Disaster impact threatens Eastern Visayas’ 2017 economy

TACLOBAN CITY, Dec. 29  -- The two major natural calamities that battered Eastern Visayas region this year may slow down the 2017 regional economic growth after four years of reeling from the impacts of super typhoon Yolanda.

The magnitude 6.5 earthquake that shook Leyte Island on June 6, 2017 and Tropical Storm Urduja that ravaged Biliran province mid-December are considered by the National Economic Development Authority (NEDA) as major setbacks in sustaining economic growth.

The ground-shaking has destroyed facilities of geothermal power plants, triggering a week of total blackout in the region’s six provinces and nearby islands and two weeks of rotational brownouts. It killed four people and injured 100 others.

The earthquake may not be very damaging to lives and properties, but its aftermath disrupted economic activities of major industries, said NEDA Regional Director Bonifacio Uy.

“We are losing about 10 percent of our economic output if there’s brownout for a day,” Uy said

Eastern Visayas is one of the seismically active areas in the country because of the Philippine Fault and the Philippine Trench, which are the main earthquake generators, according to the Philippine Institute of Volcanology and Seismology.

“The region’s geographic location, facing the Pacific Ocean and within the Pacific Ring of Fire, makes it prone to all known natural hazards, aggravated by climate change effects,” the official added.

Oliver Cam, business sector representative to the Regional Development Council said power interruptions in July caused weeks of shutdown of two major industries – the Philippine Smelting and Refinery Corp. and Philippine Phosphate Fertilizer Corp. both in Isabel, Leyte.

“The impact of power shutdown to the overall economy may be significant since manufacturing subsector accounts 17 percent to the Gross Regional Development Product,” Cam said.

The official recalled that the tremendous decline in the production of basic metals after PASAR was razed by fire had pulled down the growth of the industry sector to negative 18.5 percent, a sharp reversal from the 1.7 percent growth in 2011.

In 2014, the industry sector value-added growth plunged to negative 3.3 percent due to the production decline of two giant firms after super typhoon Yolanda pummelled Leyte Island.

Consequently, Eastern Visayas was the only region in the country that displayed contraction in its industrial value by about seven percent from 2011 to 2015.

STORM URDUJA

Biliran, the most economically improved province in the region with a poverty incidence of only 17 percent as of 2015, suffered the brunt of slow moving Tropical Storm Urduja a week before Christmas.

Its heavy rains triggered widespread flooding and massive landslide in one of the country’s smallest provinces with a population of only 171,612, less than the number of people in Tacloban City, the regional capital.

Urduja left a massive trail of destruction as landslide buried dozens of houses, cut water and power supplies, and isolated Naval town, the provincial capital as major bridges collapsed.

In the entire region, the calamity killed more than 50 people, the Office of the Civil Defense reported.

Natural disasters inflict serious damage as it destroys tangible assets such as buildings and equipment as well as human resource, hence, reducing production capacity, said Uy.

“We’re still hopeful to achieve respectable if not a remarkable growth since post-Yolanda reconstruction program is continuing. Huge funds have been released this year to government agencies for economic improvement,” Uy explained.

In storm-hit areas, government response is immediate, hence, reducing risks of economic downfall, Uy added.

“The focus in the response phase is meeting the basic needs of the people while the government is looking for more permanent and sustainable solutions,” he said.

Citing the destruction of powerful post-“Yolanda” typhoons such as “Ruby” (2014) in Eastern Samar and “Nona” (2015) in Northern Samar, Uy said “Urduja’s” impact may not be reflected in the Gross Regional Domestic Product (GRDP).

“The most affected sector by weather disturbances is the agriculture sector, where majority of the region’s population depends on it. However, its contribution to the total economy is lower than the manufacturing subsector,” the NEDA regional chief said.

The year-on-year decline in agriculture and fishery output resulted to decreasing share of the sector to the regional economy from 21.9 percent in 2011 to 16.7 percent in 2015.

Despite recent disasters, the region is still keeping the 5.2 percent to 7 percent economic growth and reduce poverty incidence by half to 22 percent within the term of President Rodrigo Duterte.

The challenge is on maintaining the record-high 12.4 percent growth in the GRDP and the decade-low poverty incidence at 38.7 percent attained last year.

Poverty incidence went down, but it is still the country’s third highest next to Autonomous Region in Muslim Mindanao (53.7 percent) and Caraga Administrative Region (39.1 percent).

The predominantly agriculture region is situated in the middle of the Philippines and serves to link the islands of Luzon and Mindanao through the national road and nautical highway that runs through it. (SQM/PNA)