BAGUIO CITY, Philippines - Finance Secretary Margarito Teves said the government has $3 billion (P138.7 billion) in pledges and about $1.4 billion (P64.7 billion) to $2 billion (P92.5 billion) in consolidated public sector capital to fund the restoration and rehabilitation of farms and communities ravaged by strong typhoons in September and October.

But Teves may need to raise more because feedback from local investors and economists in calamity-stricken Cordillera showed that government should develop new and more expensive road systems and other facilities that can endure extreme weather, said Budget Undersecretary Laura Pascual.

Teves led a post-disaster economic rehabilitation road show in Dagupan City on Thursday and here on Friday to draw the cooperation of local businessmen in financing or monitoring the restoration effort in Luzon.

Teves, chair of the Special National Public Reconstruction Commission, said the successive typhoons-– Ondoy and Pepeng—cost the country P217 billion in damage and opportunity losses, which represents 2.7 percent deducted from the gross domestic product this year.

The Department of Finance found the heaviest damage in Metro Manila (P28.1 billion), Southern Tagalog (P20.7 billion) and the Cordillera (P3.8 billion), Teves said.

The heaviest economic and social losses were in Southern Tagalog (P55.8 billion), Central Luzon (P37.7 billion) and Metro Manila (P23.9 billion), he said.

Filipinos felt the impact of these calamities when prices of fruits and vegetables increased by as much as 50 percent in October, said Deputy Director Ernando de Leon of the Bangko Sentral ng Pilipinas.

Metro Manila’s vegetable supply comes from farms in Benguet and Mountain Province. Most of the supplies were trapped in Baguio when the city was isolated by landslides in early October.

The calamities resulted in a headline inflation rate of 1.6 percent in October, an increase from the 0.7 percent headline inflation posted in September, Teves said.

He said it would take $4.4 billion (P203.5 billion) to speed up restoration work in two years.

But these tragedies have already been established as consequences of climate change, “not just freak occurrences that would never be repeated,” said Juan Ngalob, Cordillera director of the National Economic and Development Authority.

Ngalob helped conceptualize the Cordillera Road Improvement Project (Crip), an infrastructure framework plan that is meant to open up more road access into the mountain regions.

But because of the gravity of the storms that are projected to hit the country in the future, Ngalob said portions of this road network must be redesigned to address extremely high rainfall.

He cited a Mines and Geosciences Bureau report which indicated that “Pepeng” unleashed 685 millimeters of rain in 24 hours on its second pass across the Cordillera.

Ngalob said the MGB report indicates that 150-mm rainfall in 24 hours already triggers rock and mudslides.

Most roads in the Cordillera receive standby funds yearly, which are dedicated only to clearing landslides, because these occur frequently in the region, according to the Department of Public Works and Highways.

Pascual said the reconstruction commission had already factored in the possibility that new technology and more expensive infrastructure projects could be more cost-effective than maintaining old roads and facilities.

“But we may have to consider BOT (build-operate-and transfer). It’s just too expensive for us, and the government must proceed and restore what needs to be restored, like irrigation systems, so the economy can keep growing,” she said.

Teves said the government has been spending far more than it anticipated because of the storms. The country already breached its 2009 fiscal deficit ceiling of P250 billion, when it posted a P266.1 billion deficit in October, he said.

He expected the deficit to stabilize at P280 to P300 billion by yearend or by 2010, when reconstruction expenditures start to strain the national treasury.

De Leon said remittances from overseas workers and migrant Filipinos could increase this month to help with the rehabilitation.

Pascual said government is also making sure rehabilitation work starts before 2010.

In Dagupan City, Leonardo Quitos Jr., Neda Ilocos director, said a total of P3.23 billion is being injected into Ilocos Norte, Ilocos Sur, La Union and Pangasinan to repair damaged infrastructure and to rehabilitate the agriculture and fisheries sectors.
“Infrastructure and agriculture are the sectors most affected by the typhoons and they must be rehabilitated as quickly as possible if we are to ensure that economic growth remains on track,” he said.