Philippines Expects Economic Growth Curbed by Typhoon Haiyan/Yolanda
Aside from the loss of lives and damages to infrastructure and livestock, the Philippines is expecting Typhoon Haiyan (Yolanda) will make an impact on its economic growth.
Cesar Purisima, the country's Finance Secretary, said the projected gross domestic product (GDP) growth for 2013 may be trimmed by 1 per cent because of Typhoon Haiyan (Yolanda).
"This will have a major punch on the fourth quarter GDP this year but it will have its full impact lag into 2014. This overlaps with the negative impact or reconstruction demand from (Typhoon) Pablo, (the battle of) Zamboanga and Bohol (earthquake) which total another P60 billion," Albay Gov Joey Salceda, recently elected chairman of the United Nations' Green Climate Fund, told local media.
Typhoon Haiyan's (Yolanda) total economic impact may reach $14 billion.
The Philippines had earlier forecast its 2013 economic growth will hit the targeted 6 per cent to 7 per cent. In September, the IMF had said the country, once dubbed the "sick man of Asia," will reach a GDP growth of 6.75 per cent.
But economists strongly believed whatever deceleration in growth would be relatively short lived, mainly because the regions or areas that Typhoon Haiyan (Yolanda) blasted comprise only 20 per cent of the Philippines' population.
Their contribution to the national economy is smaller - only around 12.5 per cent of GDP, Mr Purisima said. Essentially, central Philippines could decline by 10 per cent for the current year.
Charles Watson, director of research and development at Kinetic Analysis Corp., a disaster-modeling firm, forecasts losses will reach $12 billion to $15 billion, or 5 per cent of overall economic output.
"A $12-billion storm is not really that bad here in the US," Watson told local news outlet BusinessMirror. "For the Philippine islands, it is catastrophic."
The government has allocated ₱23 billion for the reconstruction of damaged infrastructure.
"The recovery would be quick as we go into reconstruction and could push next year's growth a little bit higher," Euben Paracuelles, a Singapore-based economist at Nomura Holdings Inc., was quoted by BusinessMirror.
Amando Tetangco, central bank governor, confirmed that reconstruction will help improve GDP growth numbers as this provides economic stimulus.