The country’s economic fundamentals will remain sound and intact, despite the devastation inflicted by superstorm Yolanda (international name: Haiyan), according to a reputable international credit rating agency.
In a recent report issued by Moody’s Investor Service, it was predicted that while the loss in property and human lives caused by the catastrophe might be overwhelming, its overall effect on the economy would be insignificant.
The damage to road infrastructure, power lines, communication systems and farm lands would likely lead to a steep drop in output in the local economies of Leyte, Samar, and other Visayan provinces stricken by the typhoon.
Moody’s cited the Philippine government’s own estimate that the damage wrought by Yolanda would likely shave only just a half a percentage point off the country’s estimated growth for 2013.
“The relatively small hit to growth reflects the small contribution of Region VIII to the country’s input,” the report noted. Fortunately, the most important regions in terms of economic contributions – Metro Manila and Southern Tagalog, was spared by Yolanda.
The report recalled that “the 2004 Indian Ocean tsunami that struck Indonesia could be most similar to Typhoon Yolanda in terms of scale of devastation, but it, too, had a limited effect on overall economic condition” of that country.
Moody’s upgraded the country to “investment grade” two months ago. It has predicted that the Philippine economy would grow by 7 per cent this year.