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Why our leaders fail to learn pandemic lessons

By Clara Ferreira Marques

IT’S THE WORST EPIDEMIC of our times, a health emergency that has now left more than 420,000 infected, 18,800 dead and paralyzed the global economy. The scale has been clear for weeks. All the more baffling, therefore, to watch poor decisions being repeated, over and over again.

From Italy to the US and Britain, each government first believes its country to be less exposed than it is, overestimates its ability to control the situation, ignores the real-time experience of others and ultimately scrambles to take measures.

Prime Minister Boris Johnson has now closed schools and imposed a lockdown to limit the lethality of the coronavirus in Britain. It’s a sharp course correction for a man who, less than a month ago, said he was shaking hands in a hospital and spoke of business as usual, while Italy was pulling down the shutters.

He’s not alone. With populism in the ascendant, leaders from US President Donald Trump to Indonesia’s Joko Widodo have worried about immediate political concerns first, rather than the impending pandemic. Countries that have successfully learned from others and from past experience, say, Taiwan, are far outnumbered by those apparently incapable of taking lessons even from near-neighbors.

It’s not as simple as poor governance. The shortcuts that humans use to make decisions in a crisis underlie how hard it is to adapt policy to fast-changing circumstances.

At the most basic level, the explanation is simple: We make decisions based on past experience and recognized patterns. Countries that have done best at containing the virus so far have the experience of dealing with previous outbreaks. That includes Hong Kong and Singapore in the case of severe acute respiratory syndrome, or SARS; and South Korea with Middle East respiratory syndrome, or MERS.

For governments outside Asia, the same error of decision-making, or cognitive bias, has been less helpful. For them, SARS was a disease that they could see was devastating but also less contagious, confined to a different region and over within months. They also think of flu. That’s easily transmitted, but much less lethal. Their experiences suggested drastic early action was unnecessary.

Compounding this is that superficial differences blind us to the fact that an experience elsewhere could be useful for policy at home, points out Nick Chater, professor of behavioral science at Warwick Business School. In the current outbreak, China was seen as too dissimilar — politically, socially, even ethnically — for the virus to be quickly considered a coming problem that might merit a response.

Italy, the first Western country to be floored by the illness, initially resisted wide-ranging closures. In late February, as town-level lockdowns were beginning, one party leader urged people to go out for drinks, coffee, or pizza: “Let’s not lose our customs.” He later contracted the virus.

This held even as the situation worsened across Europe. France was edging toward a Paris lockdown, eventually announced March 16, but across the channel, Britain still held horse races and music concerts, sticking to a policy of so-called herd immunity that requires the majority of people to get infected and recover. It took an Imperial College report, laying bare the human cost, to change minds at the top. The scramble to prepare backup plans for UK schools and other services suggests it was never considered a real possibility — until it was.

The failure of empathy doesn’t happen at just cabinet level. When I spoke from my home in Hong Kong to relatives in Europe a few weeks ago, they struggled to comprehend that what was hitting us in Asia could reach them and change their daily lives. It did. Writ large, that has dramatic consequences, not least the waste of months when tests and protective equipment could have been prepared. Entire policy options are off the table because the epidemic has spread too far.

Narratives that build on national exceptionalism don’t help, clouding the response of even Southeast Asian countries to the experiences of neighbors. Populist tendencies that encourage confirmation bias and our preference for omission discourages decisions that may have painful outcomes today — even if not doing anything produces a worse result. Populists, after all, don’t want to be unpopular. That partly explains the tendency of Trump, President Jair Bolsonaro of Brazil and others to downplay the threat. Bolsonaro continues to compare the virus to “a little cold.”

It makes little sense to worry about a temporary downturn when the worst-case could involve permanently wiping out a significant portion of your population. That makes basic distancing measures, in the words of St. Louis Federal Reserve President James Bullard, an investment in survival. But it’s tough to act out of proportion with what people see in front of them compared to what they might be dealing with tomorrow.

There’s another unhelpful proclivity, explains Donald Low, professor of practice in public policy at Hong Kong University of Science and Technology: an optimism bias that leads to myopia in times of crisis. This is especially true for the usually successful governments of wealthy nations, rarely presented with debacles on this scale. Often, there is an illusion of control.

Humans don’t like to change their minds. Consider the rabbit-duck illusion, used by psychologist Joseph Jastrow and cited by Chater in a recent article. Once I see a duck in the image, I can’t see a rabbit, and I won’t see both. In a pandemic, this can be very bad news, especially if supranational organizations that should foster wider thinking are largely absent.

