Philippines Analytical Update: Enhanced Community Quarantine extended to May 15 over high-risk COVID-19 areas

Philippines Analytical Update | May 4, 2020
Authors: Julianne Alberto, Lilibeth Almonte-Arbez, Marc Mealy, Kim Yaeger

The Philippines extends Enhanced Community Quarantine until May 15 over high-risk COVID-19 areas

On May 1, the Philippine government published Executive Order 112 series of 2020 (E.O.112) (copy attached) extending the Enhanced Community Quarantine (ECQ) until May 15 over high-risk COVID-19 areas: National Capital Region, Bataan, Bulacan, Nueva Ecija, Pampanga, Tarlac, Zambales, Cavite, Laguna, Batangas, Rizal, Quezon, Pangasinan,  Benguet, Baguio City, Iloilo, Cebu Province, Cebu City, and Davao City. For the same period, a general community quarantine is imposed in all other areas of Luzon, Visayas and Mindanao, provided that, as a precondition, minimum health standards are achieved and continuously observed. To harmonize quarantine measures across the country, E.O. 112 supersedes any local community quarantine. Any “community quarantine” by a local government unit, regardless of nomenclature, cease to take effect on 12:01 a.m. of May 1. All decisions to impose, lift, or extend a community quarantine in provinces, cities and municipalities will rest with the Inter-agency Task Force for the Management of Emerging Infectious Diseases (IATF-EID). Provincial Governors may impose, lift or extend ECQ in component and municipalities upon the concurrence of the relevant regional counterpart body of the IATF-EID. Mayors of Cities and Municipalities are also authorized to impose, lift or extend ECQ in villages, upon the concurrence of the relevant regional counterpart body of the IATF-EID. This is without prejudice to the authority of the IATF to DIRECTLY impose, lift or extend ECQ in these areas, should circumstances call for it. E.O. 112 also provides for guidelines regulating the movement of people and goods between different quarantine zones.

Measures that apply to ECQ and GCQ areas

  1. The movement of all types of cargoes by land, air, or sea within and across areas placed under ECQ or GCQ shall be unhampered. Workers in the logistics sector, such as cargo, trucking, and port operations are allowed to transit across areas placed under ECQ or GCQ. All LGUs are directed to strictly abide by this national policy. Provided, that only a maximum of five (5) personnel may operate cargo and delivery vehicles by land, with or without load.
  2. No hotels or similar establishments are allowed to operate, except those accommodating guests who have existing booking accommodations for foreigners as of May I, 2020 for areas outside Luzon; guests who have existing long-term bookings; distressed Overseas Filipino Workers (OFWs) and stranded Filipinos or foreign nationals; repatriated OFWs in compliance with approved quarantine protocols; non-OFWs who may be required to undergo mandatory facility-based quarantine; and health care workers and other employees from exempted establishments under these Omnibus Guidelines and applicable Memoranda from the Executive Secretary. Hotel operations shall be limited to the provision of basic lodging to guests.
  3. A grace period of thirty (30) days from the last due date, or until such time that the community quarantine is lifted, whichever is longer, is granted for residential and commercial rents falling due upon residential lessees and micro, small, and medium enterprises (MSMEs) not permitted to operate during the ECQ or GCQ. MSMEs will not incur interests, penalties, fees, or other charge on these leases.
  4. Mass gatherings such as but not limited to, movie screenings, concerts, sporting events, and other entertainment activities, community assemblies, religious gatherings, and non-essential work gatherings are prohibited.

Enhanced Community Quarantine measures

The ECQ extension will effectively place the National Capital Region under ECQ for two months.  ECQ measures include strict stay-at-home rules and the suspension of public transport and classes in all levels of education.

