Cutting PH debt, inflation on DOF's transition plan for next president's economic team

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Finance Secretary Carlos Dominguez III (FILE PHOTO)

Metro Manila (CNN Philippines, November 26) – President Rodrigo Duterte's economic team has started work on a transition plan – hoping that the country's recovery path will be sustained by the next administration.

Finance Secretary Carlos Dominguez bared details of the blueprint during Friday's Philippine Economic Briefing for foreign business associations. He said it will focus on four key areas to ensure the Philippines can offset losses accumulated over the past two years of the COVID-19 pandemic and return to growth mode even after Duterte steps down from office in June 2022, or seven months from now.

READ: PH losses from pandemic may hit ₱41.4 trillion over the next 40 years — NEDA

"This administration will make sure to help the next president and the next generations to address the fiscal and economic risks brought about by the pandemic," Duterte's top economic manager said.

"Whoever wins the upcoming elections will need a solid tax reform program, and we are working to ensure that the next administration has what it needs to pursue that program," he added.

The May 9, 2022 elections will decide who will lead the country for the next six years. It is expected to be a seven-way race to the presidency among Vice President Leni Robredo, Senators Bong Go, Ping Lacson and Manny Pacquiao, Manila Mayor Isko Moreno, labor leader Leody De Guzman, and former Senator Bongbong Marcos, who faces four cases against his candidacy before the Commission on Elections.

"The first issue is how to grow out of the debt. The second issue is how to deal with inflation. The third issue is how to deal with inequality among our people, because let's face it, the guys who got worst hit are the poorer segments of our society," Dominguez said, adding that resolving inequality of growth among regional peers is the fourth challenge.

READ: PH outstanding debt stock balloons to fresh record ₱11.9T in September

Domestic output expanded by 4.9% from January to September, with both Dominguez and Socioeconomic Planning Secretary Karl Kendrick Chua seeing even faster growth in the fourth quarter. They expect full-year economic growth at the "high end," or even breaching the 4-5% target.

However, that is not yet enough to undo 2020's recession due to lockdowns, which has sent more Filipinos out of jobs and into poverty.

Chua said he is "encouraged" by the uptick in consumer spending, citing data that foot traffic in malls are returning to pre-pandemic levels as weekend visits are now at 81% of where it was before the local outbreak. He added that fast food chains are welcoming back 78% of its diners, too.

For Chua, the path to recovery would be quicker if the country shifts to alert level 1 by January, if vaccines are administered to more people, and if all schools are reopened for face-to-face classes as soon as possible.