There are glimmers of hope. Local authorities and companies have been nimble in places like Brazil and the US, apparently able to switch from rabbit to duck. More policy makers will need to set in place the defenses, with better advice and transparency, to ensure they do the same.

BLOOMBERG OPINION

Adjustments set for PHL Olympic push after Games postponement

By Michael Angelo S. Murillo
Senior Reporter

PREPARATIONS of the Philippines for the Tokyo Games will continue albeit set for adjustments after the quadrennial sporting spectacle was officially pushed back by a year this week as the world continues to grapple with combating the coronavirus disease 2019 (COVID-19) pandemic.

Originally set for July 24 to Aug. 9 this year, the Olympics is now targeted to take place no later than the summer of 2021 as agreed upon in a conference call between International Olympic Committee (IOC) president Thomas Bach and Japanese Prime Minister Shinzo Abe on Tuesday.

The agreement was arrived at after carefully considering the cloud of uncertainty brought about by COVID-19, which has infected more than 400,000 people worldwide to date and forced the sporting world to a standstill, coupled with mounting pressure from stakeholders not to push through with the event.

It was a decision that Philippine sports officials support and in favor of, underscoring the safety and health of everyone in sports is primary at this point.

With the postponement, local sports executives said adjustments are due in the country’s Olympic push but the mission of sending as many capable athletes as possible remains.

For Mariano Araneta, Philippine chef de mission to the Tokyo Games and president of the Philippine Football Federation, among those on deck for them on the heels of the Olympic postponement is making a thorough assessment of where the country’s push is at right now.

“With the postponement, we will wait for the NSAs’ (National Sports Associations) direction on how they will prepare their athletes for qualifiers on the case of those that have not qualified yet [and see what still can be done]. For those that have qualified, we will also ask for their new training preparations. Meantime, we ask the athletes to stay safe and healthy,” said Mr. Araneta in a text message.

At the time the 2020 Olympics was postponed, four Filipino athletes had already qualified, namely EJ Obiena (athletics/pole vault), Carlos Yulo (gymnastics), Eumir Marcial and Irish Magno (boxing).

More athletes were expected to join the four from sports like boxing, canoe-kayak, golf, skateboarding, judo, wrestling, archery, cycling, weightlifting, table tennis, athletics, and wrestling as they were in the mix in their respective qualifiers which were also put on hold because of COVID-19.

In the lead-up, confidence was high that 2020 could be the year that the Philippines finally win its first-ever gold medal in the Olympics, owing to having better-prepared athletes and jacked-up support given to them.

FAVORABLE
While a regretful turn of events, a postponement was far better than having the event cancelled altogether and the Philippines actually could use it in its favor, said Philippine Olympic Committee (POC) president Abraham Tolentino.

“It’s better to postpone the Tokyo 2020 Olympics rather than cancelation so as not to lose our chance for our first gold medal — or even more golds. [With the postponement] More Filipinos have a chance to qualify,” said Mr. Tolentino.

“A postponement would mean more time to train for those who have already qualified and for those who are still trying to qualify. A 2021 schedule is ideal enough,” he added.

Budget in the training and preparation of the athletes, too, will have to be addressed, something officials said they are ready to do, with Philippine Sports Commission chairman William Ramirez saying “Implications on the budget will remain manageable.”

Filipino athletes, for their part, expressed sadness with the Olympic Games being pushed back but respect the decision and believe it is the right direction to take. They also vow to continue their push.

“God’s time! Road to whenever it will be #tokyo2020 #tokyo2021,” Mr. Obiena wrote on a Facebook post when he heard of news of the Games postponement.

Mr. Obiena, 24, is making his Olympic debut in Tokyo.

The Alliance of Boxing Associations of the Philippines (ABAP) also expressed its readiness to adjust and prepare its athletes for the Olympics, hoping more boxers would join Mr. Marcial and Ms. Magno.

Team Lakay fighter Lito Adiwang rising above adversities

HAD HIS FAIR SHARE of adversities while growing up, ONE Championship fighter Lito “Thunder Kid” Adiwang said it only made him a better individual and something he is now taking cue from as he builds a solid career in mixed martial arts.

Growing up in Baguio City, 26-year-old Adiwang said life was not easy for him.

But instead of having hardships consume him, he chose to use it as motivation to improve his lot and make something out of his life.

“I was born the youngest in a family of seven children. Life was tough and we had to get through a lot of trials. My parents used to plant crops in an open lot so we would have food to eat, but it wasn’t enough,” Mr. Adiwang said.

