Reviving the Philippine Economy under a Responsible New Normal

After the reclassification of areas under enhanced community quarantine (ECQ) to general community quarantine (GCQ), the urgent task for the Philippine government is to provide an exit plan to revive the Philippine economy. Given the significant economic damage resulting from the shutdown of roughly 75 percent of the country’s total production in the National Capital Region (NCR) and in the CALABARZON and Central Luzon areas, a gradual reopening of the economy will be necessary to prevent further economic damage that could not only be difficult to repair, but also long to overcome. Indeed, based on recent directives from the government, a substantial number of industries and services have thus been allowed to operate in both the ECQ and GCQ areas. However, as the Philippine government begins to calibrate the opening of sectors, there remain concerns as to how this process will affect jobs and livelihoods now and beyond. In this context, an economic recovery plan that talks about short-term, a transition, and full recovery phases— encompassing a revision of the current Philippine Development Plan without losing sight of the long-term goals envisioned in Ambisyon Natin 2040— is still needed. Indeed, a key component of AmBisyon 2040 has been of building resiliency over the long-term, which includes resiliency in health and economic shocks apart from natural disasters. At the same time, this recovery plan should also be accompanied by structural reforms to enhance its implementation. The Department of Finance has crafted a four-pillar socio-economic strategy aimed at: (a) supporting the more vulnerable sectors of society; (b) increasing medical resources to contain the virus and offer safety to front-liners; (c) keeping the economy afloat through financial emergency initiatives; and (d) creating jobs and sustaining the economy. Yet while enumerating the costs of these plans, the said strategy lacked details on how the country could achieve some of the goals without the availability of widespread testing and adequate health facilities. Loan guarantees, cash transfers, and other forms of subsidies can revive disrupted supply chains but cannot restore productivity in the middle of a persisting health crisis, while the uncertainty of a possible outbreak can keep workers from supplying goods and services. It is crucial to have these programs and institutions in place since a number of cities, regions and provinces have started to reopen. A modified community quarantine without the necessary health system investments, protection measures, and economic recovery plan risks amounting to an unregulated herd immunity strategy. Opting for herd immunity allows governments to blame the failure of the health and economic system on the virus, rather than on bad governance. Under current GCQ protocols, the burden on containing the virus is mostly transferred to the public. Unless the government provides mass testing, the problem of information is aggravated, probably raising the transmission risks. Moreover, unregulated herd immunity will be differentially felt by the poor. As healthy workers may recover their earnings from the modified quarantine, the poor, who have limited access to the health services and are thus more susceptible to the virus, are unlikely to benefit from this system. In effect, this will only exacerbate the inequality that prevails in the country. Moving towards a responsible new normal requires a strategy that addresses both people’s wellbeing and the socio-economic weaknesses exposed by COVID-19. Thus, the strategy should have the following elements

May Measurement Month 2018: a pragmatic global screening campaign to raise awareness of blood pressure by the International Society of Hypertension

Aims Raised blood pressure (BP) is the biggest contributor to mortality and disease burden worldwide and fewer than half of those with hypertension are aware of it. May Measurement Month (MMM) is a global campaign set up in 2017, to raise awareness of high BP and as a pragmatic solution to a lack of formal screening worldwide. The 2018 campaign was expanded, aiming to include more participants and countries. Methods and results Eighty-nine countries participated in MMM 2018. Volunteers (≥18 years) were recruited through opportunistic sampling at a variety of screening sites. Each participant had three BP measurements and completed a questionnaire on demographic, lifestyle, and environmental factors. Hypertension was defined as a systolic BP ≥140 mmHg or diastolic BP ≥90 mmHg, or taking antihypertensive medication. In total, 74.9% of screenees provided three BP readings. Multiple imputation using chained equations was used to impute missing readings. 1 504 963 individuals (mean age 45.3 years; 52.4% female) were screened. After multiple imputation, 502 079 (33.4%) individuals had hypertension, of whom 59.5% were aware of their diagnosis and 55.3% were taking antihypertensive medication. Of those on medication, 60.0% were controlled and of all hypertensives, 33.2% were controlled. We detected 224 285 individuals with untreated hypertension and 111 214 individuals with inadequately treated (systolic BP ≥ 140 mmHg or diastolic BP ≥ 90 mmHg) hypertension. Conclusion May Measurement Month expanded significantly compared with 2017, including more participants in more countries. The campaign identified over 335 000 adults with untreated or inadequately treated hypertension. In the absence of systematic screening programmes, MMM was effective at raising awareness at least among these individuals at risk

Signs of accountability in economic policy: the case of VAT

The volume Democratizing Governance presents an agenda of hope for good governance in our country. The essays in this volume cohere along one claim – our political hope lies in building a viable state that can govern us well and justly. This means that we should focus on rebuilding out governance systems so that they allow government to be responsive to the demands of the people and allow citizens to fruitfully engage government in the shared task of state and nation building

