Domiguez thumbs down passage of Bayanihan 3; says economy just waiting for fear factor to be removed

December 4, 2020

Finance Secretary Carlos Dominguez III has rejected a move for the passage of Bayanihan 3 bill, citing the still unspent budget and the "tight" fiscal situation.

In a virtual press conference after the Development Budget Coordination Committee meeting on Thursday, Dominguez said the deficit for next year is already pegged at 8.9 percent.

"So, that leaves us a very, very tight fiscal situation. So, at this point in time, we cannot say that we are supporting another Bayanihan 3 bill," he said.

Dominguez noted that the government has unspent budget under this year's General Appropriations Act and the Bayanihan 2.

"So, that is additional P213 billion, if I'm not mistaken. That could be the stimulus for next year," the Finance chief added.

Some lawmakers have brought up the idea of passing a Bayanihan 3 to assist the victims of recent typhoons.

Despite the coronavirus pandemic, Dominguez also explained that the "productive capacity" of the Philippines has not been damaged.

"What has limited us is the fear of getting infection....our economy is hobbled because of restrictions on mobility so that people don't get sick," he said.

He said the factories and call centers, which are factors of production, are not damaged by the pandemic.

"We also have a very young population. Our average is about 24 years old. We have also restricted the movement of the young people. When you restrict the movements of the young people, that is 40 percent of our people, so you are reducing their demand. But the productive capacity, the educated people, the infrastrucutre, we are continuously building, is there. So, the economy is just waiting for this fear factor to be removed, for people to have more confidence that they will not get sick and this economy, believe me is going to boom," he added.

The DBCC has projected the Philippine economy to bounce back to positive growth in the next two years after a contraction this year.

From the projected contraction of 8.5 to 9.5 percent on the GDP for this year, according to the economic team, the economy could expand to 6.5 to 7.5 percent in 2021 and 8 to 10 percent in 2022. Celerina Monte/DMS