“It really taught me a lot about overcoming adversity in life. I wanted to help my family, but I felt powerless. Then I lost my fourth sibling in a mining accident. My parents separated when I was a teenager. I just felt hopeless,” he added.

To help him take on the challenge that life had thrown at him head-on, Mr. Adiwang said he drew inspiration from other people who started with nothing but steadily improved their lives through good old hard work and determination.

One such person is Filipino boxing legend and now-Senator Manny “Pacman” Pacquiao.

“Growing up watching the rise of Manny Pacquiao, I was motivated to become a boxer just like him. I wanted to represent my country and make my people proud, too. I wanted to help bring my family out of hardship and poverty,” said Mr. Adiwang.

“There used to be an old church on the streets where I grew up, where I initially started to learn how to box. I was 12 years old at the time. I would shadowbox and imagine I was Manny Pacquiao, fighting against legends like Erik Morales and Marco Antonio Barrera. I loved his relentless style. His opponents couldn’t handle him,” he furthered.

The grit and determination he got from watching Mr. Pacquiao are serving as a motor for Mr. Adiwang as he makes a name for himself in the strawweight division of ONE Championship.

Following his winning at the ONE Warrior Series last year which earned for him a contract in the main draw of the promotion, Mr. Adiwang has steadily climbed the ranks, winning his first two matches with the “big boys” of ONE.

He first defeated Japanese veteran Senzo Ikeda by TKO in October last year before winning by submission over Thai Ponsiri Mitsatit in January.

With the twin wins, Mr. Adiwang improved his MMA record to 11-2.

The Filipino fighter said he is just scratching the surface and he is ready to deal with the challenges that lie ahead in his career to reach the position where he wants to be.

“Right now I’m just focused on being the best that I can be. I really want to prove myself against the best opponents, and I feel I am ready.”

ONE Championship is currently at a pause like many sporting events in the world as the coronavirus disease pandemic rages on.

It hopes to begin staging live events behind closed doors in April and with audience late in May here in Manila. — Michael Angelo S. Murillo

IOC working with sports bodies for rescheduled Tokyo Olympics

TOKYO — The International Olympic Committee (IOC) is working with sports bodies to arrange a July–August window for the postponed Tokyo Olympics in 2021 and hopes to confirm the schedule within a month, Japan’s Yomiuri newspaper reported on Thursday.

John Coates, the IOC’s Coordination Commission chief for Tokyo, told the Yomiuri the Games would have to be held between the tennis Grand Slams of Wimbledon, slated to end in mid-July, and the US Open, which starts in late August.

“We want to more or less finalize the dates in four weeks’ time,” the paper quoted Coates as saying.

Mr. Coates, who is also president of the Australian Olympic Committee (AOC), said the summer scheduling would be dependent on avoiding clashes with the world championships for swimming (July 16–Aug. 1) and athletics (Aug. 6–15).

World Athletics boss Sebastian Coe has said the world athletics championships in Eugene, Oregon, could be moved back to 2022 if necessary.

Mr. Coates told the newspaper the hope was to follow the same arrangements next year that had been planned for 2020, including holding the marathon in the northern city of Sapporo instead of Tokyo to escape the heat.

The AOC confirmed the Yomiuri report’s veracity and also told Reuters in a statement that Mr. Coates had “proffered a view but confirms a range of options are on the table for the IOC.”

The IOC and Japanese government succumbed to intense pressure from athletes and sporting bodies around the world on Tuesday, agreeing to push back the Games by as much as a year because of the coronavirus pandemic.

IOC President Thomas Bach said on Wednesday that “all options” were on the table for rescheduling, including holding the Games before the Japanese summer.  — Reuters

Legendary UAAP coach Aric del Rosario passes away

THE local basketball community is mourning the passing of legendary University Athletic Association of the Philippines basketball coach Januario “Aric” del Rosario who suffered cardiac arrest on Wednesday. He was 80 years old.

A native of Candaba, Pampanga, Mr. Del Rosario was a winner at every level of basketball he coached in.

He steered the University of Santo Tomas men’s basketball team to four straight UAAP titles from 1993 to 1996. His 1993 team, which boasted of the likes of eventual pros Dennis Espino, Rey Evangelista and Patrick Fran, swept the competition on its way to being crowned as automatic champion.

While at it, he was also a valuable part of the Alaska franchise in the Philippine Basketball Association, serving as one of the assistants of Tim Cone during their memorable run in the 1990s, including winning a grand slam in 1996.

