More news about how the COVID-19 pandemic in the Philippines is being handled by the public and the government.
Filipinos are so resilient that 1 in 2 feel better off than before the pandemic. That is a higher average than any other country in the world.
Almost half or 49 percent of Filipinos say they are better off economically than they were before the pandemic, reflecting a positive sentiment that is higher than the global average of 33 percent.
This is one of the findings of the report entitled “Cost of Living Monitor” by market research company Ipsos which covered 32 countries, including the Philippines, to examine how the public feel about their finances and the economy.
The study involved online interviews of 22,720 respondents, 500 of whom are from the Philippines. Data were collected between Oct. 25 and Nov. 8, 2024.
Findings show that 17 percent of Filipino respondents said they are “much better off” and 32 percent said they are “a little better off.”
Also, 25 percent said they were “neither better nor worse off,” 17 percent said they are “a little worse off,” and 7 percent said they are “much worse off.”
“Thirty-seven percent across 32 countries say they are worse off than before the pandemic, and this figure rises to 43 percent for G7 countries,” a statement from the company said.
Despite the much better view in the Philippines, 80 percent of Filipino respondents said they expect the inflation rate to rise over the next year.
“Two-thirds (65 percent) think the rate of inflation will increase in their country in the next 12 months. This figure is up seven percentage points since April and this is the highest figure we’ve recorded since November 2022,” the company said, citing the less pessimistic global sentiment.
However the same survey says 80% of Filipinos believe inflation will rise over next year. Seems that resilient happy attitude is just a cover.
Everyone knows the lockdowns destroyed the economy. Especially the economic managers who are predicting slow growth to continue.
PHILIPPINE ECONOMIC growth could weaken further next year, falling short of the government’s target amid an incomplete post-coronavirus disease 2019 (COVID-19) fiscal consolidation and still high interest rates, analysts said.
Pantheon Macroeconomics in its Emerging Asia Outlook report said it expects a “continued slowdown” in growth next year. It expects the economy to grow 5.4% this year and slow to 5.2% in 2025.
These are both well below the government’s 6-6.5% and 6-8% targets for 2024 and 2025, respectively.
The Philippine economy grew 5.2% in the third quarter, weaker-than-expected and the slowest in five quarters.
“Surveys show that a slowing rebuild of household savings in the Philippines from COVID and a cost-of-living crisis damage cushioned the slump in consumption growth this year, albeit at the likely expense of delaying a real recovery in GDP (gross domestic product) growth,” Pantheon said.
It added that the country’s economic output would “remain hampered by incomplete post-COVID fiscal consolidation and historically tight monetary policy.”
ANZ Research in its latest quarterly report said it expects economic growth to slow to 5.6% in 2025 from 5.7% this year. It said its outlook for 2025 is “downbeat, complicated by the lack of domestic growth catalysts amid fading exports.”
Consumer confidence has remained static and below pre-pandemic levels in most economies in Asia, it pointed out.
“Consumer surveys in both Indonesia and the Philippines suggest a fall in household savings over the last few years.”
The Institute of International Finance said it expects Philippine growth to average 5.8% this year and in 2025.
“Countries that are more reliant on dollar financing such as Malaysia, Korea and the Philippines are likely to face increased pressure from a strong US dollar and ‘higher-for-longer’ US Fed Funds policy rate,” it said.
The peso sank to the P59-a-dollar level twice last month, hitting a record low on Nov. 21 and Nov. 26.
“The Philippines, in particular, stands out due to its higher external financing needs, given its larger twin current account and fiscal deficits,” the institute said.
Meanwhile, both Pantheon and ANZ expect inflation to settle at 3.2% this year, compared with the Bangko Sentral ng Pilipinas’ (BSP) 3.1% estimate.
The central bank is also expected to continue its rate-cutting cycle next year. ANZ expects the policy rate to end at 5.75% this year and 5% by end-2025.
“Real rates are likely to stay elevated in Indonesia, South Korea and the Philippines where 50-to-100-basis-point (bp) rate cuts are likely in 2025,” it said.
“The efficacy of rate cuts in Indonesia and the Philippines will be limited by the need to rebuild household savings,” it added.
Pantheon also expects the key rate to end at 5.75% this year but sees it falling further to 4.75% by the end of next year.
The Philippine central bank started its easing cycle in August with a 25-bp rate cut. It delivered another 25-bp cut in October, bringing the key rate to 6%.
The Monetary Board will hold its final policy review of the year on Dec. 19.
BSP Governor Eli M. Remolona, Jr. earlier signaled the possibility of another 25-bp cut at the meeting.
If everything in that analysis is true (a slowing rebuild of household savings in the Philippines from COVID and a cost-of-living crisis damage cushioned the slump in consumption growth this year, albeit at the likely expense of delaying a real recovery in GDP growth) then why do 1 in 2 Filipinos think they are better off now than before the pandemic?
Medical inflation is predicted to rise next year as well.
