PHL's upper-middle-income goal will have to wait another year or two due to COVID-19 crisis —NEDA chief

The Philippines will try to achieve upper-middle-income status in 2021 or 2022 as it is impossible this year given the economic setback brought by the coronavirus disease 2019 (COVID-19) pandemic, the country’s chief economist said Saturday.

“Sana po this year ma-achieve natin ang upper-middle-income economy status, pero ang problema naman dahil sa unexpected crisis natin dulot ng COVID-19 baka ma-delay po ‘yan,” National Economic and Development Authority Acting Secretary Karl Chua said during the Laging Handa public briefing.

The Philippine economy as measured by gross domestic product (GDP) contracted by 0.2% in the first quarter of 2020, the first time since 1998.

The economy is seen to contract further in the second quarter, accounting for the full extend of the enhanced community quarantine’s extension during the period.

Due to the “temporary setback” arising from the global pandemic, Chua said the Philippines will catch up with the goal to achieve upper-middle-income status in 2021 or 2022.

“Susubukan natin humabol if not next year by 2022,” he said.

In 2019, Former NEDA chief Ernesto Pernia said that the the country can achieve upper-middle-income status in 2020. 

Under World Bank criteria, an upper middle-income country should have a gross national income (GNI) per capita of between $3,896 to $12,055.

As of 2018, the Philippines was classified as a lower middle-income country with a GNI per capita of between $996 and $3,895, while high-income economies are those with a GNI per capita of $12,056 or more.

Balancing economy, public health

Asked if the economy can handle prolonged lockdowns, Chua noted that the economy is run by the people.

“‘Yung ekonomiya kasi ang nagpapatakbo niyan ay mga tao, ang ating kababayan,” he said.

“Kaya ba ng bansa natin, ng pamayananan o ng pamilya na makita na madagdagan ang magkasakit o mamatay dahil sa COVID?”

A study conducted by a team of faculty members from the University of the Philippines found that “premature” relaxation of the ECQ in Metro Manila could result in an escalation of 24,000 cases and 1,700 deaths by June 15, 2020.

“Totoo naman na gusto natin mabalik ang takbo ng ekonomiya pero dapat maging maingat tayo dahil ‘pag na-open up tayo ‘yung pag transmit ng virus pwedeng bumilis,” Chua said.

“Kaya ito ay binabalanse natin... Binabalanse nang maayos. ‘Pag sinabi na ng datos na humihina na ang COVID cases or handa na ang healthcare system natin, sapat na ang testing ay siyempre pwede po tayo mag-relax o open up.

“‘Pag di pa tayo handa... ang factor basis sa decision ay buhay ng ating mga kababayan,” he said. -MDM, GMA News