Phl strong peso saving needed as 20-22 typhoons to hit the country
By Jason de Asis
SENATE OFFICE, Manila, January 20, 2011-Senator Ralph G. Recto, chair of the Senate ways and means panel reported that this year 20 to 22 typhoons are expected to hit the country as reported by the Philippine Atmospheric, Geophysical and Astronomical Services Administration (PAG-ASA), saying that the government should allocate higher than P5 billion in calamity funds that even the additional P1.75 billion that the President inserted in the budget is not enough to cover the losses and destruction from the natural calamities to come, considering the nine (9) provinces high-risk areas for the typhoons such as Cagayan Valley, Aurora, Quezon, Bicol, Samar, Leyte, Surigao, Dinagat Island and Catanduanes.
He said that the P6.75 billion calamity fund would be depleted by the time that the first dozen of typhoons have finished wrecking havoc and leave a trail of destroyed homes and crops, adding that to provide safety nets for farmers and fisherfolks, primarily those to be derived from a strengthening peso value since the budget is based on a higher exchange rate, the President could readily tap the expected savings from the 2011 budget.
“Savings are expected from debt interest expense, which was pegged on an exchange rate of P47 to the dollar, and therefore, bloated by P7.7 billion if the peso appreciates to P44 against the greenback this year,” Recto said, explaining that the government has set aside P357 billion for debt interest payments alone this year, of which P120.8 billion will be used to pay foreign obligations. This is the amount to be paid in interest alone of the principal debt stock, which has escalated to P4.68 trillion as of October 2010.
Recto furthered that using a P44 to the greenback exchange rate would effectively reduce interest payment for foreign debt to P113.2 billion or a savings of P7.7 billion, moreso, another P740 million could be saved from the P7.5 billion allocation for the subsidy of the Metro Rail Transit (MRT) 3 system this year since it was based on a currency rate of P50 to the dollar, at an exchange rate of P44 to the dollar, the subsidy savings would be P740 million.
“According to estimate of the banks and financial analysts, savings from interest debt payments and MRT-3 subsidy could further increase should the peso appreciate to P41 to P42 to the dollar,” Recto said, stressing that the President can realign savings for calamity fund.
“Aside from urban dwellers to be affected by flash floods, the most severe blow will affect the agriculture sector and the farmers every time a powerful typhoon strikes,” he said, pointing out that savings channeled to the calamity fund to help the citizenry in the countryside who always bear the brunt of devastating typhoons particular the farmers who need help to move on.
Meanwhile, the government estimates that the damage from current floodings and heavy rains in Mimaropa, Bicol, Central Visayas, Eastern Visayas, Northern Mindanao, Davao, Caraga, and Autonomous Region in Muslim Mindanao may reach to Php 8 billion.
The National Disaster Risk Reduction and Management Council (NDRRMC) initially reported that property damage caused by heavy rains stood at P1.626 billion. Of this, P1.19 billion constituted infrastructure damage, P417.7 million accounted for agricultural damage and P21 million for destroyed private properties.
A total of 309,002 families or 1,580,543 people in 1,795 barangays of 25 provinces were affected by two weeks of heavy rain as the country sails to 2011 according to NDRRMC. (Jason de Asis)
In : SENATE BEAT