In 1998, Mr. Del Rosario coached the Pampanga Dragons to the inaugural Metropolitan Basketball Association title.

Mr. Del Rosario, himself a former UST star player, served as coach of the national team that won gold in the Southeast Asian Games in 2003.

He went back to coaching in college late in his career, taking the reins at the University of Perpetual Help in the National Collegiate Athletic Association and leading the team to three Final Four appearances (2012-14) in the four years he was there.

Mr. Del Rosario was also part of the Maharlika Pilipinas Basketball League (MPBL) with the Paranaque Patriots.

When news of his death broke out, former colleagues and players of his gave their tributes, underscoring his brilliant basketball mind and the good person he was.

They lament not being able to pay their respects to Mr. Del Rosario because of the ongoing lockdown in Luzon because of the coronavirus disease 2019 (COVID-19) but offered their prayers to the late coach and his grieving family.

Mr. Del Rosario is survived by his five children and nine grandchildren. — Michael Angelo S. Murillo

NBA could be back by May — Mavs’ Cuban

DALLAS MAVERICKS owner Mark Cuban said he’s hopeful the National Basketball Association can resume playing games on TV, without crowds, by May.

“America needs sports right now. We need something to cheer for. We need something to get excited about. We need a team to root for, and I think the NBA can fill that need,” he told Neil Cavuto of FOX Business on Wednesday.

The NBA has indefinitely suspended its regular season amid the current pandemic, and at least 10 active players have tested positive for the coronavirus.

Mr. Cuban told the Dallas Morning News he thinks the NBA will be the first professional league in the US to bounce back.

“I’m proud of the NBA and the way we’ve reacted,” he said. “We’ve led the way and hopefully will lead the way out of this. No one has perfect information right now, so all decisions are tough, but if I had to guess based off the people I’ve talked to at the CDC and other places, I would say that the over-under [for the league’s return] would be June 1 and I’m taking the under.

“… Hopefully by the middle of May we’re starting to get back to normal and the NBA is playing games, maybe not with fans, but we’re playing games.”

Meanwhile, Detroit Pistons forward Christian Wood is healthy after a bout with the coronavirus, his agent said Wednesday.

Adam Pensack told the Detroit Free Press that Wood is “feeling great and fully recovered.”

Wood’s positive test for COVID-19 was reported on March 14.

There are 10 confirmed positive tests for COVID-19 among NBA players, but only five of those players have been identified: Wood, Rudy Gobert, Brooklyn Nets star Kevin Durant, Utah All-Star Donovan Mitchell and the Boston Celtics’ Marcus Smart. — Reuters

QB free agency

To argue that the National Football League has been having a bizarre offseason would be to understate the obvious, and not simply because of the continued threat of the new coronavirus pandemic. For the first time in a long, long while, quarterbacks aren’t in demand. Erstwhile Patriot Tom Brady was a target of suitors, certainly, and for more reasons than 20 years’ worth of achievements show. For others who have had significant burn under center, however, the free-agent market doesn’t seem to be inviting at all. Even as unease and accompanying movement have historically been tied to the most important position relative to success, 2020 appears to be setting itself up as an outlier.

Fit is crucial, to be sure. Even Brady found his options curtailed in this regard; he was keen on touching base with the Niners and Titans after he bid the Patriots farewell, but their interest, iffy at best to begin with, was further stunted by their comfort level with resident stars Jimmy Garoppolo and Ryan Tannehill. That said, others still on the lookout for landing spots didn’t figure their employment opportunities to be slim to none. Which isn’t to say they’re not wanted. They may, but on conditions they would be hard-pressed to accept: as backup, or with few guarantees, or both.

In the case of former league Most Valuable Player Cam Newton, the questions start with his capacity to keep taking a beating on the field. Parenthetically, even the Panthers had worries, going so far as to look for trade partners during the season, and then just releasing him after finding no takers. And while his former employers did give him a clean bill of health, the inability to check him out firsthand given community quarantine protocols coupled with the dearth of starting positions and his likely asking price scared potential suitors away.

Super Bowl XLVII MVP Joe Flacco has it worse, released by the Broncos with a “failed physical” designation and thereby forced to accept the plan to keep playing at age 35 as more of a pipe dream. And then there is Jameis Winston, fresh off a campaign in which he passed for a whopping 5,109 yards and 33 touchdowns. With Brady waiting in the wings, the Buccaneers had ample cause to lead him and his predilection for interceptions to the exit. Seeing no one so much as pass by his doorstep is, however, another matter altogether.

