In 2020, the Philippines was the 32nd largest economy in the world, it had the worst performing economy in Asia with its GDP contracting by 9.6%, and was the fourth worst performing economy among the world’s top 50 largest economies, next to Spain with -11%, Argentina with -10%, and the UK with -9.9%.
The prolonged lockdown by many governments around the world forced them to overstretch their spending, leading to high budget deficits (expenditures larger than revenues) in 2020. The high deficits to GDP ratios are expected to continue in 2021 and begin to taper off by 2022 and beyond, assuming there are no new large-scale lockdowns and closures of many businesses for whatever reason/s (see the table).
Many countries in the world are expected to have lower budget deficits in 2021 compared to their 2020 levels except the Philippines and a few other countries. Our -5.5% of GDP in 2020 is expected to rise to -7.4% this year.
10 REASONS TO LIFT THE LOCKDOWN
It is possible to lift the lockdown nationwide or at least move to the least restrictive Modified General Community Quarantine (MGCQ) starting May 1, for these reasons.
One, our economic contraction in 2020 was very deep, the deepest since the Philippines government started recording GDP data, and the deepest in Asia.
Two, the National Economic Development Authority (NEDA) estimated that foregone wages of workers come to about P19.6 billion per week under the strict Enhanced Community Quarantine (ECQ) and P14.7 billion per week under the next quarantine level Modified ECQ (MECQ). We cannot continue with this kind of jobs and income losses.
Three, indefinite business closures have soured the Philippines’ investment environment. The Philippine stock market remains the worst performing in Asia Pacific, with a year-to-date (ytd) contraction of -10.7% vs. Indonesia’s 0.6%, Thailand’s 7.2%, Singapore’s 12.3%, as of April 23.
Four, the sprouting of hundreds of community pantries nationwide, with voluntary food donations by private citizens with zero government funding for the poor means many Filipinos now are hungry and become poorer.
Five, there are existing prophylaxis (preventive) and early treatment drugs for homecare, outpatient care to avoid hospitalization. These include ivermectin which has many studies showing high efficacy and safety (see https://ivmmeta.com/), even the old hydroxychloroquine (see https://hcqmeta.com/), proxalutamide (https://c19colchicine.com/) and so on. The Concerned Doctors and Citizens of the Philippines (CDC PH) has medical protocols for prophylaxis, early treatment and late treatment for COVID-19 cases.
Six, the physical health of many people suffers with prolonged inactivity and staying at home with insufficient sunlight. See “Physical inactivity is associated with a higher risk for severe COVID-19 outcomes: a study in 48,440 adult patients,” https://bjsm.bmj.com/content/early/2021/04/07/bjsports-2021-104080.
Seven, many people are suffering from mental health issues because of the prolonged closure of schools and offices, the inability to casually communicate and see their officemates, classmates, and friends.
Eight, many of the restrictions imposed by the government have no scientific, no medical and clinical studies saying that they work: the lockdown and closure of many businesses, mandatory use of face shields, curfews, the prohibition of people below 18 years old from entering malls and restaurants, crossing provincial boundaries and checkpoints, and so on.
Nine, the economic burden of new or higher taxes, new or higher regulatory fees, fines and penalties, will be severe on the people. Government’s outstanding debt has increased significantly, from P8.22 trillion in 2019 to P10.25 trillion in 2020, and P10.40 trillion as of February this year.
Ten, the people’s Constitutional freedom of mobility, freedom to be economically productive, continue to be restricted if not outrightly prohibited by the government via these indefinite lockdowns. The people’s freedom cannot be hostaged indefinitely by indefinite lockdowns by the state.
Bienvenido S. Oplas, Jr. is the president of Minimal Government Thinkers