Wednesday, October 7, 2009
Are we ready to rehabilitate?
If you observed, the entire Luzon is one big disaster area. It was like we were struck by war. Roads, bridges, and other infrastructure critical for trade and economy were damaged. These have an effect in the economy, since this will slow down production and will depress the already depressing situation.
I will not be surprised if government lowers its growth target by this year and the next due to this calamity. It is like just starting over. A negative growth rate would surely affect consumer confidence and foreign investments could also be affected.
In fact, I am just waiting for the official Bangko Sentral ng Pilipinas (BSP) consumer confidence index and I already expect it to be lower than usual. Malls have opened and are all on sale (some even offer up to 70% off items). But no one is biting. It seems that people are still reeling from the dire effects of the calamity.
With whole sections of the country affected by this, it would not be entirely surprising if the much anticipated sub-prime crisis hits us sooner than expected. Vice President Noli de Castro already hinted this when he said that Pag-Ibig would allow a 3-month grace period for home amortization payments. The Home mortgage corporation has been unable to sell their bad and maturing loans.
Some would probably argue that it would take a very strong willed government to effect the changes and pursue rehabilitation efforts in the entire Luzon. We need strong arm tactics to effect recovery, short of saying that a declaration of a state of national emergency is in order.
And I think someone or a group within Mrs. Arroyo's inner circle is just thinking of this. Surely, they can't simply declare this because the Constitution bars them from doing so. Arroyo can only declare such if we were invaded, or there was a rebellion or there is lawless violence.