Crossroads (Toward Philippine economic and social progress)
Philippine Star, 25 June 2014


In an earlier column (June 4, 2014), I described my impressions of the Eastern Visayas six months after Typhoon Yolanda’s destructive fury. Today, I look into the reconstruction phase in wider development context.

Samar and Leyte as island bridges of the nation. Samar and Leyte are the island bridges between the country’s north and the south and the western Visayan islands. They have good land, mineral and aquatic resources and are well populated. These attributes are favorable for agricultural, fishery and industrial potentials.

During the 1960s until the mid-1980s, Leyte was an economic leader among the Visayan provinces. This was in part due to strong political connections. Such luck turned upside down after 1986 – People Power time.

Leyte, however, is part of the country’s economic chain of strength. Its geothermal resources have been tapped, producing electricity for the national electrical grid. Its coconut, abaca and other produce have contributed toward raising national economic supply.

Samar is a different story. The eastern side of the island is linked to the national road network. But the rest of the province has remained relatively backward.

Poverty in Eastern Visayas. Before Typhoon Yolanda visited, the poverty status was worsening. While the nation’s overall situation has been improving on the average, the region’s poverty incidence worsened from 2006 to 2012.

In 2006, it was the 7th poorest, with 41.5 percent of people in poverty; in 2012, its poverty incidence rose to 45.2 percent percent of population, making it the second poorest region in the country.

Samar island has the poorest provinces, Eastern Samar having 63.7 percent of the people among the poor. Leyte is better off, but in 2012, Southern Leyte had 43.3 percent of its population as part of the poor, still relatively poor by national standards.

Yolanda damage aggravates poverty. After Yolanda, the poor have become desperately poorer along the typhoon’s path.

When standing agricultural crops are wiped out, the expected output is totally lost. When capital (the means to more production) is badly damaged or lost, then multi-year future output is reduced if not totally lost.

The poor who have low incomes cannot buy insurance. Their lives are intertwined with hand-to-mouth economic sustenance against the whims of nature. That makes them very vulnerable to catastrophic disasters.

After Yolanda, the poverty situation got worse. The economic loss arising from casualties of 5,826 dead and officially missing of 983 persons, close to 30,000 persons were injured surely transmitted more poverty on the survivors.

Official estimates of damage and needs. Official damage count according to NEDA’s Region 7 reports that 420,000 houses were damaged, with 220,000 of them wiped out. Nearly 1,000 government-owned structures were also destroyed.

The economic damage to output and capital reached P68 billion. In agriculture, the damage came to P38 billion (48 percent; all percentages in this and next paragraph are with respect to the total); to the social services sector (which included housing, education and health) it was P15.3 billion (20 percent); to trade and services, P11.4 billion  (15.2 percent); infrastructure, P6.4 billion (10 percent of total); to industry P1.7 billion  (or 2.3 percent).

The government assessed that the reconstruction and replacement costs for this damage sums up to P78.5 billion. Much of this amounting to P22.7 billion (or 32 percent) is for action in the social sectors (education, health and housing); the reconstruction of the agriculture, fishery and forestry sector amounts to P16.4 billion (or 23 percent); the recovery of industry and trade requires P13.9 billion (19.7 percent); and infrastructure needs P11.4 billion (15 percent).

According to NEDA’s Region 7, such damage from the typhoon affected 1.29 million workers, impacting on the 70 percent of the employed workers in the region. Further, this meant a rise of underemployment from 24 percent to 36 percent.

The projected output (the gross domestic regional product, GDRP) of the region was estimated to imply a drop of 18.9 percent for the year.  Such drop in output could only mean an aggravation of poverty in the region. Early estimates say that the 46 percent poverty estimate for the region could rise to 60 percent!

Even if these estimates are overboard, one thing is clear. The economic damage and the setback to the region is immense.

Economic reconstruction and development. The rebuilding from the ruins has already begun.

The economic catastrophe was borne by families, business and private business, with some relief provided by government and external aid.

Activities of a short-term nature was most important immediately after the disastrous typhoon. For instance, various social aids – mainly in the form of housing support – shelter kits, immediate cash, planning of recovery and new shelter sites – were dispensed to take care of survival needs.

While much private, non-governmental assistance has been given, these have already tapered down. In general, it is the persistence of government help and the effort to undertake long- term development projects that will save the day for the region.

Reconstruction and development projects go together. In the case of Eastern Visayas, the reconstruction projects and development projects go together. They both move the region out of extreme poverty.

The case for Leyte is one also of catch-up. The province could play its destined role for a larger stake in the country’s development. Reconstruction programs and development projects would expand Leyte’s economic capacity.

The case of Samar is one of rising from the depths of poverty. Much of Samar – the northern part – was spared by Yolanda. But it is one of the most neglected of areas of the country. This has made it ripe as a hotbed of NPA insurgency.

The USAid is financing the widening and rehabilitation of a long stretch of roads from the central part of the province all the way to the southern tip of the island to Guiuan. A major challenge for Samar is to build a road network to connect the coastal communities and the interior.

A program of road-building and upgrading, complemented by investments in irrigation, are included in the regional development plan. This includes building the northeastern coastal roads that have long been missing to complete encircling the island.