The following are allowed to work or operate with a skeleton workforce in ECQ areas:

  1. Industries involved in agriculture, forestry, and fishery and their workers, including farmers, Agrarian Reform Beneficiaries (ARBs), fisherfolk, and agri-fishery stores, and such other components of the food value chain, at full operational capacity;
  2. Private establishments and their employees involved in the provision of essential goods and services, and activities in the value chain related to food and medicine production, such as but not limited to, public markets, supermarkets, grocery stores, convenience stores, laundry shops, food preparation establishments insofar as take-out and delivery services, water-refilling stations, hospitals, medical, dental, and optometry clinics, pharmacies, and drug stores.
  3. Manufacturing and processing plants of basic food products, medicine and vitamins, medical supplies, devices and equipment, and essential products such as but not limited to soap and detergents, diapers, feminine hygiene products, toilet papers and wet wipes, and disinfectants. Establishments involved in the production, manufacturing, packaging, processing, and distribution of food may operate at a maximum of fifty percent (50%) of their respective workforce unless the supply level of a basic food product warrants a higher capacity authorized and approved by the Department of Trade and Industry (DTI). Manufacturers of medicines, medical supplies, devices and equipment, including but not limited to suppliers of input, packaging, and distribution, shall be allowed to operate at full capacity.
  4. Delivery services, whether in-house or outsourced, transporting food, medicine, or other essential goods. Delivery of clothing, accessories, hardware, housewares, school and office supplies, as well as pet food and other veterinary products, shall likewise be allowed.
  5. Banks, money transfer services, microfinance institutions, excluding pawnshops not performing money transfers, and credit cooperatives, including the armored vehicle services, if any.
  6. Power, energy, water, information technology and telecommunications supplies and facilities, including waste disposal services, as well as property management and building utility services.
  7. Energy companies, their third-party contractors and service providers, including employees involved in electric transmission and distribution, electric power plant and line maintenance, electricity market and retail suppliers, as well as those involved in the exploration, operations, trading and delivery of coal, oil, crude or petroleum and by-products (gasoline, diesel, liquefied petroleum gas, jet oil, kerosene, lubricants), including refineries and depots or any kind of fuel used to produce electricity.
  8. Telecommunications companies, internet service providers, cable television providers, including those who perform indirect services such as the technical, sales, and other support personnel, as well as the employees of their third-party contractors doing sales, installation, maintenance and repair works.
  9. Business process outsourcing establishments (BPOs) and export-oriented business with work-from-home, on-site or near site accommodation, or point-to-point shuttling arrangements. For this purpose, BPOs and their service providers and export-oriented businesses shall be allowed to install and transport the necessary work-from-home equipment, to enhance their operations by deploying their workers under on-site or near-site accommodation arrangements, or provide point-to-point shuttle services from their near-site accommodations to their offices.
  10. Airline and aircraft maintenance employees, including pilots and crew, and sbip captains and crew
  11. Media establishments, at a maximum operational capacity of fifty percent (50%) of their total permanent staff complement as registered under the Department of Labor and Employment (DOLE), inclusive of reporters and other field employees, as accredited by the Presidential Communications Operations Office.
  12. Construction workers accredited by the Department of Public Works and Highways to work on facilities identified for purposes of quarantine and isolation, including such facilities for the health sector, emergency works, flood control, and other disaster risk reduction and rehabilitation works.
  13. Manufacturing companies and suppliers of equipment or products necessary to perform construction works.
  14. Workers accredited by the Department of Transportation (DOTr) to work on utility relocation works and specified limited works across thirteen (13) railway projects, including replacement works for the Manila Metro Rail Transit System Line. Provided, that where applicable, on-site or near-site accommodations and/or point-to-point shuttle services are arranged.
  15. Funeral and embalming services. Provided, that funeral service operators are directed to provide shuttling services and/or housing accommodations for their personnel and staff;
  16. Veterinary clinics; and
  17. Security personnel.