For the unexpected castoffs, there is no recourse but to keep plodding on and hope for the best. They have talent and experience. All they lack is opportunity, and they know they would do well to believe it will come, and be prepared when it does.

 

Anthony L. Cuaycong has been writing Courtside since BusinessWorld introduced a Sports section in 1994.

alcuaycong@bworldonline.com

UP students win competition for generating electricity from water vapor

Patrick Parone and Hannah Ramos, BS Mechanical Engineering students of University of the Philippines Diliman, were hailed as Country Champions in the recently concluded Philippine finals of Schneider Electric’s Go Green 2020. Their winning project is a portable water purifier designed to generate electricity through water evaporation. Dubbed Kislap, it is inspired by the current living situations of Filipinos in rural areas.

Go Green is a global competition organized by Schneider Electric (SE) – an energy and automation digital solutions provider – to empower students to come up with solutions that will shape the future of the energy industry.

Patrick Parone and Hannah Ramos’s Team Scintillans bagged the coveted award, besting 352 hopefuls nationwide in the process.

“Every day, there is always a challenge to shift into more sustainable energy sources to mitigate, if not eliminate, some of the global problems,” said Parone. “We thought of a source that is ubiquitous yet untapped—water evaporation. If we could find a way to harness that energy, it could be a major step towards sustainability, especially since the majority of Earth is composed of water.”

“With our idea, Filipinos living in rural areas can turn their water collected from deep wells, rivers, and rain safe to drink with the sun’s energy during the day and can act as the community’s source of light during the night,” Hannah Ramos said.

The passion to make a difference

Ruth Kharen Ramayla, Schneider Electric’s Industrial Automation Director, led the panel of this year’s judges and acknowledged the relevance of Team Scintillans’s project.

“Schneider Electric, through Go Green, has always been on the lookout for the next bold ideas from our students,” she said. “What sets the winners apart is the passion to make a difference, and I see that in Team Scintillians’s Kislap. It is grounded on a plight many Filipinos have, and I am excited not only for Patrick and Hannah, who showed smarts and resourcefulness, but for the future beneficiaries of the project.”

The winners, along with the ten other finalists, were mentored prior to the finals by coaches from SE Philippines, headed by country president Alexandre Vermot.

“Filipinos are naturally resourceful, and Filipino students are no exceptions,” Vermot said. “With the existing social and environmental challenges, it is empowering to see how the youth can draw inspiration from these circumstances and rise above them through ingenious solutions.”

Parone and Ramos will represent the Philippines in the regional finals, to be held virtually, where they will be up against student delegates across Asia-Pacific on April 16, 2020.

Eastern Communications on why cloud computing is key to business continuity

The emergence of cloud service in the digital era is developing at an incredible pace. Locally, cloud computing is expected to take account for 13% of Philippine IT services market by 2020 driven by government agencies and SMEs according to BMI Research report. Businesses have started adopting cloud service which productively improves their operations and, soon, other companies will follow suit.

With the evolving workplace environment, cloud proves to be an ideal solution for every enterprise. Eastern Communications, one of the premier telecommunications companies in the country, lists down reasons why cloud can be an asset for your business’ continuity and growth.

Work flexibility

Cloud storage allows users to store files in such a way where members of an organization could access it anytime and anywhere. This offers significant help especially now that companies have started implementing a skeletal workforce or work from home arrangements for their employees due to the threat of Covid-19.

Businesses can continue doing their tasks from any location and conveniently access necessary data as long as an internet connection is available. Cloud allows employees to manage their workflows better with easier communication and team collaboration while accessing data from a central location. This can prevent organizations from halting operations even in challenging situations such as work suspension and calamity.

Cost efficiency

Simply put, businesses save huge amounts of money by investing in cloud storage services. The purchase cost ensures maximum utilization of budget on the needed software features of the business. Overhead is the responsibility of the service provider. This big cut on overhead expenses could be used instead for business expansion.

Secured data backup

Official work files contain a lot of essential information. From images to documents, spreadsheets, and presentations, it is necessary for businesses to keep a secure copy and backup of these files. It is not advisable for businesses to depend solely on external servers and drives or on printed documents for data storage since these are prone to data corruption. By storing data in the cloud, businesses are guaranteed file safety and data loss are no longer a concern even during uncontrolled environmental hazards such as natural calamities or accidents. Data will be saved safely in the cloud.

