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Business

‘New normal’ to allow return to pre-COVID-19 growth by H1

Louise Maureen Simeon - The Philippine Star

MANILA, Philippines — The sustained implementation of Alert Level 1 in most areas in the country will allow the economy to return to its pre-pandemic growth pace by the first half of the year.

In a radio interview, National Economic and Development Authority (NEDA) Undersecretary Rosemarie Edillon said the Philippines may return to its pre-pandemic level as early as the first quarter until the second quarter of 2022.

“If we can really sustain this, our estimate is that we can recover our 2019 level by the first or second quarter. But what we need is to catch up and grow faster,” she said.

For 2022, the government is looking at a seven to nine percent gross domestic product (GDP) growth, from the 5.6 percent expansion last year.

In terms of nominal GDP, the Philippine economy is at P19.387 trillion, up from the 2020 level of P17.939 trillion.

Pre-pandemic, GDP is down by only about 0.7 percent from the 2019 level of P19.518 trillion.

“This Alert Level 1 should continue and eventually reach the point that there will be no more alert levels, which we are already preparing for in the transition plan,” Edillon said.

Currently, Metro Manila and 38 other areas are under Alert Level 1 until March 15. These areas benefit 62 percent of the economy, contributing P9.4 billion per week of which salaries account for P3 billion.

However, Edillon emphasized that businesses are still monitoring the continuity of the current alert level.

“Businesses are estimating whether the situation will really be continuous before they decide to expand,” she said.

“Just because we downgraded to Alert Level 1 doesn’t mean businesses will immediately hire people,” she said.

NEDA earlier said the economy stands to gain some P16.5 billion per week if the entire country would be placed under the most lenient pandemic alert classification.

Doing so is seen to allow 38 percent of the economy to return to the “new normal” and help 52 percent of the country’s workers. It will also reduce 297,000 unemployed Filipinos over the next quarter.

Of the P16.5 billion in additional economic output, P5.2 billion will be gained by workers in terms of salaries.

NEW NORMAL

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