THE Marcos administration intends to prioritize the economic recovery; address the food crisis and fiscal concerns; and mobilize spending such as those intended for infrastructure, according to Socioeconomic Planning Secretary Arsenio M. Balisacan.
“Given the current conditions, we have to move fairly quickly and so it has been, from the very start, (upon proclamation), the economic team was built up, (to) get the transition happening quickly so Day 1 we would all hit the ground running. Obviously, (this is) because of so many urgent things that need to be addressed,” said Balisacan, who returned to his previous post as director general of the National Economic and Development Authority (Neda).
Balisacan, who is a known running enthusiast, said in a virtual interview with BusinessMirror that this sense of urgency was made clear by the President to the entire economic team.
Foremost in the agenda, Balisacan said, is the economic recovery. He said improving the country’s GDP growth also means being on track to sustaining this growth and this means recovering from the pandemic quickly.
One of the most serious wounds inflicted on the economy by the pandemic is due to education, he pointed out, as he stressed the need to address the losses in human capital development because the country’s long-term economic growth is at stake.
His predecessor, Karl Kendrick T. Chua, earlier said online classes could result in production losses of P11 trillion over a 40-year period. Chua said in a Senate hearing that only 37 percent of the learning is absorbed via online classes in the Philippines, lower than the 52 percent estimated in the United States.
“The need to fully recover is necessitated by the fact that the longer we linger, the more costly to the economy, to society. (This is) what I have been calling the economic and social scars created by the pandemic (that) were so deep and we would want to address that soon because otherwise that gets even aggravated,” Balisacan said.
“The cost may not necessarily be appreciated now but definitely down the road, 5 years, 10 years from now when these children who are missing the human capital development will join the labor force, would not be as efficient or competitive as our neighbor’s children. So the long-term growth potential of the economy will be very much affected and we don’t want that to happen,” he stressed.
Looming food crisis
Another primary directive to Balisacan and the economic team is to address the “looming food crisis” as well as the sharp increase in commodity prices, foremost of which are oil prices.
In order to address this, Balisacan said the government plans to provide assistance to the poor, despite the limited resources. This can be done through proper targeting which can be implemented through the National ID system.
Balisacan said the Marcos administration intends to ramp up the implementation of the National ID in order to create a better targeting system through which assistance will be given to those who need it the most.
By the end of April, some 10.5 million Filipinos or 33.7 percent of the target distribution had received their national IDs, according to the Philippine Statistics Authority (PSA). Based on the data, some 23.57 million PhilSys numbers have been generated as of May 5 and a total of 64.98 million have completed Step 2 as of May 4.
He said having a good targeting mechanism in place will prevent the issues raised by Filipinos when it came to the ayuda during the pandemic. Balisacan said during the lockdowns, the government provided ayuda to all Filipinos, regardless of income status and their ability to purchase basic necessities.
This, Balisacan noted, is “quite expensive” and added that a targeting system will be less costly and could reach more poor Filipinos through a digitized system such as the National ID.
“We think that we can do better with limited resources if we can target those resources efficiently and one way of doing that is to get our processes in government digitalized quickly and an important element of that would be the national ID system,” Balisacan said. “So that we can have a way of delivering the assistance to the poor with the least leakage possible, and [we] can cover more poor.”
Priority for near-end infra
On the spending side, Balisacan said the President wanted to prioritize Build, Build, Build projects that were nearing completion or already ongoing. He said these projects would receive priority funding from the government.
However, when it comes to projects that are still in the pipeline, these will be reviewed. Balisacan said these will be re-evaluated based on the projects’ ability to generate jobs, which is the focus of the administration in the medium term (Full story here: https://businessmirror.com.ph/2022/06/30/job-focused-economic-blueprint-of-new-government-seen-to-cut-poverty/).
Apart from job creation, Balisacan said, the projects will also be evaluated according to their perceived contribution to the country’s economic recovery; whether these are still viable; and how best to finance these projects.
Six years ago, the BBB initiative was launched by the Duterte administration to usher in the “golden age” of infrastructure in the country. Finance Undersecretary Mark Dennis Joven said in an earlier briefing that the initiative is the “biggest and boldest” investment of its kind by the government.
Joven said the total project cost of the BBB is P6.65 trillion and investment requirements of about P3.12 trillion. This has been undertaken not only to address the country’s infrastructure constraints but also lay the foundation so the Philippines can become an upper middle income country.
Based on data shared by Department of Public Works and Highways (DPWH) Undersecretary Emil K. Sadain there were seven projects that have been completed and another 11 that could be completed by mid-2022. Sadain said, another 12 projects will be completed by the end of 2022.
This means, the Duterte administration would have completed 18 of the 119 flagship projects contained in the current list. But, by the end of 2022, a total of 30 projects would have been completed.
Sadain said this will leave 89 projects to be undertaken from 2023 and onward. This, they said, would be a good starting point for the next administration.