Data Protection

Through a virtual environment, cloud services provide protection in the event of primary operations failure. It does not only store data but also protects it from untoward situations. Cloud services offer ease of mind so businesses would not have to worry about permanent loss of critical data, like what Eastern Cloud-based Disaster Recovery provides.

Increased productivity

Cloud storage frees up spaces from resources such as desktops and servers. Having a clean, uncluttered, and well-organized workplace helps reduce waste while optimizing productivity. It is also useful for employees who work from home as necessary files would be accessible at the comfort of their home, making them as productive as they are when in office.

With the fast-changing business environment, cloud services make it easier for companies to access data and information more efficiently. It is also important to choose the right service provider for a reliable and satisfactory cloud experience for your business. Eastern Cloud is one of Eastern Communications’ latest ICT solutions offering world-class methods of storing and sharing company data and applications securely over the Internet, hence advancing overall business performance.

Nationwide round-up

Test kits from Singapore

SINGAPORE EMBASSY IN MANILA

SINGAPORE Ambassador to the Philippines Gerard Ho checks boxes containing COVID-19 test kits that arrived at the Ninoy Aquino International Airport on March 24, before turning these over on the same day to the Philippine government through Foreign Affairs Secretary Secretary Teodoro L. Locsin, Jr. Singapore donated 3,000 test kits and one Polymerase Chain Reaction Machine.

Law gives Duterte emergency powers for 3 months

PRESIDENT Rodrigo R. Duterte signed into law on Tuesday Republic Act No. 11469, or the “Bayanihan to Heal as One Act,” which gives him emergency powers in managing the coronavirus disease 2019 (COVID-19) in the country. The law is valid for three months. During a late night briefing on Tuesday, Mr. Duterte said, “To the members of both houses of Congress who sponsored and voted for this measure, I express my sincerest gratitude to all of you for granting our most urgent requests. Finally, the Executive Department can move, decide and act freely for the best interest of the Filipino people during this health crisis.” Among the law’s provisions are the immediate testing of persons under investigation and monitoring of the disease, and mandating establishments to serve as quarantine sites or housing for frontliners such as health workers. The procurement of personal protective equipment and other medical supplies will also be expedited and exempt from taxes and other fees. Families from low-income households will be provided subsidies and other assistance. — Gillian M. Cortez

Agri workers, fisherfolk, vets exempted from quarantine

AGRICULTURE workers and veterinarians have been included in the list of exemptions from the mandatory home quarantine imposed by the government in Luzon to contain the spread of the coronavirus disease 2019 (COVID-19), a ranking police official said Wednesday. Lt. Gen. Guillermo Lorenzo Eleazar, Philippine National Police (PNP) deputy chief for operations, said among those allowed to travel within the quarantine areas are farmers, fishermen and employees of agricultural supply stores and outlets. Mr. Eleazar, who heads the joint task force COVID-19 Shield, said the policy adjustment is to ensure steady food supply in Luzon. Aside from agricultural workers, veterinarians and employees of veterinary clinics have also been included. The agriculture industry group Samahang Industriya ng Agrikultura (SINAG) and the People for the Ethical Treatment of Animals (PETA) have appealed for the inclusion of their sector as essential personnel under the current state of emergency. — Emmanuel Tupas/PHILSTAR and Revin Mikhael D. Ochave

PMA rejects automatic licensing of medical graduates

THE PHILIPPINE Medical Association (PMA) rejected the proposal to automatically issue licenses to medical graduates without taking the board exam to beef up manpower amid the spread of the coronavirus disease 2019 (COVID-19). PMA Vice President Benito P. Atienza, in a radio interview Wednesday, said medical students can still volunteer to help even without a license. The proposal came from Senator Francis N. Tolentino who, in a statement Monday, asked the Professional Regulation Commission to waive the licensure examination of new physicians, which has been postponed from its March 1 schedule with more than 1,500 graduates registered to take it. — Genshen L. Espedido

Government eyes up to $2-billion loan

THE COUNTRY is looking to borrow up to $2 billion from multilateral lenders to support increased spending to stem the impact of the coronavirus disease 2019 (COVID-19), the Finance chief said, adding the government’s fiscal position is sound and can accommodate larger debt to plug its budget deficit.

“We are currently in negotiations with multilateral agencies for $1 billion up to $2 billion for funding support for this. We have to realize, we are looking at a drop in revenues. So we have to cover that gap somehow so that we maintain our pace of spending,” Finance Secretary Carlos G. Dominguez III told reporters via Google Meet on Wednesday, adding slower economic activity and business disruptions, largely caused by the month-long lockdown in Luzon, will hurt the government’s tax take.