Gross International reserves: accumulation management, and relation to debt

This paper narrates pertinent lessons learned from financial crises and how countries have responded to them. With lessons learned comes the reaction to accumulate gross international reserves (GIR). A strength-weakness-opportunity-threat (SWOT) assessment of the present level of GIR of the Philippines is presented. The GIR is also juxtaposed with the debt of the Philippines. It provides insight into whether the debt of the Philippines is more external or internal, and whether it is a problem at all. With the continuing accumulation of debt, its level may have reached the point of excess. The consideration is whether to shift from passive liquidity management to active investment seeking, external debt management, or active inclusion

Economics and Society

This book is intended to be a self-contained introduction to economics. The range of topics, as well as the style of delivery, is the reflection of current state of economic pedagogy at the Ateneo de Manila University, the home institution of the majority of the authors in this book. Guided by the value of cura personalis, careful explanations of the material are made to enhance students\u27 understanding. Because the authors are mindful of the target audience, 17 or 18 year-olds, perhaps even younger, the exposition is made as straightforward as much as possible. In the pursuit of academic excellence, that is magis, the contents of the book have been judiciously selected in such a way that students get a complete introduction to the essential elements of economcis. The organization of the book closely follows the standard sequence of a first course in economics. Chapters 1 and 2 serves as introductory chapters and seek to orient the students to the nature of economics and its basic methodology. Chapters 3 and 4 on supply and demand theory and elasticity, respectively, are on the front-end because they immediately give the students simple economic concepts that are readily applicable to many real-life situations. Chapters 5, 6, 7, 8 constitute basic microeconomics. In linear fashion, the essence of micro is built up as we start from basic consumer and producer theory, after which the students are ushered into the analysis of markets and market imperfections. Basic macroeconomics takes up more chapters. It starts with introductory topics in macroeconomics found in chapters 9 and 10 which introduces the main macroeconomic variables and concepts. The Keynesian orientation is evident with the next chapters, chapters 11, 12 and 13, whereby demand factors such as investment and other components of aggregate demand are analyzed. The next set, consisting of four chapters, namely chapters 14, 15, 16 and 17 forms another block. This time economic policy takes center stage and fiscal and monetary matters are discussed, including the topic of taxation. The last set of chapters branches out to the realm of applications. Both chapters 18 and 19, on international trade and exchange rates, respectively, are meant to introduce to the students some basic concepts in international economics. On the other hand, chapters 20 and 21 tackle development issues and agrarian reform

The Political-Economic Sentiments of the People: What the 2007 Senatorial Election Says

As reflected in the analyses in this volume, the extant research on electoral outcomes in the Philippines does not yet clearly link those results to policy positions of the candidates. In this paper, I attempt to provide some initial insights on this, using data from the 2007 national elections and focusing on Senatorial votes. I compare the results to the public positions taken by candidates on three of the most controversial political economic issues of the time. These are the value added tax (VAT), charter change, and the impeachment complaint against President Gloria Macapagal-Arroyo (PGMA). It is beyond the scope of this paper to fully elaborate on these reforms. One goal of this brief study is to try and link the candidates’ stances on these issues to the eventual voting results to see whether and to what extent their positions translated into votes. Another goal is to determine whether it even matters for the candidates to take stances on these issues

The relationship between dynamic price and dynamic unemployment: the case of the Central European-3 and the Baltic Tigers

Convention specifies the relationship between price and unemployment in terms of the Phillips curve (PC) where inflation and the rate of unemployment are correlated. This paper uses a variant of the PC that is more consistent with the relationship between price and output as depicted in the aggregate supply (AS) curve. The relationship between price and unemployment using convention and its variant is tested on Poland, the Czech Republic, Hungary, Estonia, Latvia, Lithuania and the pooled data. The Expectations Augmented (EA) is able to track a negative relation between inflation and unemployment better than the New Keynesian (NK) is able. Within the EA runs, the convention is able to track the same negative relation better than the variant, but one has to be cautious given the implied results

Efficiency of the Philippine stock exchange using serial correlation and variance ratio tests

Literature regarding the efficiency of the Philippine stock markets is limited because most writers take it as a fact that the market is inefficient. This paper quantitatively tests the degree of efficiency of the market using serial correlation and variance ratio tests. In so doing, this paper points to which firms are considered efficient and otherwise. In the serial correlation test, no serial correlation accepts the efficient market hypothesis and accepts the possibility of a random walk sequence. The presence of serial correlation does not necessarily indicate inefficiency but rejects the random walk sequence. To test whether the serial correlation warrants inefficiency, this paper uses a simplified Alexander (1961) filter rule to figure whether the technical trading rule can beat the buy and hold strategy. If technical trading rule beats the buy and hold strategy, then the stock is inefficient. Otherwise, the stock is considered efficient. Since, the simplified filter rule that will be employed represents only one of infinite number of technical trading rules possible, this necessitates for a more restrictive test for efficiency: the random walk test. Here the variance ratio test comes in. A variance ratio equal to one accepts the efficient market hypothesis and that the particular stock follows a random walk. A variance ratio not equal to one does not necessarily reject the efficient market hypothesis but rejects the random walk process