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'Unprecedented' Lockdown of Manila Expected to Cut Philippine Economic Growth

Ralph Jennings

   TAIPEI, TAIWAN - A lockdown of Metro Manila to contain a coronavirus
   outbreak in the Philippines will cut national economic growth that
   depends largely ontheflow of people through the 13 million-person
   capital and its suburbs, analysts say.

   President RodrigoDuterteordered last week that the National Capital
   Region be sealed off from March 15 through April 14. The order came
   after officials discovered local transmission of the deadly virus that
   has infected people in 125 countries over the past two months.

   Land, air and sea travel will stop during the lockdown month and anyone
   entering the metro area for work from its farther-flung suburbs must
   show proof of employment, according to official documents and people
   living in Manila.

   The lockdown will set back GDP growth this year by 0.3% to 0.5%, said
   JonathanRavelas, chief market strategist with Banco de OroUniBank.

   The Southeast Asian country initially forecast by the Asian Development
   Bank to grow 6% this year depends heavily on consumer spending, which
   is growing because of job creation on the back of new investments in
   factories, infrastructure and call centers. Officials hope GDP growth
   will help ease poverty that afflicts one in five Filipinos.

   Many inbound workers lack company ID cards, sources in Manila say. They
   say malls are supposed to shutter and erode the income of people who
   work there.Dutertehimself encouraged younger people to stay home.

   "If people can't get to work, then they can't get paid," said Christian
   de Guzman, vice president and senior credit officer with Moody's
   Sovereign Risk Group. "That has a feedback loop into the confidence
   effect and what it means for consumption."

   Countries such as China and Italy, which have many morecoronaviruscases
   than the 140 reported by the Philippines as of March 15, also declared
   mass lockdowns. In most of the world, however, lockdowns apply to
   communities with sudden or uncontrolled outbreaks.'¯

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