More

The good news from the IATF is that quarantine restrictions will be relaxed in a majority of provinces. The relaxation includes opening up some public transport in areas where incidence of infection is low.

The bad news is that “enhanced community quarantine” is extended until May 15 for the NCR, Region III, Region IV, Cebu and Davao. These areas account for the bulk of the nation’s GDP.

Clearly, the economy is not about to roar any time soon. This year has to be written off. Our enterprises are all counting their losses and limiting their costs. Consumer data indicates the bulk of spending will be for food. Consumer durables and luxury items have completely lost their market.

One UN expert advises us to prepare for famines “of biblical proportion” in some parts of the world. With shelter-in-place policies in effect, it is understandable that supply chains will be choked and farm produce stranded.

In our own case, it should be a good idea for government to lead in a campaign for emergency food production. All available land must be planted to vegetables. Some of our cash crop areas may be diverted to basic subsistence production.

Our food security is premised on the availability of imports. We cannot rely on that now. The countries we buy food from would want to hold on to their stocks for their own comfort.

An American expert yesterday thinks that restrictions on movement could be necessary for the next three years. This is about the time required for a vaccine to be developed and its production scaled up. There will be billions waiting in line to be vaccinated.

The restrictions on movement will involve a ban on non-essential travel. That is bad news for our tourism industry. We might have to shut down this vital component of our economy for three years at least.

The global economic slowdown will also mean OFW remittances will be dramatically reduced in the foreseeable future. When restrictions are relaxed, we could see thousands of OFWs opting to return home. That will add to the ranks of the unemployed.

It is nice to dream of a rapid recovery after this epidemic passes. The greater likelihood, however, is that we will be in for a prolonged slowdown. We must focus our thinking on surviving the global recession in the near term.

This global recession will mean investments will be reduced to a trickle. Trade will be minimal. Tourists will be extinct. The BPO sector, once a major driver of our growth, will likely shrink. Our tenuous middle class will have less disposable income.

Before thinking of dramatic recovery, we must understand that that, in the interim, we will have to think of sheer subsistence.  In this interim period, we will have to deal with problems associated with high unemployment, inadequate food supplies, widespread hunger and malnutrition. We need a comprehensive strategy now to reduce the volume of misery associated with recession.

This transitional phase prior to full recovery seems to be absent from the plans being drawn up. It is a transitional phase that could stretch for years.

High unemployment and widespread hunger could produce second-generation social problems. We could see a spike in crimes against property, for instance. We should prepare for that, too.

The virus will not dissipate anytime soon. There could be a second wave of infections, and after that a third wave. Whatever resources we could scrape together will have to be invested in beefing up our health system.

Our people must be made to understand that the ability of government to finance amelioration programs is limited. Government will not be getting the revenues earlier expected. Right now, government has been borrowing for budget support. We can only borrow so much, considering that every government on earth will be tapping the financial markets for emergency borrowing.

In the first weeks of this crisis, our large corporations responded generously to reinforce the health care system and bring relief to the poor communities. Their capacity for continuing that support is finite as well.

We likewise received precious assistance from friendly governments, such as China. The assistance came in the form of critically needed medical supplies. That flow of assistance will not be unlimited.

In a word, we have to prepare to a prolonged period of economic difficulty. For our most vulnerable sectors, government is the last resort for relief.

Subsidies are an important means for short-term relief. But this is unsustainable. Over the next few months, government and the private sector will have to think in terms of providing emergency employment. This at least will have some return down the road.

Banish the thought that this is a momentary crisis.

As the recession eradicates jobs and destroys production capacity, we must prepare to for a long battle to save our own economy. The shortest cycle we can work with is food production. We can expand that quickly to avert famine. Demand for food could not possibly diminish.

We might also initiate a low-cost housing program where the unemployed could be attracted to contribute “sweat capital.” This will help address the massive housing shortage we have.

Through the Build, Build, Build program, we could quickly generate jobs using project funding. The funds for this program, involving borrowed funds, could not be redirected to support subsidies.

At no time have local governments been more important than today. Beyond enforcing quarantine procedures and delivering immediate relief, our local governments might also take the lead in smaller scale economic initiatives that will employ many.