The Philippines entered recession after registering the worst GDP contraction since the start of the surveys in the second quarter, according to figures announced Thursday, activity having been weighed down by the impact of the coronavirus.
Gross Domestic Product (GDP) fell 16.5 percent in the second quarter compared to the same period in 2019, the Philippines Statistics Authority said. This decline, the largest recorded since surveys began in 1981, followed a 0.7% contraction in the first quarter.
For the archipelago, this is the first recession for three decades.
The outlook is bleak, with the official number of coronavirus cases this week surpassing 115,000, a figure that has quintupled since the first restrictions were relaxed in June.
“There is no doubt that the pandemic poses an unprecedented challenge for the economy,” said Karl Chua, who is acting as head of the Ministry of Socio-Economic Planning.
“But the Philippines is now in a much stronger position to face the crisis, which was not the case in past crises. “
More than 27 million people in Manila and four neighboring provinces, or about a quarter of the archipelago’s population, learned Sunday evening that the authorities had decided to reconfine 24 hours later, after the alarm call from associations of doctors, who warned the country was losing the battle against Covid-19.
But President Rodrigo Duterte, who reluctantly imposed this re-containment, warned his country could not remain closed forever.
“The problem is that we are out of money. I can’t give people food and money anymore, ”he said on Sunday evening.
The economic difficulties have been exacerbated by a drop in remittances made to the archipelago by Filipinos working abroad who normally return part of their wages to their families, which boosts consumption.
These remittances, normally one of the main factors of growth, fell 6.4% in the first five months of the year, compared to the same period last year, according to the Central Bank. And this because thousands of sailors, housekeepers and employees