Also allowed to operate under ECQ are agencies and instrumentalities of the government; diplomatic missions and accredited international organizations; capital markets, including but not limited to the Bangko Sentral ng Pilipinas, Securities  and  Exchange  Commissionn, Philippine  Stock  Exchange,  Philippine Dealing and Exchange Corporation, Philippine Securities Settlement Corporation, and Philippine Deposito1y and Trust Corporation; the Philippine Postal Corporation; the Philippine Statistics Authority, at a capacity necessary to conduct data gathering and survey activities related to COVID-19 and the registration and implementation of the national identification (ID) system; humanitarian assistance personnel from civil society organizations (CSOs), non-government organizations (NGOs), and United Nations-Humanitarian Country Teams, as well as individuals performing relief operations to augment the government's response against COVID-19 and other disasters or calamities that may occur. Provided, that they are authorized by the appropriate government agency or LGU; pastors, priests, imams or such other religious ministers whose movement shall be related to the conduct of necrological or funeral rites. Immediate family members of the deceased from causes other than COVID-19 shall be allowed to move from their residences to attend the wake or interment of the deceased upon satisfactory proof of their relationship with the latter and social distancing measures.

General Community Quarantine measures

The following sectors or industries are allowed to operate in GCQ areas:

Category I Industries - Agriculture, fishery, and forestry industries, food manufacturing and food supply chain businesses, including food retail establishments such as supermarkets, grocery stores, and food preparation establishments insofar as take-out and delivery services, food delivery services, health-related establishments, the logistics sector, information technology and telecommunication companies, the media, at full operational capacity;

Category II Industries - Mining and other manufacturing, export-oriented, and electronic commercial companies, as well as other delivery, repair and maintenance, and housing and office services, at anywhere between fifty percent (50%) up to full operational capacity, and without prejudice to work-from-home and other alternative work arrangements; and

Category Ill Industries - Financial services, BPOs, legal and accounting, and auditing services, professional, scientific, technical, and other non-leisure services, barber shops, salon, and other personal care services as defined by the DTI, and other non-leisure wholesale and retail establishments, at a maximum of fifty percent (50%) work-from-home arrangement, and without prejudice to work-from-home and other alternative work arrangements.

Limited operations in malls and shopping centers are allowed, except for leisure establishments and services which shall continue to be closed. Provided, that establishments and services allowed to operate in malls and shopping centers may only operate at 50% capacity and alternative work arrangements such as flexible work, compressed work week, telework, and telecommuting is encouraged. DTI may issue guidelines to limit foot traffic in such establishments.

Essential public and private construction projects, such as but not limited to sewerage, water services facilities, and digital works, and health facilities, and priority projects, shall be allowed to operate in accordance with guidelines issued by the DPWH, reflected in a separate issuance.

Amusement, gaming, and fitness establishments, as well as those in the kids and the tourism industries, and all Category IV industries may not operate. Industries in Category IV are reflected in a separate DTI issuance.

On April 24, there were more areas under ECQ based on a taped government broadcast.  On April 28, Presidential spokesperson Harry Roque unveiled a shorter list of areas covered under ECQ citing the Inter-agency Task Force (IATF) Resolution #29 (copy attached). The Palace spokesperson further disclosed that in the latest IATF resolution, the Department of Tourism is given authority to charter and fund sweeper flights for stranded local tourists from various regions of the country back to Metro Manila. Several agencies of government such as Department of Health, the Department of Transportation, the Department of Trade and Industry, the Department of Labor and Employment, and the Department of Public Works and Highways are drafting minimum health standards.

In light of the anticipated concerns regarding movement of goods given the “new normal”, President Rodrigo Duterte's fifth report on the implementation of Republic Act No. 11469 stated that the Philippine Ports Authority has issued 8,000 IATF IDs to ensure unhampered movement of cargo. Likewise, the IATF has approved the prototype of the Supply Chain Analysis Dashboard to address bottlenecks to supply and distribution of goods.

The President also pointed out that the Technical Working Group on Anticipatory and Forward Planning has submitted a report to the IATF on the phases of government response to the pandemic (i.e., immediate response, mitigation, and transition to “new normal”). Thereafter, the National Economic Development Authority is set to convene its committees and other agencies of government to identity priority programs for 2021. The administration has been directed by Congress to take a “whole of government” approach in mapping out these phases.