He said the Finance department is looking to tap multilateral lenders for grants and loans to provide the needed funding, including the World Bank, Asian Development Bank and Asian Infrastructure Investment Bank.

“We are continuously working online with them. I believe that they see the immediate need and are also working fast. We want to do it early because all the countries in the world are trying to do the same thing,” he added.

Mr. Dominguez said the government is in a “very good position” fiscal-wise to support the economy versus the impact of COVID-19, with the national budget in place and a historically low debt level of 41.5% of gross domestic product (GDP) last year.

“As you know, we have reduced our debt levels from over 70% of GDP to only 41% of GDP now. So we are in a very good position to combat this coronavirus and we have the debt capacity to do that,” Mr. Dominguez said in a Bloomberg TV interview.

In a separate interview, Mr. Dominguez did not say how much additional debt the government can accommodate this year, but assured that “we are willing to do as much as it takes” to aid Filipinos who lost their livelihood, “protect frontliners,” and support the entire economy.

Citing preliminary estimates by the Development Budget Coordination Committee, Mr. Dominguez said they are looking at a P318.9-billion drop in revenues if 2020 GDP will contract by one percent and a P286.4-billion decline if the economy will post flat growth. This is on top of an estimated P14-billion drop in revenues due to easing demand and falling global oil prices.

The government is also projecting P145 billion in delayed tax payments after the deadline for filing of income tax returns was extended by one month to May 15.

“Because our revenue is down, we will have to borrow to cover that. That is our primary task. When I said we will do what is required, we will do what is required within the budget and move things around that’s why we asked for that (emergency) power. Once we see the extent of the damage to the economy, we will determine how much budget we will need if any,” he said.

The World Bank has committed to provide $100-million loan to the Philippines while the Asian Development Bank has already extended a $3-million grant.

Mr. Dominguez said even though higher borrowings may be credit negative for the country, the plan to secure an “A” level credit rating by 2022 is “still there.”

The government has rolled out an initial P27.1-billion economic stimulus package to help virus-affected sectors.

President Rodrigo R. Duterte signed late Tuesday Republic Act No. 11469 or the Bayanihan to Heal as One Act which will allow him to realign or reallocate as much as P275 billion in national budget and off-budget outlays to the government’s emergency subsidy program to provide relief to some 18 million Filipino households most affected by the pandemic and for the treatment of infected persons.

The government targets to collect P3.49 trillion this year to fund its P4.1-trillion spending plan, with the remaining funds to be sourced from its borrowing activities.

‘FISCAL CRISIS’
Socioeconomic Planning Secretary Ernesto M. Pernia on Wednesday warned a wider budget deficit that could lead to a repeat of the “deep fiscal crisis” in 2004 when the country reached a debt level of around 75% of GDP.

The National Economic and Development Authority (NEDA) estimates that the budget deficit could widen to 4.4% to 5.4% of GDP this year amid an increase in government spending, well beyond the 3.2% cap, which economic planners have yet to revise.

Itong nangyayari ngayon na marami ang expenses ng government (As the government ramps up spending), on one hand, on the other, kokonti lang ang revenue (revenues are falling), aabot ’yung deficit natin to (our deficit could reach) 4.4-5.4% ng GDP which is really a danger zone, red flag na ’yun eh. Beyond 3.5% of GDP is already a red flag,” Mr. Pernia said in a radio interview.

The NEDA chief also warned that the country’s unemployment rate, which went down to 5.1% in 2019, could surge to double-digits as lockdown measures across the country continue to disrupt business operations.

NEDA said around 116,000 to 1.8 million Filipinos could lose their jobs due to the economic impact of COVID-19.

Mr. Pernia added that the country lacks human resources such as experts, nurses, doctors and scientists that could aid the ongoing battle against COVID-19 as a growing number of Filipinos choose to work abroad.

NEDA said 2020 GDP growth could hit 4.3% at most this year if the impact of the pandemic will be mitigated. If the Luzon-wide enhanced community quarantine will be extended beyond one month, GDP could contract by 0.6%, the first decline since 1998.

The state economic planning agency also sees the country losing between P428.7 billion to P1.355.6 trillion in gross value added or equivalent to 2.1-6.6% of GDP.

