By Luz Wendy T. Noble

A MONTH-LONG lockdown ordered by President Rodrigo R. Duterte in Manila, the capital and surrounding cities could slow overall growth as a region-wide quarantine affects logistics and supply chains, according to analysts.

“This could lead to some slowdown in economic activities and economic growth in the country, especially in Metro Manila,” Michael L. Ricafort, chief economist at Rizal Commercial Banking Corp. said in an e-mailed reply to questions.

Mr. Duterte on Thursday night ordered a one-month halt to land, domestic air and sea travels to and from Metro Manila as part of government efforts to contain a novel coronavirus outbreak that has infected at least 52 people in the Philippines.

Mr. Duterte also suspended work in the Executive branch for a month from March 15, and extended class suspensions at all levels until April 12. Companies should allow work-from-home and other flexible arrangements to prevent the spread of the virus, he said.

Manufacturing, retail and service establishments should continue operating, he said.

The President made the announcement in a televised speech after meeting with an inter-agency task force against the contagion that has killed more than 4,600 people and sickened about 126,000 more worldwide, mostly in China.

Metro Manila contributed about 38% to the country’s gross domestic product (GDP) in 2017, UnionBank of the Philippines Inc. Chief Economist Ruben Carlo O. Asuncion said, citing Philippine Statistics Authority data.

“This will definitely slow down businesses and the impact on the economy may be significant,” he said in an e-mail.

Socioeconomic Planning Undersecretary Rosemarie G. Edillon said this week they were looking at a 5.5-6.5% GDP growth this year because of the outbreak.The government had targeted growth of 6.5-7.5%.

Gareth Leather, an economist at Capital Economics said that the quarantine details look “less draconian” compared with what had been enforced in China’s Wuhan City — where the coronavirus disease 2019 (COVID-19) was first detected — and the rest of China.

“Manufacturing and retail establishments will remain open, public transport will be operational, and people will still be allowed to enter the city for work,” he pointed out.

“As such, many industries, including the important business process outsourcing (BPO) sector should be able to function broadly as normal,” he added.

Mr. Leather said the restrictions could slow consumption, which fuels about 70% of the country’s economy.

“The move is likely to further dent economic sentiment,” he said. “Consumption, which accounts for around 70% of the economy, will take a hit as people avoid public places,” he said in a note late Thursday.

As people avoid public places, consumers might turn online for their needs, according to De La Salle University economist Mitzie Irene P. Conchada.

“Most people would likely resort to online shopping or purchase food there,” she said in an e-mail. “Third-party providers such as Grab Food will be widely availed of.”

Robert Dan J. Roces, chief economist at Security Bank Corp. said consumers need to be assured to stop them from panic buying and keep prices stable.

“Once consumers are assured that regular supply of goods are still there and that prices are stable, then we expect a smaller negative net effect,” he said in an e-mail.

The lockdown could also affect investor sentiment and foreign direct investments (FDI), Mr. Ricafort said.

“FDIs could also be reduced due to a more uncertain global economic environment largely brought about by the coronavirus concerns,” he said.

Mr. Duterte earlier said the alert level had been raised to code red sublevel 2, which means there have been community transmissions and increased infection cases beyond the government’s responding capacity.

Mass gatherings are prohibited, while the entire Metro Manila must undergo community quarantines.

Mr. Duterte said local governments outside the metro must undergo village, city and provincial quarantines when there are at least two novel coronavirus cases from two different households, villages and cities, respectively.

Mass public transport including the Light Rail Transit, Metro Rail Transit and Philippine National Railways would continue, the president said. The Transportation department will issue guidelines on social distancing, he added.