The Council will continue to monitor and give updates on the latest Philippine government issuances implementing measures that address the COVID-19 pandemic.  

Acting NEDA Secretary Chua discusses 4-Pillar Socio-economic Strategy against COVID-19

In an April 22 interview with CNN Philippines, Acting Secretary Karl Kendrick T. Chua emphasized the dual nature of the pandemic in health and economic terms and what the Philippine government hopes to achieve during the ECQ which is to increase health resources and testing capacity and achieve improved health outcomes. His discussion of the Philippine government’s 4-pillar socio-economic strategy to combat COVID-19 is summarized below:

  1. Emergency Support for Vulnerable Groups
  • There is a social amelioration package US$11.6 billion (Php 590 billion) to help the poorest 18 million families in the informal sector. This will give families US$98.5-US$158 (Php5,000-8,000) per month for 2 months.
  • There is also over US$ 1 billion (Php 51 billion) small business wage subsidy program for micro, small, and medium enterprises (MSMEs) to support those with insufficient liquidity or who face challenges in accessing capital. This is conditioned on the retention of employment. An employee cannot be fired nor could an employee resign then avail of the wage subsidy.
  • With only a 2-week preparation from the time President Duterte announced the initial ECQ last March 16 to roll out these packages, there were access issues. Government websites could not accommodate the millions of applications so the Social Security System (SSS) agency emailed those eligible to drive up the registration and access of MSMEs and individuals.
  • DOF is considering giving guarantees for MSMEs loans and allowing the carry-over or credit of net operating loss to reduce tax payments. We have to wait for details after this was announced last week.
  • The deferment of certain tax charges and grace period for rent, mortgages, and loans were rolled out ahead of ECQ.
  • In the initial survey of 44,000 MSMEs, majority were not asking for money and but were asking for deferment of certain payments. But they also indicated that their working capital was good up to 2 months then it will be tough to remain open or re-open so the government came up with the wage subsidy.
  1. Resources to fight COVID-19
  • The government has been preparing the last 3 years so we have available resources for situations like this. Three tax reform packages were implemented and these ensured that the Philippine government has BBB+ credit rating. The government could borrow cheaply but this borrowing has to be done judiciously. Right now, it is like we are calling on our insurance policy.
  • The National ID system was approved 2 years ago and the procurement and implementation have to be expedited during the ECQ so that at least 5 million up to 10 million heads of household could register, have IDs, and open bank accounts. It will then be easier to target beneficiaries of socio-economic programs.
  • An ECQ cannot be sustained forever and everyone must work together to improve health outcomes. The government is prioritizing health.
  1. Fiscal and Monetary Actions
  • There has to be coordinated policy to ensure fiscal resources and have a more accommodating monetary policy. For every 1% reduction in reserve requirements, US$2.16 billion (Php110 billion) is raised according to the Bangko Sentral ng Pilipinas (BSP). But the Philippines is not “a command & control economy” (not centrally planned). The government could only provide the enabling environment for support and liquidity (could be in the form of guarantees) so banks could manage risks in prudent lending.
  1. Economic Recovery Plan
  • Our initial survey for consumers and MSMEs was a quick general survey with qualitative results. We will have a second bigger survey that would be more quantitative so we could be informed better. The private sector is always heard through the submission of position papers.
  • We need science and data for evidence-based policy. We have to quantify and model the economic losses and trade-offs and find balance with health outcomes. Then we are better able to assess the kind of recovery trajectory we would have.
  • The Philippines has strong macroeconomic fundamentals with a median age of 24 years. Our population is less vulnerable. If we are able to build up our health capacity during the ECQ and improve testing, then we will have more data. Then it would be easier to model our recovery trajectory, whether it is V-shaped, W-shaped or a deep valley before a vaccine could be found.

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