The Philippines has always prevailed through major challenges, from natural disasters to political uncertainties. However, the lingering socio-economic impact of the Covid-19 pandemic could strain the country’s much vaunted resilience now more than ever. Though still rocky, a path to recovery does lie ahead.
GDP growth significantly rebounded in the second quarter of 2021, surging 11.8% compared to the previous year, the highest growth in more than three decades. Among major sectors, manufacturing expanded by 22.3%, construction by 25.7%, and services by 9.6%. These figures have already brightened the economy’s full-year growth outlook despite some expected bumps due to the continuing spread of coronavirus variants. The government’s goal of vaccinating all adults—70% of the population—by the end of the year is crucial for the economy to sustain its growth trajectory. More than 42 million total vaccine doses have been administered so far.
Vaccine distribution may be uneven across the country, but in Metro Manila at least, the rollout seems to be proceeding briskly. The National Capital Region—which accounts for around 36% of the national economy—seems to be moving towards herd immunity. As of late September, almost 70% of the region’s target residents have been fully vaccinated, while almost 90% have already received their first dose.
The efforts of the private sector, such as global port management company International Container Terminal Services, Inc., have been instrumental in procuring and distributing the vaccines. SM Investments, the country’s largest conglomerate, provided free vaccines not only to its workforce, but also stakeholders and business partners, offering its properties as vaccination and testing hubs.
Prudent financial policies and vital reforms are expected to clear the way for further recovery, with growth expected to pick up by the last quarter of 2021 and into next year. With several high-impact infrastructure projects slated for completion in 2022, job opportunities are bound to expand and the country’s competitiveness will improve. These are also supporting the appreciation of real estate values in major cities, providing investors with unprecedented opportunities. Rebounding exports and remittances, and increased spending ahead of next year’s general elections, are also expected to boost domestic consumer demand.
The increasing adoption of digital technology and online transactions has greatly accelerated over the past year, boosting efficiency and the ease of doing business. Growth has now been more decentralized, with the government focusing on decongesting the capital and stepping up digitalization initiatives to sustain economic activity. Indicators point to a Philippines that will bounce back better, with more inclusive and sustainable growth, supported by robust infrastructure, and a resilient population that’s more digitally savvy.