Foreign groups back steps vs virus

By Jenina P. Ibañez, Reporter

FOREIGN business groups are backing government measures to address the coronavirus disease 2019 (COVID-19) pandemic and support the economy.

American Chamber of Commerce of the Philippines (AmCham) Senior Adviser John Forbes said that the special powers granted to President Rodrigo R. Duterte permits the “aggressive” spending they support to address the pandemic.

“AmCham supports strong monetary and fiscal policies to support the macroeconomy,” he said in a mobile message on Wednesday.

President Rodrigo R. Duterte on Wednesday signed a bill that grants him emergency powers to deal with the pandemic, including the ability to realign savings from the 2020 budgets of government agencies under the Executive branch.

AmCham is one of 32 business groups, including seven foreign chambers, that called on the government last week to pass the “maximum fiscal response” to address the pandemic.

The business groups’ recommendations include funds to support workers affected by the quarantine and temporary hospitals, as well as subsidies for the transport and tourism industries.

The emergency powers granted to Mr. Duterte include the ability to take over some operations of private hospitals and public transportation for front liners, speed up test kit approval, lower lending rates and reserve requirements for banks, regulate fuel, power and water distribution, and offer cash aid to low income households.

Mr. Forbes noted a focus of government programs on the needy, and supported work on saving public health, preserving economic health, and protecting jobs.

“Only time will tell if it is enough,” he said.

Nabil Francis, president of the European Chamber of Commerce of the Philippines (ECCP), said in a mobile message that the chamber supports the president’s emergency powers, provided that the powers are not “too sweeping and overreaching.”

He said the powers must be limited throughout the heath crisis, and remain consistent with constitutional safeguards.

“There may also be some lessons to be drawn from the good practices of other countries in terms of economic relief support.”

Mr. Francis referred to Malaysia and Italy, which have targeted subsidies in health, transport and tourism, and Germany’s increased public investment spending.

Germany plans to increase borrowing by up to $160 billion and pass a $167-billion supplementary budget, reports said. The German government is increasing subsidies for work schemes, and is putting up funds for small businesses.

The foreign chambers in the Philippines support the monetary stimulus from the Bangko Sentral ng Pilipinas (BSP).

BSP said it will buy P300 billion in government securities from the Bureau of the Treasury to support government programs to counter the economic impact of COVID-19. The BSP also cut the reserve requirement ratio of universal and commercial banks by 200 basis points to release more liquidity into the market.

“Like all central banks around the world BSP is acting quickly to support the economy. We are sure they will continue to assess the situation as matters develop,” British Chamber of Commerce of the Philippines Executive Director Chris Nelson said in a mobile message.

He said that it will take time to assess the impact of government measures responding to COVID-19, but noted that interested investors understand the global nature of the crisis.

“We are keeping them updated so that they will return quickly once the situation allows,” he said.