COURSE:

ECONOMIC DEVELOPMENT
 ECONOMIC DEVELOPMENT

Overview of real-world Economics showing newspaper headlines, showing how it impacts their lives,
even showing macroeconomic things which will not be covered in this course
Video Clip: Philippines plunges into recession as economy shrinks 16.5% in Q2
 HEADLINE:
PHILIPPINE ECONOMY TO DECLINE FURTHER IN 2020
AMID COVID-19, WITH RECOVERY IN 2021,
News Release | 15 September 2020
MANILA, PHILIPPINES (15 September 2020) — The Philippine economy is
forecast to contract by 7.3% in 2020 amid the coronavirus disease (COVID-19)
pandemic before growth returns to 6.5% in 2021, according to a new report
from the Asian Development Bank (ADB) released today.
The economy is expected to rebound in 2021 as the outbreak is contained, the
economy is further opened, and more government stimulus measures are
implemented. Downside risks next year include a slower than expected global
recovery that could weigh heavily on trade, investment, and overseas Filipino
worker remittances.
 HEADLINE:
PHILIPPINE ECONOMY TO DECLINE FURTHER IN 2020
AMID COVID-19, WITH RECOVERY IN 2021,
News Release | 15 September 2020
“We believe the worst is now over and that the contraction in GDP bottomed out in
May or June this year. The package of measures the government rolled out such as
income support to families, relief for small businesses, and support to agriculture in the
second quarter all helped the economy to bottom out. We expect the recovery to be
slow and fragile for the rest of this year, and growth to accelerate in 2021 on the back
of additional fiscal support and an accommodative monetary policy stance,” said ADB
Country Director for the Philippines Kelly Bird.
“ADB has thrown its full support to the government’s COVID-19 response, delivering
a combination of loans and grants to help finance measures aimed at lessening the
pandemic’s impact on lives and livelihoods,” he said.
 HEADLINE:
PHILIPPINE ECONOMY TO DECLINE FURTHER IN 2020
AMID COVID-19, WITH RECOVERY IN 2021,
News Release | 15 September 2020
ADB has so far provided about $2.3 billion in loans and grants to support the government’s
urgent COVID-19 response, including social protection and livelihood support to help mitigate
the impacts on livelihoods and employment and assistance to further scale up the government’s
health response against the pandemic.
Following a contraction of 9.0% in the first half of 2020, a slow economic recovery is expected
to start in the second half of 2020, as the government’s fiscal response gains traction and
household consumption slowly picks up on a job rebound. Following the relaxation of
community quarantines in June, the employment situation in July improved markedly from
April. The services sector was the main job creator with 3.4 million jobs added between April
and July, followed by the agricultural and industrial sectors, with 2.1 million and 2 million,
respectively. Consequently, the unemployment rate fell from 17.7% in April to 10.0% in July.
The government is preparing an additional fiscal support package to be
implemented in September which is expected to include cash subsidies to poor
households; support for displaced workers and critically affected sectors such as
agriculture, tourism, and transportation; and relief to the health care system,
among other measures. Such measures will have high multiplier effects and
keep the economy on track to recovery next year.
The report revised the Philippines’ inflation forecasts to 2.4% in 2020 and 2.6%
in 2021, compared with the April projections of 2.2% and 2.4%, respectively, as
global oil prices stabilize. The forecasts are within the Philippine central bank’s
target range of 2.0%–4.0%, with monetary policy likely to continue to help the
economy’s rebound from the pandemic.
ADB is committed to achieving a prosperous, inclusive, resilient, and
sustainable Asia and the Pacific, while sustaining its efforts to eradicate extreme
poverty. Established in 1966, it is owned by 68 members—49 from the region.
 HEADLINE:
PHILIPPINE ECONOMY TO DECLINE FURTHER IN 2020
AMID COVID-19, WITH RECOVERY IN 2021,
News Release | 15 September 2020

IMPACT:
Video Clip: Leptospirosis cases spike after 'Ulysses'
HEADLINE:
INFLATION STILL WITHIN GOV’T TARGET IN OCTOBER 2020,
News Release | 05 November 2020

The country’s inflation continued to settle within target in October 2020, though
upside risks such as the adverse impact of inclement weather and the lingering
presence of the African Swine Fever (ASF) remain, the National Economic and
Development Authority (NEDA) said.
The Philippine Statistics Authority reported today that the country’s headline
inflation inched up to 2.5 percent in October from 2.3 percent in September 2020,
bringing the year-to-date inflation to 2.5 percent.
This is still within the central bank’s inflation target of 2 to 4 percent for the year.
HEADLINE:
INFLATION STILL WITHIN GOV’T TARGET IN OCTOBER 2020,
News Release | 05 November 2020
Latest projections from the Department of Agriculture (DA) show that the supply of key
food products is likely to remain sufficient until the end of the year. However,
agricultural damage may put food supply at risk, and thus put pressure on prices.
“A key strategy for food security and food price stability during uncertain times is to
prolong the shelf life of agricultural goods. This may come by way of introducing proper
technology and increasing investments in warehouses and cold storage facilities in
strategic locations,” the NEDA chief said.
He also emphasized the need for the government and the private sector to tap local
producers in nearby provinces or regions to make up for the lost harvest in disaster-
stricken areas.
HEADLINE:
INFLATION STILL WITHIN GOV’T TARGET IN OCTOBER 2020,
News Release | 05 November 2020

