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Dry Spell Hits Philippines Economy
Manila (AFP) Aug 08, 2007 A worsening dry spell in parts of the Philippines is destroying crops and hampering power generation, causing price rises that have hit the poor and sparked inflation fears. More than 127,000 hectares (314,000 acres) of farmland have withered in the northern third of the country after lower than normal rainfall in June and July, the civil defence office said. The weather office has warned that the low rainfall in the north risks developing into drought conditions if the dry spell persists into next month. "Given that there are so many farmers affected by drought, the effect on poverty could be substantial," Sheila Encabo, a senior official at the economic planning department told AFP. Rice and corn farms that rely on seasonal rain for irrigation have been devastated, as have some 41,000 hectares of fishponds. The agriculture department said corn production in the first half of the year was below target, and Agriculture Secretary Arthur Yap said the effects of the dry spell meant it would now be difficult to achieve the country's production growth aims. But he said the losses could be made up for in other areas, noting that the central and southern islands, where coconuts, bananas and pineapple are farmed, had normal rainfall. Power generation has also been hit by falling water levels. Manila suffered power outages last month with hydro-electric plants grinding to a halt as rivers dried up. Utility companies are now planning to cut water supplies to the capital from August 16, and the air force has been cloud-seeding to try to bring on rain. Agriculture accounts for just under a fifth of domestic economic output but it employs some 19 million Filipinos, or about 35 percent of the labour force. Farm hands form a large part of the 40 percent of the population that lives on two dollars a day or less. The last dry spell in the Philippines affected 68 percent of the country and cut agricultural output by 6.6 percent in 1998, when rice yields plunged 43.6 percent and corn 26.6 percent. Dennis Arroyo, deputy director of the economic planning department, told AFP the government's 6.1-percent economic growth target for 2007 remained in place, but warned a prolonged drought could cause food price inflation and worsen poverty. "The drought is doing some damage, but there are some measures in place," he said. Yap said these include providing emergency aid to drought-hit farmers, higher government spending on irrigation and persuading farmers to switch to crops that require less water. For the government as well as economists, the other emerging threat is the revival of inflation. Consumer prices rose at a higher than expected clip of 2.6 percent in July as the dry spell pushed up the cost of food. Central Bank governor Amando Tetangco said the seven-month inflation figure was still within its 2.6-3.1 percent full-year forecast. "This continues to support our view of a manageable inflation environment. Nonetheless, we are mindful of the risks to this view, which include volatility in oil prices, possible weather disturbances, increases in wages and transport fares," Tetangco said. "If the drought continues, there will be pressure to push up prices," warned Jonathan Ravelas, an economist at Manila's Banco de Oro. Yap said he would back controversial proposals to give President Gloria Arroyo emergency powers to deal with the drought. Such powers would allow her to get relief projects off the ground quickly, bypassing the government's supply procurement rules and other red tape.
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China Braces For More Disasters As Tropical Storms Approach
Beijing (AFP) Aug 08, 2007China braced for more killer weather on Wednesday as two tropical storms approached, continuing a devastating spell of natural disasters that last month left nearly 900 people dead or missing. More than 20,000 people were evacuated from their homes and 50,000 vessels ordered to return to shore in southeastern China's Fujian province as tropical storm Pabuk neared after lashing Taiwan, the official Xinhua news agency said. Pabuk was expected to make landfall late on Wednesday between Fujian and Guangdong provinces, with tropical storm Wutip not far behind, the China Meteorological Agency said. |
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