Covid projected to cost Philippines over $730bn in next 10-40 yrs
Manila – The National Economic and Development Authority (NEDA) of the Philippines said that the long-run cost of the Covid-19 pandemic to the country would reach 37 trillion pesos ($730 billion) in the next 10 to 40 years.
“Broken down, in 2020, we lost 4.3 trillion pesos; in the next 10 to 40 years, we estimate that we will lose up to 37 trillion pesos,” Socioeconomic Planning Secretary Karl Kendrick Chua said in a statement on Saturday.
Chua added that consumption and investment are likely to be lower in the next 10 years due to the reduced demand in sectors that require social distancing, such as tourism, restaurants, and public transportation, reports Xinhua news agency.
Consequently, tax revenues will be lower if businesses cannot operate at 100 per cent.
The head of the government agency responsible for economic development planning said the estimated total loss due to lower consumption is 4.5 trillion pesos.
Meanwhile, the loss in private investment and returns in the same period is around 21.3 trillion pesos.
“We expect the economy to converge to the pre-pandemic growth path by the 10th year. While we will recover to the pre-pandemic level by the end of 2022 or early 2023, it will take several more years before we converge to our original growth path,” Chua said.
Another key finding of the NEDA study is that workers’ productivity will also be lower due to untimely death, illness, and lack of face-to-face schooling.
“The impact on productivity is likely to be permanent over the next 40 years or the average number of years a person is expected to work in his or her lifetime,” Chua said.
Citing a NEDA study, Chua said the resulting productivity loss in human capital investment and returns is estimated at 15.5 trillion pesos for the next 40 years.
The Philippines has been under varying degrees of lockdown measures since mid-March 2020.
Despite its longer and stricter lockdown, the Southeast Asian country is still grappling with surging Covid-19 infections, which has so far totalled to 2,470,235, with 37,405 deaths.