The National Economic and Development Authority (Neda) considers the recent typhoons as “serious concerns” amid the flooding that ensued in many parts of the country due to heavy rainfall.
Socioeconomic Planning Secretary Arsenio M. Balisacan said that while assessments are still being done, he hoped the impact of the floods would not be significant as places like Benguet have been hit by some of the worst flooding from the typhoons and the Southwest Monsoon.
Rains have continued to pour as typhoons Egay and Falcon sweep across the archipelago. As of Sunday, reports from the National Disaster Risk Reduction and Management Council (NDRRMC) showed billions of pesos of damages have been reported in agriculture and infrastructure.
“That’s [typhoon] really a very serious concern because we never expected this kind of seriousness in the flooding. Assessments are still going on, we’re monitoring the situation, especially sa impact sa agriculture kasi [there was] flooding in the Ilocos region. Benguet has also been hit hard and that’s where a lot of our vegetables come from, right? But we’ll see,” Balisacan said.
Based on data from the NDRRMC, agriculture has recorded P1.5 billion in damages from Egay. This was based on reports coming from Region 2-Cagayan Valley, Region 3-Central Luzon, Calabarzon, Mimaropa, Region 6-Western Visayas, Bangsamoro Autonomous Region in Muslim Mindanao (BARMM), and Cordillera Administrative Region (CAR).
The data also showed that damage to infrastructure amounted to P4.389 billion was reported in Region 1-Ilocos Region, Cagayan Valley, Mimaropa, Region 5-Bicol Region, Western Visayas, Region 11-Davao Region, Region 12-SOCCSKSARGEN, BARMM, and CAR.
Balisacan said apart from the typhoons, other risks to inflation and economic growth include oil prices as well as the collapse of the Black Sea Deal on grains between Russia and Ukraine.
“We are seeing the oil prices going up a bit, right? We’ll see how Russia moves in the Ukrainian exports of grains [pans out] but I suspect that it will not just [be] bad in terms of the reaction of the markets as before because I suppose the world learned from those earlier shocks. But we’ll see. It’s hard to predict what comes next after that,” Balisacan said.
Earlier, local economists warned that Filipinos should brace for high commodity prices, particularly products that use wheat, after Russia halted a wartime agreement to allow grain exports from Ukraine. (Full story here: https://businessmirror.com.ph/2023/07/19/phl-at-risk-in-russia-ukraine-grain-deal-halt/)
Reports said Russia has suspended its wartime grains deal or the Black Sea deal brokered by the United Nations and Turkey until its food and fertilizer reach world markets.
Local economists such as Ateneo de Manila University economist Leonardo Lanzona Jr. told the BusinessMirror that this will not only affect prices but could also lead to hunger and “shrinkflation” of wheat-based Filipino favorites such as pan de sal.
Monetary Board Member Bruce J. Tolentino told the BusinessMirror that the suspension of the Black Sea deal “poses a serious risk” to the country. Ukraine and Russia, he said, are the world’s leading suppliers of wheat.
Last Friday, Bangko Sentral ng Pilipinas (BSP) Governor Eli Remolona Jr. said it’s too soon to declare victory against inflation. (full story here: https://businessmirror.com.ph/2023/07/28/too-early-to-declare-victory-against-inflation-bsp-chief/).
Remolona said core inflation—which measures the “underlying trend or movement in the average consumer prices”—remained high. Core inflation was at 7.4 percent in June and averaged 7.7 percent in the first six months of the year.
He said inflation data that will be released by the Philippine Statistics Authority (PSA) in the first week of August would be included in the analysis of the Monetary Board that will determine its decision on policy rates.
Image credits: AP/Bernie Sipin Dela Cruz