Trade Secretary Ramon Lopez expressed confidence for a more optimistic business outlook for 2021, reacting to the latest Social Weather Stations (SWS) report of the November 2020 Net Economic Optimism released last January 5, which showed that that 42 percent of Filipinos expect the local economy in better shape in the next 12 months.
“The Duterte administration remains committed in its thrust to assist local businesses build back better. This report shows that despite the setbacks that our enterprises faced during the height of the pandemic, Filipino resiliency and innovativeness will always prevail,” Lopez said.
According to the survey, only 18 percent of Filipinos expect the economy to worsen this year while 28 percent said it would stay the same. This resulted in the net economic optimism score of +24, which is classified as “high”. The SWS described the November 2020 report as a “recovery” from the mediocre scores of -9 in July and -5 in September of last year.
“DTI (The Department of Trade and Industry) will continue to implement various programs under the REBUILD PH campaign, or Revitalizing Businesses, Investments, Livelihoods and Domestic Demand, as we have continuously done when we slowly eased into reopening the economy,” he added.
“With 99.5 percent of our businesses being micro, small, and medium enterprises (MSMEs), DTI shall further strengthen its programs to support MSMEs, such as in training, mentorships, microfinancing and equipment support and market development for enterprises to become Covid-proof. This will save companies that will save jobs. These jobs, in turn, will sustain the incomes that will create demand, which would help to revive the economy,” the trade chief explained.
Lopez further expressed optimism with the government’s forecast that the Philippines will have a 6.5-percent gross domestic product (GDP) growth for 2021. Likewise, he highlighted the signs of economic recovery, which started to be apparent during the latter half of 2020. These range from the continued improvements in GDP growth from -16.5 percent in the second quarter to -11.5 percent in the third quarter, and lowered unemployment rate of 8.7 percent in October from a record-low 17.7 percent in April.
He also noted the Purchasing Managers’ Index (PMI), which reached 50.1 in September, indicating stable conditions in the manufacturing sector, and only slightly dropped to 49.2 in December. There was also the positive growth in exports reaching 2.9 percent in September but facing dipping by 2.2 percent in October, which the Trade Secretary described as a “minor bump on the road to recovery.”
Furthermore, Lopez said that he is looking forward to the passage of the Corporate Recovery and Tax Incentives for Enterprises Act (CREATE), calling it a “game-changer” aimed at lowering corporate income tax down to 20 percent from the current 30 percent for MSMEs or domestic corporations with total assets, excluding land, of not more than P100 million and net taxable income of P5 million and below. The bill is currently at the bicameral conference committee in Congress and is expected to be passed for President Rodrigo Duterte’s signature soon. CURRENTPH