the economic resiliency plan
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THE ECONOMIC RESILIENCY PLAN. Presented by RD Arturo G. Valero During the General Assembly of the Philippine Federation of Local Councils of Women (PFLCW), Inc. November 19, 2009, Top Plaza Hotel, Dipolog City. What is ERP. the country’s response to the global crisis - PowerPoint PPT PresentationTRANSCRIPT
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Presented by RD Arturo G. ValeroDuring the General Assembly of the Philippine Federation of
Local Councils of Women (PFLCW), Inc.November 19, 2009, Top Plaza Hotel, Dipolog City
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What is ERPthe country’s response to the global crisisaims to stimulate the economy also seeks to prepare the country for the
eventual upturna mix of government spending, tax cuts and
public-private sector projects
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Objectives of ERPEnsure sustainable growth and attain the
higher end of the growth targets; Save and create as many jobs as possible; Protect the most vulnerable sectors – poorest
of the poor, returning overseas Filipino workers, and workers in export industries;
Ensure low and stable prices; and Improve competitiveness in preparation for
the global economic rebound.
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Strategies for ERPImplement budget interventionsAccelerate spending for small infrastructure
projectsExpand social protection programSave and create jobsImplement off-budget interventionsOther measures
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Budget interventionsIncreased budget for departments in:
InfrastructureSocial protectionAgricultureHealthEducation
Maximize d personal services (PS) budgetMaximized MOOE
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Small infrastructure projectsFront-load resources for full and quick
spending Focus on projects that are:
quick-disbursinghigh impact labor intensive
Obligate at least 60 percent of spending program in the first semester
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Social protection programsP5.0B conditional cash transfers to cover
additional 321,000 poor householdsP1.0B to PhilHealth as full contribution to the
national insurance programP2.0B to TESDA to equip more Filipinos with
skills for income generationP1.97 B to the DOH to improve primary and
secondary hospitals
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Save and create jobs DOLE interventions for overseas Filipinos:
Monitor overseas labor market displacements Monitor contracts of job orders overseas Worker registration Redeployment services to other emerging labor
markets Identify and develop new market niches Repatriation assistance Expand livelihood/business formation programs Reintegration and business counseling Skills upgrading and retooling services
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Save and create jobsEarly warning system to know which firms
are likely to shut down or shed workersAlternatives to laying off workers:
shortened work shiftsmaximized vacation leavesrotating forced leaves
Comprehensive livelihood and emergency employment programs (CLEEP)
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Off-budget interventionsTapping resources of GOCCs and GFIs for large
infraEnhanced social security benefits to membersAccelerating spending for comprehensive and
integrated infrastructure program (CIIP), namely:Official development assistance National budget/general appropriations act National-local government cost sharing Public-private partnership/joint venture Corporate funds Proceeds from those mandated by law (i.e. EPIRA)
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Other measuresGovernment will ramp up its housing
programsExpand trade with China and West AsiaEncourage exporting firms to diversify,
innovate and upgrade products.
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Funding the ERP
P330B economic resiliency planP160B increase in the 2009 budgetP40B tax cuts for low and middle income
earnersP100B large infrastructure projects funded
GFIs, social security institutions and private commercial banks
P30B additional benefits to members by social security institutions
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Challenge for MSMEsFocus on basic consumer commoditiesCling on laborOperate just to weather the stormDevelop forward processing activitiesImprove on technology/processes
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Why basic commoditiesAntidote to recession: spendingNatural tendency in crisis: savingThere are basic necessities: people eatThings should be affordable
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Why focus on labor
Household income needs to be sustainedPurchasing power necessary for spendingEnhance money circulationAvert unrest
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Why operate for subsistence
To be able to offer affordable productsSustain demandSave jobs
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Why develop forward industries
Enhance value added of productsAvailable raw materialsSkills/technology likely available
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Why improve on technology
To enhance competitiveness To lower operating costsEnsure quality products
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Economic Resiliency Plan worked
GDP Q2 year-on-year growth of 1.5%, quarter-on-quarter growth of 2.4%
Public construction up by 29.9%Government consumption up by 9.1%Unemployment feared to rise due to the
crisis. It actually fell due to CLEEP: from 8.0% in April 2008 to 7.5% in April 2009
OF remittances still defy gravity
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Lay-offs down due to rehiring Workers Displaced by the Crisis
October 2008 4,224November 2008 9,448December 2008 11,433January 2009 12,392February 2009 9,126March 2009 15,895April 2009 2,554May 2009 1,776June 2009 1,590
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2009-2010 Growth Outlook
Indicator 2009 2010
GNP 2.1-3.1 4.7-5.6GDP 0.8-1.8 2.6-3.6
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Quote from Standard and Poor
“Yes, the Philippines is 'lucky' because they have made the necessary adjustments and reforms when times were still good. So they are facing the global market problems and economic slowdown from a considerably improved position, compared to what they were in 3-4 years ago…
“The Philippines is an 'island of calm' currently, while there is turmoil in the higher rated and previously stable countries… ”
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Thank you!