With the enhanced community quarantine placed throughout Luzon, the government’s economic team set aside P27.1 billion in response to sectors affected by the coronavirus. State economic managers noted that the coronavirus pandemic will not halt key programs of the government such as the “Build, Build, Build” program.
Here’s the breakdown of the spending plan:
- P14 billion for tourism programs
- P3.1 billion for test kits
- P3 billion for scholarship programs of displaced workers
- P2.8 billion for survival and recovery programs of farmers and fishermen (zero interest loans of up to P25,000 for those affected by calamities and disasters)
- P2 billion for social protection programs (wage subsidy and financial support of vulnerable workers)
- P1.2 billion for unemployment benefits
- P1 billion for small and medium enterprises
Finance secretary Carlos Dominguqez III noted that half of the “war chest” against coronavirus went to tourism because it is currently the most affected sector. A decline in 1.4 million tourist arrivals with a foregone gross value added of P97 to P187 billion are estimated to stem from the tourism industry. Three billion pesos were already lost from flight refunds alone. However, Department of Budget and Management Secretary Wendell E. Avisado said that this is only an initial allotment to state that funds are available. They will shift the funds on whichever area it is needed or required when the situation calls for it.
In addition to this economic package—based on the assumption that the “contagion will end shortly after midyear”—the government is currently seeking a $1 billion loan (although it wasn’t confirmed with which lenders) to support the initial package. A $3 million grant from the Asian Development Bank has already been set to purchase additional medical supplies.
According to Avisado, the government will still be able to facilitate the release of allotments and cash allocations as needed in health, infrastructure and peace and order requirements. It’s still too early to determine the economic impact of the Luzon-wide enhanced community quarantine but according to Socioeconomic Planning Secretary Ernesto M. Pernia, it should be fleeting.
Subscribe to our weekly newsletter to receive all the tools and solutions entrepreneurs need to stay updated on the latest news in the industry