Notes for next president: Huge debt, unemployment, hunger
Politicians harboring presidential ambitions should be prepared for the challenges of a heavy debt burden on top of a shrinking economy, rising unemployment and hunger due to the Duterte government’s “mismanagement” of the pandemic.
“This is a burden to the next administration. I don’t know why they want to run for President [when] we have this hefty debt,” Senate Minority Leader Franklin Drilon said on Wednesday.
“These are very difficult challenges for the next administration. I would repeat, this hefty debt as a result of the pandemic is a challenge,” he said in an interview on ANC.
“Let me emphasize that where we are today is the result of the mismanagement of the DOH (Department of Health) of our pandemic responses,” Drilon said.
The Senate leader pointed to what he described as the government’s “original sin,” which was President Duterte’s refusal to close the country’s borders to visitors from China, on the advice of Health Secretary Francisco Duque III.
He said the country was lagging behind in the procurement of vaccines “because of the failure to secure the much-needed doses early by making advanced payments with vaccine manufacturers.”
Short, long-term impacts
As a result of these policies, the economy is paying a heavy price “to arrest” the pandemic, Drilon said.
“The inoculation is very slow. At the rate we are going, I don’t know when we can achieve herd immunity,” he lamented.
Herd immunity, a condition where the spread of the virus is brought under control, is achieved when about 70 percent of the population had been inoculated.
Drilon said the next administration would be bombarded by both the short- and long-term impacts of the pandemic.
He cited the record-high P10.9-trillion national debt as of April, representing an increase of roughly P3.2 trillion from the 2019 figure.
In 2020, the Philippines borrowed a record P2.74 trillion to fight the health and socioeconomic crises inflicted by COVID-19. These borrowings exceeded the combined financing raised in 2018 and 2019, which totaled P1.91 trillion, and nearly matched the preceding three years’ total of P2.82 trillion, if 2017 borrowings were included.
For 2021, the national government plans to borrow P3.03 trillion. This would jack up the outstanding amount of debt to over P11 trillion by year-end.
Drilon, who supported government borrowings to finance the COVID-19 response, acknowledged the assurances made by Finance Secretary Carlos Dominguez III that the debt level remained manageable.
The finance chief told senators during a hearing on Tuesday that the total P88.6-billion budget for vaccine procurement “should be enough” to procure about 148 million doses to inoculate at least 70 million Filipinos.
But Dominguez said the Philippines might need about P25 billion more to cover the inoculation of children age 12 years old and above. “We are preparing for the purchase of booster shots of one dose for roughly 85 million adults and teenagers,” he said.
Drilon warned that the national debt would increase as the government had no choice but to raise its borrowings to finance its COVID-19 response, including vaccine purchases.
“Our economy continues to shrink. We have 4.14 million people who lost their jobs in April. About 21 percent of Filipino families experienced involuntary hunger,” Drilon said.
When 75 percent of the economy was closed last year at the height of the pandemic, the unemployment rate hit a record 17.6 percent in April 2020, or about 7.2 million Filipinos who lost their jobs.
The country’s jobless rate gradually declined as quarantine restrictions eased, reaching 7.1 percent in March this year. However, the unemployment rate rose to 8.7 percent in April as stricter lockdowns were implemented in the national capital, Metro Cebu, Metro Davao and six selected provinces.
Drilon said he did not believe the government economic team’s projection that the economy would recover by the second quarter of 2022.
“Even with the election spending in 2022, I don’t think we would be on the road to recovery by the second quarter of 2022,” he said. “To say that we will be going back to the 2019 economic level by the second quarter of 2022 is a pipe dream.” —WITH REPORTS FROM BEN O. DE VERA AND INQUIRER RESEARCH INQ
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