Home to one of the fastest growing economies in Southeast Asia as well as the location for 10% of the world’s semiconductor manufacturing services for such devices as mobile phone chips and microprocessors, the Philippines was rocked by a powerful category 5 typhoon over the weekend, the second such this year and as the country was still reeling from a recent 7.1 earthquake.
According to Maplecroft, a UK-based risk research company, the Philippine economy is the most at risk, globally, from natural hazards. In fact, the Asian Development Bank estimates losses from such natural disasters average US$1.6bn annually, the most in South East Asia. Still, its economy has been a shining star among other Asian countries, growing 7.6% for the first half of 2013 as it moves from an agricultural-based economy to an industrial one. Exports have been on the rebound as global demand picks up, growing 2.3% in August with electronic products growing the fastest at 11.2%.
Much of the manufacturing and financial services are centered in the capital city of Manila which seems to have escaped the full brunt of the storm and is returning to some kind of normality. Meanwhile, in the hardest hit areas of the country, including Tacloban and Roxas City, airports and ports remain closed along with many roads.
According to the Journal of Commerce, Cebu’s airport and port have reopened despite intermittent power and communication failures. Among the logistics and transportation providers with operations in this area, TNT Express reported that it had reopened its Cebu depot and that its employees were safe and operations were returning to normal. DHL Express’ operations in Cebu, where most of its customers are based, are also returning to normal. DHL Supply Chain’s Cebu operations have resumed as well. However, its operations in heavily affected areas – particularly Tacloban, Samar, Ormoc and Kalibo – remain suspended.
It will take quite a while for the Philippines to fully recover from this latest catastrophic event and thus will see its economy likely take a hit as a result. However, it will most certainly recover and its infrastructure projects will probably be given a higher priority for completion in order to set the country back on the road to recovery.