MANILA – The chairman of the House Ways and Means on Tuesday said the economic managers’ growth target of 5 to 6 percent of real gross domestic product (GDP) for 2021 is “becoming increasingly attainable” as the country’s economy reopens and as economic prospects brighten.
Albay Rep. Joey Salceda cited declining aggregate Covid-19 numbers, accelerated vaccination, and adjustments in the workplace as signs that the economy is ready to rebound.
“Second-quarter GDP growth was 12 percent, immediately followed by a 7.1 percent growth in the third quarter. I am strongly convinced that, if nothing goes dramatically wrong in the final quarter, we will reach our annual growth targets for this year,” Salceda said. “Our worst fears of stagflation are probably over. We will not stagnate in 2022 and 2023, it looks like."
He, however, cautioned that with a recovering economy, prices tend to go upward.
"That could be a problem because employment and wage recovery tend to come much later than actual growth. So in the meantime, prices will bear down struggling families," he said.
He expressed confidence that the monetary policy tools to stave off inflation are in place, but supply issues might hamper the stabilization of prices.
He appealed to the Department of Agriculture, Department of Transportation, Department of Public Works and Highways, and the Department of the Interior and Local Government to ensure that there is no congestion of ports, expressways, airports, and other conduit points for supply as demand begins to pick up.
He suggested the creation of a Task Force Supply Chain Management, along with the Department of Trade and Industry, to anticipate and prevent supply congestion.
The Bangko Sentral ng Pilipinas projects annual inflation to settle at 4.3 percent for 2021.
Salceda warned that December inflation could be “significantly above the annual average" given the sudden pick up in demand that will unlikely be met by proportional adjustment in supply.
He proposed a five-point plan to ensure that inflation does not pick up in this final month, which includes securing and decongesting ports, airports, expressways, and other thoroughfares; and expanding efforts to facilitate markets for farmers that are expected to harvest their products this month and prevent spoilage.
Other strategies in the plan are expediting the processing of papers for imports of food, ramping up consumer protection and price monitoring actions, and lowering the price of input goods such as oil.
“Congress is already working on the fuel excise tax suspension for six months. Thankfully, crude prices abroad are also starting to stabilize. Recovery is starting to come. Inflation will be the next enemy," Salceda said. (PNA)
