Economy faces downfall before COVID — primer

The economic status of the Philippines was seen to be plummeting even before COVID-19 striked all around the world, due to a report's claim in July that the Philippines hit the biggest economic slump in history.

According to the midyear primer of IBON Foundation, the economy decreased from 7.1% in 2016, 6.9% in 2017, 6.3% in 2018, 6% in 2019, to a huge dip of -0.2% in the first quarter of 2020.

In the 2017-2019 period, the agricultural sector, wherein tubo, palay, cassava, coffee, and banana products hugely dropped, suffered from an annual average dip of 2.2%, and almost 1.4 million jobs were lost.

The economy also experienced slowness of the services sector by 8.2% in 2016, 7.4% in 2017, 6.7% in 2018, an increase to 7.5% in 2019, but swiftly plunged to 1.4% by the first quarter of 2020, compared to the 7.1% in the first quarter of 2019.

The Duterte administration maintained the labor export policy for overseas Filipino workers (OFWs), due to the fact that the country is depending on their remittances.

Due to the continuous decrease of remittances received ever since President Rodrigo Duterte took office, the administration was forced to re-calibrate their 2017-2022 target to improve the sector's annual average to 7.5%, because of the decrease from 6% to 2.2% in 2016 and 2017, respectively.

IBON stressed in their primer that the Build, Build, Build program has failed to stop the dullness in the economy in the past 4 years, which caused the Duterte administration to plan spending 7% from the GDP to build infrastractures in 2022.

"Nakakabahala ito dahil ang depisito sa badyet na Php660.2 bilyon noong 2019 ay katumbas na ng 3.4% ng GDP. Umabot na ang depisito sa badyet sa Php562.2 bilyon ngayong Enero-Mayo 2020 pa lamang, di-hamak na malaki sa Php808.6 milyon sa parehong panahon noong 2019," IBON wrote.

IBON also said that the economic downfall happened, not because of COVID-19, but when neoliberalism was implemented from the last 4 decades.

Under neoliberalism, the economy relied on foreign capital to focus more on service sectors, rather than the sector of production.

"Subalit matigas ang gobyernong Duterte sa pagpapatuloy ng neoliberalismo –

pagbubukas ng ekonomiya sa dayuhang pamumuhunan, dayuhang produkto

at dayuhang korporasyon, pribatisasyon o pagpasa sa pribadong korporasyon," the primer wrote.

The Philippines, letting the corporations lead the economy, has adapted to this system for 4 decades due to a principle that will help them to improve, according to IBON.

Due to relying too much on exports, IBON warned that the Philippines do not have a stable production, and poverty is also looming around the country.

Neoliberalism was also implemented amidst the new normal, such as the barring of the jeepneys, flexible work arrangements, and low wages.

IBON slammed the administration for being 'delusional' to keep depending on global exports, wherein this will still be implemented while fighting COVID-19.