​Lockdown watch (5)

PHILIPPINES - In Brief 29 Apr 2021 by Romeo Bernardo

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Last night, President Rodrigo Duterte extended the quarantine status of NCR+ (mECQ) by two weeks to May 15. The decision followed two weeks of improving covid19 statistics that saw active cases falling by half since mid-April to less than 70k, albeit still over 2.5x pre-surge levels in February. The hope is that extending mECQ, a move supported by Metro Manila’s 17 mayors and the health community, will help decongest hospitals and bring ICU occupancy from over 70% presently to safer levels of below 60%.While the capital’s mayors wanted mECQ extended, they also put forward the idea of a “flexible mECQ,” a hybrid of mECQ and the less restrictive GCQ. The idea is to keep the mECQ tag but permit more of the heretofore barred activities to resume operations. It is not clear at this time what the adjustments will be but to start the ball rolling, the mayors agreed to cut curfew[1] by 3 hours beginning May 1. Although we can only wonder how much incremental activity such tweaking of the rules will generate, we are inclined to view this cautious approach positively considering the more transmissible virus mutants and what we said in our previous Note are non-trivial odds of resurgence if NCR+ were to shift to GCQ prematurely with cases still relatively high and vaccines still just arriving in trickles. Given the 1.5-month lockdown, we expect to see Q2 output decline sequentially from Q1.[2] However, the smarter way in which the current lockdown is being carried out,[3] with less mobility restrictions and with businesses and the public learning to adapt, implies that the cost will be less than last year’s strict lockdown. We still think GDP growth unlikely to exceed 5% this yea...