Business activities picking up — DOF

by Mary Grace Padin (The Philippine Star), 13 Aug 2020

MANILA, Philippines — Some industries have experienced a pickup in business activities following the slight easing of movement restrictions in Metro Manila and other urban centers in June, according to the Department of Finance (DOF).

In a series of meetings with the private sector in the third week of July, Finance Secretary Carlos Dominguez and other members of the government’s economic team sought updates on the status of business operations, as well as industry recommendations on how the government could help restore consumer confidence in the country.

According to the DOF, private sector leaders reported a resumption in construction activities, with one major property developer slowly restarting 78 projects. Another conglomerate has reported that its infrastructure investments remain on track.

The DOF said mall owners in areas under general community quarantine and modified general community quarantine saw foot traffic returning to 24 to 30 percent of regular operations.

However, sales were still sluggish in June, with purchases consisting mostly of food, household items and gadgets.

In June, real estate businesses reported an increase in the sale of residential units of up to 60 percent, the DOF said.

Land developers said business process outsourcing (BPO) companies have asked for additional office space for their employees, in accordance with physical distancing and other health and safety protocols.

Meanwhile, the DOF said the telecommunications, water and energy sectors expect positive sales growth this year despite the pandemic.

“Most firms reported that they have begun to see a gradual sales recovery in June, coinciding with the partial reopening of the economy under GCQ, and expect a slow

reduction of losses in the coming months, after the end of the MECQ (modified enhanced community quarantine) on August 18,” the DOF said.

In addition, the agency said a major private sector lender also reported an increase in consumer loans except for automobile loans, and a surge in loan demand mostly from large firms.

Hotel operations have resumed in areas under GCQ and MGCQ, but still remain limited for long-staying guests, returning overseas Filipinos and stranded passengers.

The DOF said one major fast food chain has reopened 93 percent of its stores nationwide, but sales have remained below normal because of existing mobility restrictions.

Port operations, meanwhile, have reached a 60 percent utilization rate as of June.

The finance department also said liquor sales increased by 34 percent in the first half despite the lockdown and higher excise taxes imposed starting in January under the new Sin Tax Reform Law.

Meanwhile, the DOF said private sector leaders called for the easing of transportation restrictions, subject to health and safety protocols, to allow the movement of more workers and consumers.

They said the fourth quarter is a crucial period to shore up demand and consumer confidence.