The recession is said to be over because the Philippine economy has recovered in the second quarter of the year where the country’s gross domestic product (GDP) hit 11.8 percent, based on data released by the government on Tuesday.
This is said to be the fastest economic growth since 1988.
But that does not mean that the economy has finally recovered from the pandemic.
This is also due to the size of the economic collapse in the second quarter of last year, where GDP was -17 percent.
If you look at the amount lost to the economy due to the pandemic, it is still not recoverable.
According to Socioeconomic Planning Secretary Karl Chua, ECQs are more targeted in 2021 compared to 2020, and this has helped lift the economy.
Government economic managers also believe that the economy will recover from the ECQ this August as long as the public vaccination is speeded up and the number of COVID-19 cases does not increase.
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Philippines exits recession with 11.8 percent GDP
“With the second-quarter results, they will help us achieve our target for the year. However, it also depends on the outcome of the present ECQ… We will maximize the ECQ through vaccination,” said Chua.
But according to an economist, the economy may return to pre-pandemic levels in the latter part of 2022 due to repeated lockdowns.
“By the latter part of 2022 (presidential election year), GDP in pesos would be back to 100 percent of pre-COVID levels,” said Michael Ricafort, chief economist of the treasury group of Rizal Commercial Banking Corporation.
For now, everyone is hoping that the lockdown will last only up to 2 weeks and the economy will reopen by August 21st.
In May, the Philippine economy fell by 4.2 percent in the first three months of 2021.
The amount lost to the country’s economy in more than 1 year has reached more than P2 trillion. This is almost 45 percent of the government’s 2021 budget of 4.5 trillion.
Five consecutive quarter contractions last occurred in the 1980s in conjunction with the country’s debt crisis. Up to 9 consecutive quarters were recession then.
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