Review of the Growth Assumptions for FY 2021
August 18, 2021
The Development Budget Coordination Committee (DBCC) revised its growth assumptions for FY 2021 from 6.0 to 7.0 percent to 4.0 to 5.0 percent in light of the reimposition of stricter mobility restrictions in various areas of the country to effectively address the heightened risks brought about by the COVID-19 Delta variant.
In the first half of 2021, our careful balancing of COVID-19 and non-COVID-19 risks allowed us to improve GDP growth to 11.8 percent in Q2 2021. Without the present spike, the original growth target of 6.0 to 7.0 percent would have been achievable. However, with the global emergence of the Delta variant, the second half growth outlook was revised downwards to reflect the additional restrictions imposed by the government, which are necessary to curb its spread.
Our strategy is to continue managing the risks carefully by imposing granular quarantines, while allowing a vast number of people to earn a living. We will continue to use this period to accelerate the roll-out of the vaccination program. As of August 15, a total of 27.8 million doses have been administered, consisting of 15.2 million and 12.6 million for the first and second dose, respectively. Rest assured that we will continue to work closely with the local government units and the private sector to accelerate the country’s vaccination rates.
Last August 5, the country recorded an all-time high of 710,482 jabs in a day, while in the past week, the total average daily jabs reached more than 475,000. At this rate, and with recent vaccine deliveries arriving as scheduled, we are confident that we can inoculate the required number of individuals, particularly in the densely populated areas, by the end of 2021. We expect that this will significantly reduce the need for wide-scale quarantines, especially in key economic centers where the majority of Filipinos work. In this regard, the DBCC retained its growth targets for 2022 at 7.0 to 9.0 percent, and for 2023 and 2024 at 6.0 to 7.0 percent.
The DBCC will continue to monitor the effects of the Delta variant and the enforcement of community quarantines, and proactively manage the risks to help the economy recover.