“Relief efforts in heavily affected areas are being prioritized. NEDA, meanwhile,
has been participating in post-disaster needs assessment led by the Office of Civil
Defense. We will provide an analysis of the effects of the disasters on various
sectors, including macroeconomic impact.” Chua added.
Furthermore, Chua said that support to the agriculture sector is also needed due to
the continued presence of ASF in the country, which has resulted in tighter supply
and higher prices of pork in Luzon.
“The government will strictly implement biosecurity measures and food safety
protocols to curb the spread of animal diseases in farms and guarantee safe
consumption of meat products,” he added.
HEADLINE:
INFLATION STILL WITHIN GOV’T TARGET IN OCTOBER 2020,
News Release | 05 November 2020

IMPACT:
Video Clip: Transport officials lay down solutions to RFID issues
HEADLINE:
RICE TARIFFICATION BENEFITS ALL FILIPINOS, ENHANCES PRODUCTIVITY AND
COMPETITIVENESS OF RICE SECTOR – NEDA, News Release | 10 October 2020

MANILA – The Rice Tariffication Law (RTL) benefits all Filipinos. At the same time, it
enhances productivity and overall competitiveness of our country’s rice sector.
“When the government began its campaign to reform the rice sector, the goal was to
improve food security for all and give rice farmers better support,” Acting
Socioeconomic Planning Secretary Karl Kendrick Chua said. “We want to ensure that all
110 million Filipinos will be able to afford rice, especially the poor who spend as much
as 30 percent of their food budget on rice, and to ensure rice farmers have better means to
improve productivity through better seeds and equipment.”
HEADLINE:
RICE TARIFFICATION BENEFITS ALL FILIPINOS, ENHANCES PRODUCTIVITY AND
COMPETITIVENESS OF RICE SECTOR – NEDA, News Release | 10 October 2020

Chua emphasized that the old QR (Quantitative Restriction) regime did not
succeed in providing affordable rice for all Filipinos, noting that prior to RTL,
consumers paid double compared to our neighboring countries for a kilo of rice.
Before RTL was enacted, the Philippines repeatedly applied since 1995 to extend
the Quantitative Restrictions or QR on the importation of rice. “That is almost 25
years. That is how long Filipinos have been overcharged for rice and how long we
have kept the rice sector from growing,” Chua explained.
“Gone are the days when the Philippine rice trade is under the control of just a
few importers who were granted the import permits. Rice now abounds in the
retail markets at more competitive price levels,” he said.
HEADLINE:
RICE TARIFFICATION BENEFITS ALL FILIPINOS, ENHANCES PRODUCTIVITY AND
COMPETITIVENESS OF RICE SECTOR – NEDA, News Release | 10 October 2020

“But more than price benefits, the RTL has expanded the availability of different rice types and
varieties in the local market, providing consumers a wider range of choices, depending on their
budget and quality preference,” Chua added.
More importantly, it was estimated that the RTL, by 2025, would reduce the proportion of
malnourished children and population at risk of hunger in the country by 2.8 percent and 15.4
percent, respectively. This is equivalent to around 2.1 million less people at risk of hunger and
malnutrition.
In anticipation of the possible adverse effects as part of this reform, Chua said that the government
provided safeguards to protect rice farmers during the transition period.
These include the Rice Competitiveness Enhancement Fund (RCEF) with a guaranteed budget of
10 billion pesos per year for six years, or a total of 60 billion pesos and the implementation of the
Rice Roadmap of the Department of Agriculture. The RCEF also provides support for capacity
building for rice farmers to enable them to modernize and innovate.
HEADLINE:
RICE TARIFFICATION BENEFITS ALL FILIPINOS, ENHANCES PRODUCTIVITY AND
COMPETITIVENESS OF RICE SECTOR – NEDA, News Release | 10 October 2020

Chua said the Philippines generally does not have a natural comparative advantage in rice
production, compared with neighbors like Thailand, Vietnam and Myanmar which all have large
flat plains, fewer or no typhoons, less history of land inequality, and access to the Mekong River
system, which serves as a great source of natural irrigation, as well as far lower population growth
rates.
“With the help of production support from RCEF, highly competitive farmers can bring down the
production cost to as low as 5 to 6 pesos per kilo, or roughly the same cost that our neighbors are
able to produce at,” according to the NEDA chief.
“Rice tariffication is a game changer,” Chua said, adding that the benefits of RTL, like any reform,
may not be immediate, but they are clearly starting to show.
“Like any investment, let’s give the law some time to fully realize its long-term gains. We
encourage everyone in the rice sector to help us and give information to our implementing and law
enforcement agencies regarding uncompetitive trade practices of private traders,” Chua said.
HEADLINE:
RICE TARIFFICATION BENEFITS ALL FILIPINOS, ENHANCES PRODUCTIVITY AND
COMPETITIVENESS OF RICE SECTOR – NEDA, News Release | 10 October 2020

IMPACT: