Economic slowdown

CLEAR SIDEWALKS. Normally this portion of CM Recto Street, in front of Avida Towers is busy with vehicles but with the community quarantine, it feels more like a ghost town. (Macky Lim)
CLEAR SIDEWALKS. Normally this portion of CM Recto Street, in front of Avida Towers is busy with vehicles but with the community quarantine, it feels more like a ghost town. (Macky Lim)

IT’S ten minutes before nine o’clock in the evening and Erwin, a taxi driver in Davao City had just gotten a passenger probably his last passenger for the night. It was March 19, 2020, four days after Davao City Mayor Sara Duterte-Carpio declared partial lockdown in the city following the first confirmed case of coronavirus disease (Covid-19) in Davao Region.

On that night of March 19, too, the city mayor imposed an earlier curfew for Dabawenyos. Everyone is requested to be in their houses by 9 p.m. to lessen unnecessary foot traffic in the city with the hopes of also avoiding further transmission of the virus. On normal nights, Erwin takes home P5, 000 for his family but with the lockdown, with establishments closing down, and Araw ng Davao activities cancelled, he earns a measly P500 as take-home.

“Mobyahe lang gihapon ko. Maghulat lang ko [sa management] muingon sila’g stop na byahe kay curfew na. Pero tan-awon lang ma-swertehan naa pay pasahero unya. (I will still work tonight. I’ll just wait the advice from the management whether or not we should continue working beyond curfew. If I’m lucky, there would be a few passengers later tonight),” Erwin shared.

Although thankful that the taxi operators had decreased the taxi rental rate of drivers by P200, Erwin still thinks the Covid-19 has tremendously affected their livelihood.

Same is the case for fruit and pasalubong vendor Rodita Arilla who manages OHJ Enterprises opposite Madrazo Compound. As Araw ng Davao is scheduled on March, Arilla and the other pomelo vendors in that stretch of the road were actually expecting good sales because of domestic and foreign tourists supposedly visiting the city for the festival. They have a local supplier from whom they source out boxes and boxes of pomelo as well as packed durian candies.

But Covid-19 changes all that.

“Daghan unta og supply among supplier sa bodega. Nagakuha ra pud mi didto pero wala man mamalitay ron. Mingaw kaayo. Kilo-kilo lang pud ilang paliton. Tag isa o duha, dili pareha sa una na tig-box gyud paliton kay dal-on sa Manila. (Our supplier actually has a lot of supplies in the warehouse. We just get the stocks we need there but now, there are no customers. It’s actually very quiet. A few customers would buy one to two kilos unlike before people would buy pomelo in boxes to bring back home to Manila),” shared Arilla.

Aside from that, they are also forced to lower the prices of their commodities as demand has also decreased. From P100-P120 per kilo, they now sell their pomelo for P80 per kilo. The boxes are now sold for only P500 per kilo from P700 per kilo. Because of this, they are already lucky to earn P1,000 a day as compared to their P5,000 daily income during Araw ng Davao.

Stock market taking the blow

But this economic effect of Covid-19 does not only affect micro, small, and medium enterprises but literally all the business sectors imaginable.

As this problem is global in nature, the stock market had long ago been suffering and affected by Covid-19. Business Development Officer of First Metro Securities Davao Roberto Marco Samson said the current situation had been generating a lot of fear to the investors because it is causing a lot of unpredictability.

Since the Covid-19 threat broke out in different parts of the globe and in the country, investors have since transferred their investments to safer asset classes, some have reallocated to savings account, while others have started selling their shares.

“Right now, there is panic selling on the part of the investors. Understandable kasi they see a lot of factors such as cancelled flights, malls closing for a month – things like that. So majority of the investors are really selling portions of their shares,” said Samson.

He explained that when the stock market index falls by about 10 percent, a trading halt happens for about 15 minutes a day giving investors time to rethink of their selling decisions. But working in the industry, he said it was his first time to actually experience trading halt two days in a row when the index reached 9.5 percent. On normal days, the stock market index decrease plays at around 3 percent only.

“This is one of the worst days of trading...but eventually it will reach prices that people think is unbelievably cheap and may start buying again. But it really depends on how this virus lasts here,” said Samson.

He, however, is very positive that the stock market will be able to breeze through this economic challenge knowing that it had gone through a number of recessions in the past.

“This will be fine in the end because this is not a financial crisis per se, it’s a disease that has a ripple effect on the market,” he said.

Challenge on the events industry

On the same day that the city mayor imposed an earlier curfew, she also released an executive order temporarily closing all malls in the city except for the supermarkets, pharmacies, banks, mall in-house department stores, medical laboratories, and clinics.

Stand-alone restaurants in the city have also decided to suspend their operations. Through a statement, the members of the Davao Restaurant Owners Association (DROA) announced their decision to close Nanay Bebeng, Annipie, Yellow Fin, Tsuru, MarinaTuna, Rekado, Tiny Kitchen, Sarungbanggi, Taps, Villa Margarita, Habi at Kape, and Café Demitasse among many other local restaurants. Although some have decided to open their restaurants strictly for delivery and take-out transactions, the others chose to wait for the situation to be better before they open their kitchen again.

Mary Ann Montemayor, owner of both Villa Margarita and Habi at Kape, shared how the Covid-19 shook their catering business. Villa Margarita is known to cater to huge conferences and events in the city mostly held at the SMX Convention Center at SM Lanang Premier.

“Two days after the executive order prohibiting social and mass gatherings was released, we were supposed to have a wedding and then a conference for 600 people. But all of those are immediately cancelled. It was followed by the order to close down malls so we also had to close Habi at Kape at Abreeza Mall,” Montemayor shared.

Usually their March bookings involve conferences at SMX Convention Center for events with at least 500 participants. On April, they were also supposed to cater for the three-day Coffee Summit, an event by the Presidential Communications Operations Office (PCOO), and a few weddings and birthdays on the side. But Montemayor understood the need to cancel all of these.

“For now, we rely on whatever savings we have, sometimes even personal savings to help our employees,” she said.

“Businesses are closed, walang income pero tulungan lang tayo. We’re praying and hoping na mag-better ang situation if and when mag-follow tayo. We’re looking at until end of April. We’re taking it one day at a time. In the meantime, we need to sacrifice. Everyone naman is experiencing belt-tightening these days,” Montemayor added.

But despite of this challenge in the business, Villa Margarita gives back to the community by preparing 140 food packs per day to be donated to the frontliners working at the Southern Philippines Medical Center (SPMC). Other food entrepreneurs such as Chef Patrick Co of Fat Cow Restaurant and Chieb Rechie Elizalde of Real Confections Davao had also donated food for the SPMC frontliners.

No one can really point a finger to the exact day this economic challenge will last but one thing is certain. This is more than just a health concern now. Covid-19 has separated families, has closed businesses, and has challenged transportations system in the country. However it has, in a way, blurred the social class line as everyone feels the financial effects the virus brings.

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