The health maintenance organisation (HMO) sector in the Philippines chalked up losses of PHP4.269bn ($75m) in 2023, nearly triple the losses of PHP1.433bn in 2022, due to a substantial increase in claims and benefits paid, says a report released by WTW, a leading global advisory, broking and solutions company.
WTW, in its Global Medical Trends Survey report, states that medical claims frequency has significantly rebounded, now surpassing the pre-pandemic levels of 2019, with the cost per claim rising primarily due to higher costs of medical services and procedures.
In response to the increased losses, the HMO sector has adjusted its pricing assumptions annually to address the continuous increase in utilization trends, with 15% to 18% medical inflation assumptions over the past three years. Factors affecting medical inflation include rising hospital and clinic costs, increased professional fees and a higher frequency of diseases.
Although reports indicate that HMOs are recovering in the first half of 2024, ongoing negotiations between two HMO associations and various doctor groups regarding a potential 80% to 150% increase in professional fees are still driving the projected double-digit medical inflation for 2025.
The Department of Tourism has been hopeful about arrivals returning to pre-pandemic levels but now their timeline has shifted to 2027.
The Philippines will likely fall short of its tourism target, with visitor arrivals expected to return to pre-pandemic levels only by 2027 at the earliest, due to the slow recovery in travelers from China—a key source of tourists—according to Leechiu Property Consultants.
“Pre-pandemic arrivals are still somewhat distant from today’s levels,” said Alfred Lay, director for hotel, tourism, and leisure. “We expect full recovery to be in 2027. We were hoping it would happen a little earlier.”
Citing the slow recovery in China’s travel market, Lay said the Philippines will likely see a tempered 10% annual growth in tourist arrivals from around 6 million this year through 2028, when he expects 8.5 million arrivals. He estimates 7.8 million arrivals in 2027, far below the government’s 12 million target.
“COVID has cost us eight years of tourism growth,” Lay said. “Without COVID, we may have already surpassed the 10 million mark. But unfortunately, that is not the case, and many countries across Southeast Asia are still battling just to return to pre-COVID levels.”
Even with arrivals from South Korea and other major markets continuing to increase, Lay estimates that the earliest the country will see a return to pre-pandemic traffic of 8.2 million visitors will be between 2027 and 2028, assuming traffic from China remains subdued.
The decline in Chinese tourist arrivals—from 1 million in 2019 to fewer than 244,000 in 2024—”remains a significant challenge, and other source markets have yet to fully compensate for this shortfall,” Lay said.
Nevertheless, confidence in the Philippine hospitality sector remains high, with continued government and private sector investment in the industry in anticipation of an eventual recovery to pre-pandemic levels, Lay added.
The privatization and expansion of airports, the VAT refund system for foreign tourists, and the opening of new hotels and resorts “underscore this optimism, setting the stage for a promising 2025,” he said.
Interesting that China is the main source of tourist arrivals. Why is the DOT wasting time wooing Europe when they should be wooing back the Chinese?
The DepEd budget has been cut and teachers are saying this "will widen the digital divide among students and exacerbate the learning crisis following the COVID-19 pandemic."
Department of Education Secretary Sonny Angara and teachers’ groups have decried Congress’ decision to cut the DepEd’s 2025 budget by P12 billion.
“Sad to learn that both houses of Congress have decided to decrease by P12 billion the budget the President proposed for DepEd for 2025. This reverses a trend in recent years where Congress added even more to the education budget, save for one year during the pandemic,” Angara on Thursday posted on X, formerly Twitter.
The bicameral conference committee on Wednesday reduced to P737 billion, from P748.65 billion, the DepEd’s 2025 funding allocation in the reconciled version of the General Appropriations Bill (GAB).
Of the amount cut, P10 billion will be slashed from the DepEd’s computerization program, which aims to provide public schools with gadgets, equipment, software and training for teachers and students.
“Infrastructure is important, but so is investing in our people and human capital. The digital divide will widen,” Angara lamented.
“Those who do not have computers will find it hard to catch up,” he said yesterday on the sidelines of his visit to public schools in Iloilo City.
The DepEd will explore partnerships with the private sector and non-government organizations to provide technology to public schools, Angara said.
Of the P6.352-trillion national budget for 2025, P1.1 trillion will be allocated to the Department of Public Works and Highways.
“Investing in infrastructure is very important, that’s why we have increased the funds of different agencies in relation to this,” Sen. Grace Poe said in her sponsorship speech before the bicam approved the GAB’s reconciled version.
Poe pointed out that despite the budget cut, the DepEd’s 2025 budget increased from this year’s P715.3 billion.
The utilization rate of the computerization program is at 50 percent in 2023 and 11.92 percent as of June 2024, Poe said, citing the Commission on Audit report.
The DepEd budget for teaching supplies allowance has been doubled, from P4.825 billion in 2024 to P9.948 billion next year, she noted.
The Teachers’ Dignity Coalition said the budget cut will widen the digital divide among students and exacerbate the learning crisis following the COVID-19 pandemic.
How much time and money will it take for "the learning crisis following the COVID-19 pandemic" to be fixed?
