THE National Economic and Development Authority (Neda) thinks the government should ease certain regulations to allow firms to manage their costs in light of the disruptions caused by coronavirus disease 2019 (COVID-19).
In a statement, Socioeconomic Planning Secretary Ernest M. Pernia said this involves cutting red tape and extend financing options to micro and small enterprises who may already been affected by the virus.
“In consultation with the private sector, the government should ease implementation of some regulations that will allow firms to manage costs and provide financing or loan restructuring to micro and small enterprises whose operations may have already been affected,” said Pernia.
Pernia cited measures that were instituted to remove administrative constraints for the importation of agricultural products under Administrative Order 13, Series of 2019.
These include streamlining procedures and requirements in the accreditation of importers, and minimizing the processing time of applications for importation.
The list also includes providing exemptions to already-accredited traders from registration requirements and reducing transaction fees and cargo fees for a limited period. Pernia said relevant government agencies may institute similar measures.
Pernia said the Anti-Red Tape Authority (Arta) may also help businesses lower their cost of production by fast-tracking the review of procedures of certain crucial agencies.
This includes the Food and Drug Administration of the Philippines, to allow
the introduction of new and innovative products to the domestic and export
Pernia said the government, in coordination with exporters, can also facilitate the identification of new sources and markets, as well as diversification of its products to manage vulnerabilities.
“In the longer term, emphasis must be placed on developing backward and forward linkages that will encourage production of raw materials and intermediate inputs—as well as onward processing to finished products—in the domestic market, to reduce reliance on foreign suppliers,” Pernia said.
On Tuesday, economists said the worst is yet to come for the country’s external trade performance as the latest data may not yet reflect the disruptions caused by coronavirus disease 2019 (COVID-19) on global value chains (GVCs).
The country’s export revenues grew 9.7 percent to $5.79 billion in January 2020, according to the Philippine Statistics Authority (PSA). Data also showed import receipts inched up by 1 percent to $9.29 billion in January 2020.
Economists, like former University of the Philippines School of Economics Dean Ramon L. Clarete, said the economy, in general, may be in for a deep dive given the uncertainties of the situation. But for now, the economy is still living on borrowed time.
Clarete explained the country’s external trade performance is facing an uphill battle given the uncertainties surrounding COVID-19.
He said the current crisis is even worse than the Global Economic Crisis of 2008-2009. While the GEC stemmed from the disruption of financial flows, the current slowdown in trade is a health-related crisis. There are cases where factory workers are prevented from coming to work because of health restrictions to contain COVID-19.
Action for Economic Reforms (AER) Coordinator Filomeno Sta. Ana III also said earlier that COVID-19 has caused the breakdown of supply chains, and dampened the confidence of consumers and investors. It will not be addressed by a simple stimulus.