MANILA, Philippines – The government is facing a cash crunch from the impact of the coronavirus disease (COVID-19) pandemic.
Through the end of 2019, the country’s economy was already improving, but the COVID-19 crisis led to a budget deficit or revenue shortfall of 5.3 percent in the first quarter of 2020.
This means the government is spending more than what it earns due to COVID-19.
Aside from this, the Philippines’ gross domestic product (GDP) is likely to plunge to zero or minus one percent, according to Finance Secretary Sonny Dominguez, adding that the country’s debt-to-GDP ratio is also expected to increase to 47 percent if the crisis progresses.
In fact, COVID-19 has already impacted about 1.2 million workers in the country.
In consideration of the current state of the country’s economy, the national government plans to borrow money from the Asian Development Bank and the World Bank.
“We will probably be borrowing about US$5.6 billion from them. Kung kulang pa ito (if its not enough), we will go to the commercial market,” Dominguez said.
Meanwhile, President Rodrigo Duterte said he is willing to drop some of the government’s projects or sell some of its assets if needed, including the Cultural Center of the Philippines (CPP) and the Philippine International Convention Center (PICC).
“What is the end game? Kapag maubos talaga ang pera, ipagbili ko lahat ng propridad ng gobyerno (If money runs out, I will sell all government properties), the President said in a late-night address on Wednesday (April 8).
“Kapag wala na akong makuha (if I can’t get any more funds) and we are about to sink, I will sell all the assets of the government,” Duterte said. MNP (with details from Rosalie Coz)
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