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Philippines likely to struggle to recover from virus

MANILA, Philippines — The Philippines is among the countries in the Asia-Pacific region that will struggle to recover from the pandemic later this year, according to IHS Markit.

In its Week Ahead report, the market intelligence service firm said the coronavirus disease 2019 or COVID-19 pandemic is so far shaping up to be the “most severe economic shock” to the global economy and Asia-Pacific economies since the global financial crisis.

It noted that while some Asia-Pacific economies such as China, South Korea and Australia may lead the global recovery from the pandemic, the broader Asia-Pacific region will face tremendous negative economic shocks during 2020 from a global recession that will hit exports of commodities and manufactured goods as well as the global travel bans.

“With the global economy expected to gradually recover from the depths of the pandemic by late 2020 and during 2021, East Asia is likely to lead the recovery,” said IHS Markit.

“However, some populous Asian developing economies still face tremendous downside risks from the COVID-19 pandemic during 2020, including India, Indonesia and the Philippines, where new COVID-19 cases are still escalating.”

Confirmed COVID-19 cases in the Philippines have reached more than 4,400 over the weekend, with the number of deaths still outnumbering recoveries.

As such, the main island of Luzon, which generates 70 percent of the country’s economic output, will remain under an extended enhanced community quarantine until April 30.

The prolonged community quarantine stands to hit consumption, which is a bulk contributor to economic growth.

The government’s decision to extend the community quarantine by two more weeks, however, has so far been generally welcomed by both the public and private sector as this will buy the health sector time to boost its capacity for testing and isolation.

As Luzon braces for an extended enhanced community quarantine, a “modified lockdown” has been proposed by the National Economic and Development Authority (NEDA) to ensure smoother delivery of basic goods and allow some businesses to reopen and serve communities.

Socioeconomic Planning Secretary Ernesto Pernia said restrictions on the entry of cargoes of fresh produce and other agricultural goods from the provinces should be eased to support agricultural activity while the quarantine is in effect.

Businesses crucial to the manufacture of essential goods should also be allowed to resume operations to satisfy demand.

However, rules on social distancing should be clearly enforced and large companies are strongly urged to provide shuttle services to employees.

Source: https://www.philstar.com/business/2020/04/13/2006849/philippines-likely-struggle-recover-virus