Typhoon disaster huge setback for Philippine economy
The massive typhoon that battered the Philippines on November 8 causing widespread destruction and chaos will set back for years what has been a promising economy and make the nation’s troubling unemployment and poverty rates much worse than they have been, economists say, adding that the country may barely be able to keep its current growth rates and its status as a developing nation.
The IMF originally had forecast Philippine GDP expansion to be 6 per cent in 2013 and 5.5 per cent in 2014. It is highly likely now that GDP will contract in the fourth quarter of 2014 and into next, and that contraction could be as much as 1.4 percentage points.
The Philippines has struggled for years to improve a high unemployment rate, and more particularly an under-employment rate of 20 per cent. In a country with 107 million residents, hundreds of thousands could be thrown out of work. At least short term, those numbers will soar, perhaps until workers are hired to repair the devastation.
The national economy relies on several industries highly dependent on infrastructure that supports factory activity and transportation. These include petroleum and chemical refineries, as well as the assembly of wood products, clothing and electronics. Some 32 per cent of workers are in agriculture which will be devastated for years in areas most badly flooded.
About 6,000 hectares of sugarcane were destroyed, along with corn and rice. Losses in those crops, plus the region’s fishing industry, will likely total around $324 million, or about 0.2 per cent of gross domestic product. The government expects total output from the worst-hit areas to fall around 8 per cent.
Even worse, the negative impact of the typhoon may linger in 2014 due to reduced production capacity, the Philippine National Economic and Development Authority (NEDA) said in a statement issued on November 15. Inflation is also expected to go up.
The massive typhoon that battered the Philippines on November 8 causing widespread destruction and chaos will set back for years what has been a promising economy and make the nation's troubling unemployment and poverty rates much worse than they have been, economists say, adding that the country may barely be able to keep its current growth rates and its status as a developing nation. The IMF originally had forecast Philippine GDP expansion to be 6 per cent in 2013 and 5.5 per cent in 2014. It is highly likely now that GDP will contract in the fourth quarter of 2014 ...
The massive typhoon that battered the Philippines on November 8 causing widespread destruction and chaos will set back for years what has been a promising economy and make the nation’s troubling unemployment and poverty rates much worse than they have been, economists say, adding that the country may barely be able to keep its current growth rates and its status as a developing nation.
The IMF originally had forecast Philippine GDP expansion to be 6 per cent in 2013 and 5.5 per cent in 2014. It is highly likely now that GDP will contract in the fourth quarter of 2014 and into next, and that contraction could be as much as 1.4 percentage points.
The Philippines has struggled for years to improve a high unemployment rate, and more particularly an under-employment rate of 20 per cent. In a country with 107 million residents, hundreds of thousands could be thrown out of work. At least short term, those numbers will soar, perhaps until workers are hired to repair the devastation.
The national economy relies on several industries highly dependent on infrastructure that supports factory activity and transportation. These include petroleum and chemical refineries, as well as the assembly of wood products, clothing and electronics. Some 32 per cent of workers are in agriculture which will be devastated for years in areas most badly flooded.
About 6,000 hectares of sugarcane were destroyed, along with corn and rice. Losses in those crops, plus the region’s fishing industry, will likely total around $324 million, or about 0.2 per cent of gross domestic product. The government expects total output from the worst-hit areas to fall around 8 per cent.
Even worse, the negative impact of the typhoon may linger in 2014 due to reduced production capacity, the Philippine National Economic and Development Authority (NEDA) said in a statement issued on November 15. Inflation is also expected to go up.
