Reopening to the World
Things are looking up. Step by step, the Philippines is opening up to foreign travelers and inching closer to the normal.
The Philippines reopened its borders to fully vaccinated international travelers beginning February 10 in what could be a shot in the arm to the ailing tourism industry. Tourists from 157 countries with visa-free arrangements with the Philippines can now visit our major destinations, as long as they are fully vaccinated.
The move is a reflection of the government’s growing confidence in the efficacy of anti-Covid-19 vaccines that are credited for preventing thousands, if not millions of deaths, from coronavirus infections around the world.
Essential travelers and overseas Filipino workers prior to the more liberal rules were allowed in the country as long as they agreed to undergo a quarantine period in hotels. The new rule scraps the need for quarantine stay at hotels if the travelers received two or more doses of authorized vaccines.
I hope the policy will revive the tourism sector, restore millions of jobs and ease the financial burden on thousands of hotel and resort operators across the country. This will also benefit the transport sector, including airlines, shipping companies, bus and taxi operators, as well as jeepney and tricycle drivers.
The freedom of mobility will bring more customers to business establishments, such as restaurants, souvenir shops, malls, and grocery stores, as well as service-oriented enterprises such as travel agencies, tour guides, salons, spas, and aesthetic facilities. In turn, more jobs will be generated and more income will circulate in the countryside.
Declining infections, hospitalization rate, and morbidity from Covid-19 encouraged the government to lift the ban on international travel. Active cases fell below the 100,000 mark starting February 9, as the number of recoveries far exceeded new infections for several days. If the trend continues through March, we may see active cases fall below 10,000. Such a manageable scenario may afford us much greater freedom of mobility and economic activities.
A switch to Alert Level 1 from Alert Level 2 is now more likely in March as we transition from a pandemic to an endemic mindset. Hopefully, the laxer rules will allow more schools to conduct physical classes, aside from the 28 institutions participating in the “pilot phase” of the program. This becomes possible with the inoculation of minors aged 5 to 11 against Covid.
We need to seriously consider the opening of schools and reducing the adverse impact of the two-year pandemic on the mental and emotional state of our student population. Hundreds of thousands of students finished their college education without setting foot on campus grounds in the past two years.
Hopefully, the inclusion of the pediatric population in the massive vaccination program of the government will eventually lead to the resumption of physical classes and restoration of jobs in the education sector.
The easing of restrictions on international travel, aside from boosting the domestic tourism industry, is also expected to attract foreign investments that were put on hold in the past two years. The approval of several reform measures, such as the amended Retail Trade Liberalization law and the amended Public Service Act, for one, may get the attention of major foreign companies looking at the most ideal sites in the Philippines for their operations.
The Philippines is now certainly an ideal location for foreign investments, given our rapidly growing domestic market, stable macroeconomic environment, and competitive labor cost.
There are signs that we have indeed returned to pre-pandemic economic levels. Among these are merchandise exports and imports, which reached a record $74.6 billion and $117.8 billion, respectively, last year.
The trade performance enabled the gross domestic product to expand by 5.6 percent in 2021, although this was not enough to offset the 9.6-percent contraction in 2020.
Another sign is the growing demand for electricity, which, unfortunately, may translate into a supply shortage in the coming months. We have to manage both the supply and demand sides of the power sector to avert the energy deficit. The opening of more business establishments will certainly add to the growing power requirements of the country.
Employment also improved, per the latest report of the Philippine Statistics Authority. While the unemployment rate slightly increased to 6.6 percent in December from 6.5 percent in November, the size of the labor force actually increased during the period.
Around 800,000 more Filipinos, according to a separate report by the National Economic and Development Authority, were able to find work as mobility restrictions were relaxed in December, bringing the net employment creation to 3.7 million above the pre-pandemic levels.
I share Neda’s optimism that the vaccination program and the reopening of more sectors of the economy would generate more and better jobs for the Filipino people.
Another encouraging indicator is the moderating inflation rate, which settled at 3 percent in January 2022, or within the government’s target range of 2 percent to 4 percent. This means that people’s income and purchasing power are not being eroded by commodity price fluctuations.
All these indicators point to an improving economy. We can sustain economic growth by continuing to practice minimum public health protocols to prevent another surge that may force us to close our borders again.
The light at the end of the tunnel is becoming more visible now. We just have to remain focused to overcome the few remaining hurdles.