Jewelry is now at the forefront of revenge spending in the Philippines.
Before the COVID-19 pandemic, people were scared to send their jewelry, gadgets and other valuables via courier services — but times have changed.
“Ngayon nga, ni-Lalamove, dini-DHL ang alahas. Dati hindi, ‘di ba? Dati, takot ang mga customers. So nag-change na talaga ang kanilang behavior,” Sheila Shalduga, Palawan Group of Companies Chief Commercial Officer, recalled an instance of how much consumer behavior has changed since the pandemic.
Likewise, according to her, people nowadays are more confident in buying jewelry online, resulting in a spike in jewelry sales.
“Jewelry is really one of the industries that really boomed during the pandemic and especially after. So isa ‘to sa mga tinatawag na ‘revenge spending’ categories. When consumers couldn’t go out, they decided to invest in jewelry. And even if you look at our internal sales, our jewelry business grew significantly, especially after the pandemic,” she declared at the company’s recent media conference for the launch of their new Palawan Gold bars and jewelry collection.
She noted that the jewelry market has been experiencing a double-digit growth and is expected to grow by 2026, at around 15 to 20%, depending on the source.
“This is an indication that customers now… understand that buying jewelry, buying gold is a good investment because they can rely on it in times of need.”
Carlo Castro, the company’s President and Chief Executive Officer, attested that jewelry spending during and post-pandemic has been so high, it crushed notions that people did not have money during those times.
“Even during the lockdown, we were surprised, ang daming bumibili ng alahas… and even post-pandemic,” he shared.
Bobby Castro, the company’s chairman, revealed that jewelry sales now plays a significant role in their company’s expansion into more branches and product categories, such as the new Palawan Gold bars and jewelry.
“Alam n’yo ba kung ilan ang nareremata lang? Akala kasi ng iba, ang pawnshop kumikita sa nareremata, pero actually, hindi. In our case, foreclosure is about four percent, so meaning, 96% ng mga isinasangla ay tinutubos. And ‘yung 4% na ‘yun, part ng nareremata, nililinis lang namin then ibinibenta ulit as jewelry,” he disclosed.
Shalduga affirmed that jewelry expenditures would continue to rise due to online selling.
“This is one of the things that changed sa habits ng mga customers during the pandemic na pagbili (ng alahas) sa online. Live-selling – kahit sa’n ka tumingin, may live-selling ng alahas.”
So, it's less about buying jewelry and more investing in gold.
Another business which began during the pandemic is now a success with a real storefront.
In 2020, as the world was gripped by the stillness of lockdowns, Jmie Icasas found herself in a situation all too familiar to many—searching for clarity amid uncertainty. Luckily for Icasas, it came in the form of a chocolate chip cookie.
A weeklong cooking challenge with her sisters led her to bake what she would later call her “OG Chocolate Chip Cookie.” Little did she know, this simple act of baking would sow the seeds of The Kind Cookie, a business that would become synonymous with kindness, passion, and community.
Humble beginnings would describe the early days of The Kind Cookie, a small Instagram operation where Icasas delivered cookies in Ziploc bags with handwritten notes. However, this soon blossomed into a thriving business with a physical store in Salcedo Village. This is not only proof of her entrepreneurial grit but also a celebration of the community and values that have fueled her journey.
“I wasn’t even looking for a storefront,” Icasas says with a laugh. “I just wanted a bigger kitchen. But when I found this space, it felt like the universe was telling me it was time to take the leap.”
Beyond a quaint little cookie shop, The Kind Cookie reflects Icasas’ belief in the power of small acts of kindness, and what it truly means to make a difference.
The pandemic was an unlikely catalyst for Icasas’ entrepreneurial journey. In the quiet days of the lockdown, she found solace in her kitchen as she experimented with recipes and shared her creations with friends and family. “Like most people, we were stuck at home, not knowing when life would go back to normal,” she recalls. “That’s when I baked the cookie that started it all.”
Her decision to turn this hobby into a business was driven by a combination of encouragement from loved ones and a desire to do something meaningful during an uncertain time.
However, launching a business amid a pandemic came with its fair share of challenges. “Everybody, as in everybody, started baking from home and creating some sort of online business,” she explains. “The competition was tough, and I had to figure out how to stand out with very limited resources.”
One way she distinguished herself was by sharing her journey on TikTok, where her authenticity and behind-the-scenes glimpses resonated with audiences. “People love seeing the real side of a business,” she says. “That’s when I learned how powerful storytelling can be.”
While the pandemic played a role in shaping her path, it was not the sole catalyst for Icasas’ baking journey. “I grew up in the kitchen,” she shares. “Baking with my grandparents and experimenting with recipes as a child are some of my happiest memories.”
This lifelong love for baking naturally evolved into a purpose-driven endeavor. “From the start, I knew The Kind Cookie had to be about more than just selling cookies,” she explains. “It was about spreading kindness and showing people that small acts can have a big impact.”
It is a feel-good story we have heard many times. Surely she is better off now than before the pandemic.
