be tougher for the Philippines as Maybank estimated that the government reduced its fiscal support to fight the pandemic and next year’s budget amounted to only 1.6 percent of gross domestic product (GDP)— the lowest in the region.
Including indirect fiscal measures, Maybank pegged the Philippines’ COVID-19 war chest at P819.7 billion, or 4.2 percent of GDP, still the smallest in the region when measured against the size of the economy.