DOMINGUEZ SEES ECONOMIC REVIVAL

Finance Secretary Carlos Dominguez III said Friday the revival of private enterprises and consumer activity will propel the country to a sustainable recovery starting this year as he foresees encouraging prospects for the economy, especially with the negotiations for the purchase of COVID-19 vaccines and their delivery well underway.

Dominguez thanked both chambers of the Congress for ratifying on time two of the recovery measures that would both provide the private sector with the stimulus it needs to bounce back from the economic shock of the COVID-19 pandemic.

These are the Corporate Recovery and Tax Incentives for Enterprises Act (CREATE), which lowers the corporate income tax (CIT) and provides the government more flexibility in the grant of investment incentives to corporations; and the Financial Institutions Strategic Transfer (FIST) law, which was signed recently by President Duterte to let banks efficiently offload their bad loans and non-performing assets (NPAs) so they could lend more to pandemic-hit businesses.

These measures, along with the Government Financial Institutions Unified Initiatives to Distressed Enterprises for Economic Recovery (GUIDE) bill that aims to rescue strategically important companies with solvency woes, will complete the set of recovery measures needed to revitalize the private sector, Dominguez said.

While the economic team expects a strong gross domestic product (GDP) growth of 6.5 to 7.5 percent this year, Dominguez said the country cannot recover all that it had lost in 2020 in just one blow as “it will take us more years to nurse our economy to where it was before the pandemic struck.”

“However, the prospects for 2021 are encouraging. We have gone through the worst episodes of this pandemic. Medical science knows more about the virus. Vaccines are available. Public health protocols have been carefully studied. And we are ready to reopen the economy,” Dominguez said in this morning’s virtual Economic Forum hosted by the Manila Times.

Besides reinvigorating the private sector, Dominguez said the government will step up the implementation of its “Build, Build, Build” program, given that a large part of the 2021 national budget has been earmarked for infrastructure modernization, which will be “the cornerstone of our economic recovery.”

The wider rollout of this centerpiece program of the Duterte administration will be sustainably funded by revenue collections this year that are expected to dramatically improve with the digital transformation initiatives being undertaken by both the Bureaus of Internal Revenue (BIR) and of Customs (BOC), Dominguez said.

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