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For the past months we have observed unprecedented efforts to contain the pandemic – medically through the response of healthcare professionals, scientifically through the efforts being made to counter the virus and working on possible treatments and vaccines, and politically through the efforts to delay, contain, research and mitigate. Through those various efforts, the coming together of people and societies recognizing the need for collective and intergenerational responsibility, has been both unprecedented and heart-warming.
The pandemic is an extraordinary event that combines health, socio-economic and financial shocks, resulting in exceptional costs and damages and requiring extraordinary thinking and solutions and an ‘anything is possible’ mindset. The immediate responses – consisting mainly of relief and stabilization measures – include the provision of forbearance measures and direct subsidies for citizens and SMEs, as a policy response for the freeze in supply and demand activities. The Philippine Government provided a swift response package primarily through Republic Act No. 11469 (“Bayanihan to Heal as One Act”), approved on 24 March 2020, with focus on the health care sector, low-income households, and small business enterprises. An economic stimulus program –the proposed Philippine Economic Recovery Act – is expected to be enacted when the House of Representatives resumes its sessions on 4 May 2020. In other jurisdictions, stimulus packages have been extended to cover interruption assistance for various businesses and rescue packages for severely hit industries.
There are references and live case studies that can provide concrete opportunities for both the private and public sectors to work together in coming up with collective responses on the economic and financial implications, which can be guided by the following objectives
There are references and live case studies that can provide concrete opportunities for both the private and public sectors to work together in coming up with collective responses on the economic and financial implications, which can be guided by the following objectives:
- Act with purpose. Be clear and consistent on the public interest objective, keep actions based on and fully aligned to this. Deftly embed stewardship of this purpose into the design of current and upcoming interventions, and in the background, begin to consider what this means when the “reboot” begins as the crisis eases.
- Swamp the business cashflow deficit and financing chasm. Avoid major short term cashflow contraction (due to demand or financing issues); protect “good businesses” preferably outside but especially if entering formal insolvency processes.
- Maintain employment, mitigate harm to individuals, and avoid exacerbating health system stress. In particular, minimize job losses by keeping people employed, support the vulnerable self-employed and temporary workers, mitigate self-isolation, and where possible, enable labor to redeploy to match short-term demand shortages.
- Build business resilience and enable timely recovery. Help businesses adapt to changes in demand, regulation and supply chain; stimulate demand and leverage the role of Government as a customer.
- Ensure the financial system remains resilient and able to support the medium-term “reboot”. Firstly, act collectively or individually as Governments to ensure more than sufficient liquidity is in place for the long-term. Secondly, while using the banking system as a transmission mechanism create transparency on risk and ensure banking and insurance markets avoid long-term impairment, act purposefully to reflect stewardship principles.
To get this done, there are several imperatives that need to be adopted, within the constraints of biosecurity, but not prevented by both the private and public sectors:
- Recognize the “Purpose” imperative – build public interest stewardship into the design upfront
- Create an evolving coherent strategic program to act widely within complementary interventions
- Ensure simple intervention design enabling rapid yet sufficient development and deployment while avoiding unnecessary execution risk
- Create multi-skilled execution teams with strong leaders, empower action and remove excessive constraints (e.g., regulation) but do build in sufficient control and compliance
- Recognize the security and cybersecurity threat
The Stimulus Transmission Framework: A 3-way stimulus…for now
Shown here is EY’s stimulus transmission framework that considers the breadth of measures, and their transmission mechanisms to the real economy, as represented by the citizens (covering both individuals and households), SMEs and corporates. The 3-way stimulus arising from the unprecedented coordination of monetary, regulatory and fiscal policies will pass through two primary channels – (1) the national and local Government authorities, and (2) the banking system – that transmit the 3-way stimulus from coordinated monetary, regulatory and fiscal policies.
The Stimulus Transmission Framework: A 3-way stimulus…for now
Shown here is EY’s stimulus transmission framework that considers the breadth of measures, and their transmission mechanisms to the real economy, as represented by the citizens (covering both individuals and households), SMEs and corporates. The 3-way stimulus arising from the unprecedented coordination of monetary, regulatory and fiscal policies will pass through two primary channels – (1) the national and local Government authorities, and (2) the banking system – that transmit the 3-way stimulus from coordinated monetary, regulatory and fiscal policies.
The Stimulus Transmission Framework: A 3-way stimulus…for now
Shown here is EY’s stimulus transmission framework that considers the breadth of measures, and their transmission mechanisms to the real economy, as represented by the citizens (covering both individuals and households), SMEs and corporates. The 3-way stimulus arising from the unprecedented coordination of monetary, regulatory and fiscal policies will pass through two primary channels – (1) the national and local Government authorities, and (2) the banking system – that transmit the 3-way stimulus from coordinated monetary, regulatory and fiscal policies.
The Stimulus Transmission Framework: A 3-way stimulus…for now
Shown here is EY’s stimulus transmission framework that considers the breadth of measures, and their transmission mechanisms to the real economy, as represented by the citizens (covering both individuals and households), SMEs and corporates. The 3-way stimulus arising from the unprecedented coordination of monetary, regulatory and fiscal policies will pass through two primary channels – (1) the national and local Government authorities, and (2) the banking system – that transmit the 3-way stimulus from coordinated monetary, regulatory and fiscal policies.
The Stimulus Transmission Framework: A 3-way stimulus…for now
Shown here is EY’s stimulus transmission framework that considers the breadth of measures, and their transmission mechanisms to the real economy, as represented by the citizens (covering both individuals and households), SMEs and corporates. The 3-way stimulus arising from the unprecedented coordination of monetary, regulatory and fiscal policies will pass through two primary channels – (1) the national and local Government authorities, and (2) the banking system – that transmit the 3-way stimulus from coordinated monetary, regulatory and fiscal policies.
The Stimulus Transmission Framework: A 3-way stimulus…for now
Shown here is EY’s stimulus transmission framework that considers the breadth of measures, and their transmission mechanisms to the real economy, as represented by the citizens (covering both individuals and households), SMEs and corporates. The 3-way stimulus arising from the unprecedented coordination of monetary, regulatory and fiscal policies will pass through two primary channels – (1) the national and local Government authorities, and (2) the banking system – that transmit the 3-way stimulus from coordinated monetary, regulatory and fiscal policies.
| Sample | Headers |
|---|---|
| Shown here is EY’s stimulus transmission framework that considers the breadth of measures, and their transmission mechanisms to the real economy, as represented by the citizens (covering both individuals and households), SMEs and corporates. | Shown here is EY’s stimulus transmission framework that considers the breadth of measures, and their transmission mechanisms to the real economy, as represented by the citizens (covering both individuals and households), SMEs and corporates. |
| Shown here is EY’s stimulus transmission framework that considers the breadth of measures, and their transmission mechanisms to the real economy, as represented by the citizens (covering both individuals and households), SMEs and corporates. | Shown here is EY’s stimulus transmission framework that considers the breadth of measures, and their transmission mechanisms to the real economy, as represented by the citizens (covering both individuals and households), SMEs and corporates. |
Other COVID-19 Information
Where to find us?
Where to find us?