The year 2020 was a great disruption that reversed the Philippine economy’s growth with a full-year contraction of 9.5 percent, the country’s worst economic performance in 73 years. This was also the steepest decline recorded in Southeast Asia last year.
Likewise a record was the country’s annual unemployment rate in 2020, which jumped to 10.3 percent, translating to around 4.5 million jobless Filipinos, the highest recorded annual unemployment rate since April 2005. As millions lost their jobs and experienced involuntary hunger, the private sector quickly mobilized to provide assistance, especially to the most vulnerable sectors affected by the lockdowns. Equally important, the private sector significantly contributed to the extensive improvement of the country’s quarantine and testing capacities. This year, it will be with the support of business groups that millions of the Filipino workforce will gain access to COVID-19 vaccines.
The year 2020 highlighted the government’s health care response to the pandemic. However, the years 2021-2022 will be defined by the economic response to the damage inflicted by the crisis.
Through the private sector’s collective efforts in mitigating the socioeconomic impact of the COVID-19 crisis, pandemic challenges could be transformed into opportunities by boosting investments and creating new jobs and livelihoods needed to alleviate poverty, reduce inequality, and mitigate other economic insecurities. A survey conducted by Pulse Asia in September last year found that 85 percent of Filipinos agree that the government should engage with the private sector in order for the economy to recover faster.
Last March 26, the Stratbase ADR Institute had a virtual roundtable discussion on the role of the private sector as a reliable partner to government in economic recovery. Ayala Corp. chair Jaime Augusto Zobel de Ayala said that the strengths of the private sector—its resources, ingenuity, and performance management discipline—are crucial in augmenting the government’s massive machinery, and can even co-develop new ways to deliver critical aid and other forms of support to stakeholders.
“I sincerely believe that the private sector is a force for growth and a force for good. And if we continue to put our collective resources and determination to task, we will be able to force-multiply the growth and the good that we contribute to nation-building,” said Zobel de Ayala.
Stratbase ADR Institute chair Albert del Rosario stressed that since we are all living in a complex and synergistic world, the biggest lesson is to keep a balance between our health and the environment to sustain the economy. The only way the country can do this is if we work as one whole society.
In 2021 and beyond, the private sector will be key to creating a more sustainable and inclusive economic recovery through eight strategic initiatives: 1) Creating jobs that will ensure livelihood and address the ever-widening inequality in society; 2) Closing the digital divide by accelerating digital transformation; 3) Incorporating environmental, social, and corporate governance principles into business operations to address climate change and social inequalities; 4) Helping strengthen the country’s fragmented health system; 5) Engaging in public-private collaborations driven by public interest; 6) Promoting stakeholder capitalism that can lead to a more inclusive recovery; 7) Creating more opportunities for all, such as quality education and social protection; and 8) Demanding transparency and accountability in governance and encouraging an entrepreneurial state made up of “smart” local governments.
The shared prosperity that the private sector can offer and provide will be crucial in uplifting the lives of Filipinos, accelerating the country’s economic momentum, and helping rebuild the nation toward a more sustainable, inclusive, and resilient future.
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Dindo Manhit is the founder and managing director of Stratbase Group.