The government has yet to revise its 6.5-7.5% GDP growth target for this year. The economy grew by 5.9% in 2019, failing to meet the 6-6.5% goal. — Beatrice M. Laforga

Household consumption to take hit amid coronavirus pandemic

By Marissa Mae M. Ramos
Researcher

ANNA CRUZ, a mother of two, has been struggling to feed her family since last week when Luzon was placed under enhanced community quarantine in order to contain the spread of the coronavirus disease 2019 (COVID-19) in the country.

“We may have money, but we have nowhere to buy,” she said in Filipino. “Groceries and wet markets have limited basic supplies in the province due to the lockdown.”

With Luzon in lockdown, work and transportation has been suspended, while local government units imposed curfews and checkpoints to discourage people from leaving their homes.

Economists have already trimmed Philippine growth forecasts this year amid the growing economic fallout from the pandemic. Even consumption — considered to be the backbone of the Philippine economy — is not spared.

“With strict curfews and limited mobility, the once potent Pilipino Purchasing Power is now sidelined and is in danger of falling into contraction in [the first half of 2020] should this persist,” ING Bank N.V.-Manila Senior Economist Nicholas Antonio T. Mapa said in an e-mail.

Mr. Mapa has downgraded his gross domestic product (GDP) growth outlook for this year to 5.6% with a 5.3% expansion as the worst case scenario.

The Philippine economy has been characterized as consumption driven, with household spending having contributed 68% to the country’s GDP last year.

University of Asia and the Pacific (UA&P) Economist Victor A. Abola said consumption growth likely weakened in the first quarter and “possibly” in the second quarter.

“Assuming a peak [of COVID-19 cases] in May, household spending may recover, but probably reach only 4%-5% growth for the year,” he said.

The last time consumption spending grew by less than four percent was in 2010 when it expanded by 3.4%. That year, GDP grew by 7.6% with consumption contributing just 2.4 percentage points (ppts).

In comparison, the economy grew by 5.9% last year, with consumption chipping in 3.9 ppts as it expanded by 5.8%.

The National Economic and Development Authority (NEDA) on Tuesday said it now projects -0.6% to 4.3% economic expansion this year “without mitigating measures” against COVID-19 outbreak.

“Household consumption is expected to decelerate until June as consumer confidence dips due to health concerns and social distancing measures. In particular, a 5% to 10% decline in household consumption of non-essential commodities… could result in a loss of gross value added of P45 to P94 billion, equivalent to 0.2 to 0.5% of GDP and reduce employment by 16,500 to 62,500,” NEDA said in its assessment of the COVID-19 impact on the economy.

ING’s Mr. Mapa said the impact brought by COVID-19 has created a “big hole” in consumption and that the government should be able to step in “to fill in the huge gaps.”

“The government may also need to consider doing all it can to help productive members of society keep their jobs and to those who will not be able to keep them, to retrain and hire them eventually. Government will need to take a hard look at income replacement via cash transfers because no income means no consumption and authorities must do all it can to keep the wheels of the economy running,” he said.

The government has earlier announced a P27.1-billion relief package to aid affected sectors, with an additional $1-billion loan under negotiation.

“The injection of funds for the COVID-19 program, with all its costs, will create an injection of funds in the economy. This stands to create a multiplier effect that is positively good for investment,” Colegio de San Juan De Letran Graduate School Dean Emmanuel J. Lopez said in a separate e-mail.

Jose Ramon G. Albert, senior research fellow at the Philippine Institute for Development Studies (PIDS), also stressed the importance of introducing a stimulus package to keep the economy afloat.

“Stimulus is badly needed especially as about 40% of the labor market is in the informal sector, many of whom are reliant on day-to-day living,” Mr. Albert said.

For UA&P’s Mr. Abola, the private sector should “also has to do its share” in providing safety nets such as giving employees their 13th month pay in advance, providing full pay to minimum wage earners, and providing food and medical assistance to poor households in cooperation with LGUs or foundations.

Among sectors, economists pointed to retail of essential goods, health care, and communication services as those that would continue to see growth. On the other hand, sectors that produce “postponable” goods stand to lose amid the quarantine.

ING’s Mr. Mapa said it is difficult to estimate how consumption will fare for the rest of the year with the main priority to contain the outbreak.

“We’ve moved beyond a financial crisis, beyond an economic crisis and are in a full public health crisis. Economic aspirations will likely be set aside as we strive our best to save as many lives and to get out of this situation at the soonest…,” Mr. Mapa said.

A “big catch up on economic activities” may be seen in the second half, PIDS’ Mr. Albert added.