Typhoon may devastate Philippines’ economy

While it undoubtedly killed many thousands of people, the economic toll on the Philippines from Typhoon Haiyan actually could have been worse.

The storm took an estimated $14 billion toll on Filipino property, according to tktk. But the path of Haiyan meant it imposed only minor damage in and around the capital of Manila -- home to about 12% of the nation's people and a third of its annual economic output of about $430 billion.

The Filipino economy has been growing faster than 7% a year this year, after growing 6.8% in 2012. By Asian standards, that is pretty good -- it's growing faster than India, if slower than China, It is reasonably well diversified, as business-process outsourcing centers and call centers spring up to complement electronics-assembly factrories and agriculture.

A moderate national debt will work in the favor of Filipino recovery, said Rachel van.Elkan, mission chief for the Philippines at the International Monetary Fund. With an investment-grade bond rating and a debt to GDP ratio of 40% -- compared with TK% for the U.S. -- the nation will be able to finance its reconstruction after international aid pours in to address the humanitarian crisis, she said.

``Things have been looking up for the Philippines,'' van Elkan said. ``In our assessment they continue to do so.''

Metro Manila is the center of the nation's financial services business, and also has the largest share of its manufacturing because of its access to ports, van Elkan said. It is also the largest single home of the outsourcing companies that have boosted employment in the Philippines to as many as 900,000 people, according to consiuting firm Tholons.

Cebu, a city of more than 3 million people where major industries include tourism and outsourcing, was heavily damaged by the storm. U.S. companies with operations there include United Healthcare and tktk, according to Filipino press reports.

Until the storm hit, the Philippines' economy had been expected to grow 6.8% this year, accor! ding to the International Monetary Fund, and actually grew more than 7% in the first half of the year. Its government debt has an investment-grade rating, which Fitch Ratings raised earlier this year, and its consumers spend more freely than in some developing nations, but it had weak infrastructure and relatively high unemployment at 7.5% even before the storm hit, according to an analysis by accounting firm Deloitte in September.

Haiyan's total impact may reach $14 billion (U.S. dollars), said economic consulting firm Moody's Analytics. As many as 9.5 million people, or 10% of the population, may have been directly affected by the typhoon, with half the nation's sugar cane fields and a third of its rice-growing land wiped out, Moody's said.

"The economy has weathered global economic and financial downturns better than its regional peers due to minimal exposure to troubled international securities, lower dependence on exports, relatively resilient domestic consumption, large remittances from four- to five-million overseas Filipino workers, and a rapidly expanding business-process outsourcing industry,'' CIA analysts wrote in the 2013 World Factbook.

Spokespeople for the International Monetary Fund and IHS Global Insight said it's too early to make meaningful estimates of the economic damage.

About 8% of the nation's $430 billion economy comes from money sent back home by emigrants, usually to their families, Fitch said. Another 35% comes from exports.

The $430 billion works out to annual output of about $4,500 per person, placing the Philippines between 122nd and 130th among the 180-plus national economies worldwide, according to analyses by the World Bank, the IMF and the CIA.