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Philippine Finance Chief Seeks to Further Reopen the Economy

Bloomberg logoBloomberg 7/1/2020 Andreo Calonzo
a city street: Near empty streets in Bonifacio Global City (BGC) in Metro Manila in March. © Bloomberg Near empty streets in Bonifacio Global City (BGC) in Metro Manila in March.

(Bloomberg) -- Philippine Finance Secretary Carlos Dominguez seeks to further loosen movement curbs in the capital region to reignite an economy facing its deepest slump in three decades.

The greater Manila area and its neighboring regions, which account for about 70% of economic output, should be placed under the lowest level of restrictions, Dominguez said at a televised briefing on Wednesday. The capital was kept under a general community quarantine while the strict stay-at-home order in Cebu City was extended through July 15.

The finance chief is encouraging President Rodrigo Duterte who implemented one of Asia’s early and longest lockdowns amid the coronavirus pandemic to put Metro Manila under a modified general community quarantine “as quickly as possible because people have to start working.” Nearby regions have already been placed under the lowest quarantine level, where industries can operate at full capacity.

Since June 1 when Duterte allowed some businesses and transportation to resume, confirmed cases have doubled to 38,511 as of Wednesday while deaths stood at 1,270. High levels of community transmission in new hotspots in central Philippines are driving the increase, Health Undersecretary Maria Rosario Vergeire said in a briefing. Most new infections in May and June were from the more than 92,000 returning overseas Filipino workers, she said.

Virus Surge Threatens Developing Nations Exiting Lockdown

Still, Dominguez told Duterte that “we really should begin opening” as millions of Filipinos have already lost their jobs. Lockdowns must be limited on a place-to-place, or even company-to-company basis, the finance chief said. “If a company has a big spike, close it down.”

The $331 billion economy may have slumped by as much as 6.7% in the second quarter when much of the country was under strict lockdown, according to the central bank. The government expects gross domestic product to contract by 2%-3.4% this year. Unemployment rate climbed to a record 17.7% in April as the number of jobless surged to 7.3 million. Labor force participation fell to an all-time low of 55.6%.

In Cebu, the number of critical cases and deaths are rising, Carlito Galvez, chief implementer of measures to stem the outbreak, said on Monday. The central Visayas region where Cebu is located had 21 Covid-related deaths in the past two weeks -- the highest in the country.

(Updates case count, adds comments from Health department from fourth paragraph.)

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