The chair of the House Ways and Means Committee on Monday said the country’s economic managers should prepare a contingency plan to insulate the Philippines from spillover effects as China’s economic growth slowed to 4.9 percent in the third quarter amid the debt crisis surrounding property giant Evergrande’s debt crisis.

Albay Rep. Joey Salceda said it is best to prepare a “low-hanging package” that includes fast-tracking infrastructure next year, increasing food production, a proactive rollback of policy rate reductions early next year, and continued spending on the emergency employment fund to assist displaced workers amid the pandemic.

Salceda said the country’s experience with global systemic risks is that the “earlier it prepares, the better it performs.”

“There are signs that the situation with Evergrande is systemic. New construction in September slowed down for a sixth straight month in China, that country’s longest period of monthly declines since 2015. There is also another real estate company that defaulted on its debts,” he said in a statement.

Salceda was referring to a liquidity crisis at China Evergrande Group, which has more than USD300 billion in liabilities. The development has rocked global markets.

He said South China-based luxury real estate developer Fantasia Holdings also said it failed to make a $206-million US dollar bond payment two weeks ago.

“So, although the Chinese economic authorities are trying to allay market fears, I would be on high alert, especially since many of our big conglomerates have exposure in the Chinese real estate market,” Salceda said.

He said China’s economic condition could also be “an opportunity in disguise” for the Philippines to open up its economy and welcome more investments from companies seeking to diversify supply chains.

He added that while the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act is the greatest tool in this regard, the enactment of amendments to the Retail Trade Liberalization Act, the Public Service Act, and the Foreign Investments Act would also be beneficial.

“If some sort of capital flight happens in China, it will all have to go somewhere. If our economy is not open enough, it will be like catching rainwater with a thimble. Let’s open some of our archaic restrictions, so that when it rains, we have something bigger to catch water with,” Salceda said.