2020 Working Paper (2020-16)

Working Paper 2020-16
The Philippine Economy During the COVID Pandemic
Joseph Anthony Lim 

Abstract 

This paper describes and analyzes the impact of the COVID pandemic and the subsequent hard and mild lockdowns on the Philippine economy at various stages from March, 2020 to early September, 2020. The COVID pandemic and resulting hard lockdown (Enhanced Community Quarantine) from March 17, 2020 to May 31, 2020 had resulted in the highest unemployment and biggest fall in Philippine GDP on the second quarter of 2020. The paper shows 90% of the labor force was affected by this hard lockdown. Bayanihan Acts 1 and 2 are the biggest Social Amelioration Program (SAP) ever legislated and implemented by the Philippine government.  The paper discusses the need for a bill to prevent the danger of massive loan defaults, bankruptcies and potential financial crisis resulting from the deep recession. The paper goes on to discuss the debate between more conservative economic managers, on one hand, and legislators and NGOs who want a stronger and more encompassing fiscal stimulus to the distressed economy, on the other. It ends with a discussion on the crux of the debate, which is financing the fiscal deficits that will arise due to the pandemic and the economic stimuli.  

Keywords: Philippines, recession, COVID pandemic, fiscal stimulus