World Bank approves $500 million loan to Philippines

The World Bank approved a $500 million loan yesterday to help the Philippines deal with natural disasters. It can access the new credit line following “a state of calamity” declared by the president, the World Bank said in a statement. On average, more than 1,000 lives are lost every year in the Philippines, with typhoons accounting for the majority of deaths and damage.

The country is also highly exposed to earthquakes and volcanic eruptions. “Financial shocks caused by natural disasters undermine economic growth and poverty reduction,” said Philippine finance secretary Cesar Purisima. “This is the environmental equivalent of the middle income trap. Governments need to be agile in mobilizing resources if we are to break free from disastertraps that knock back the poorest and most vulnerable,” he added.

Super Typhoon Haiyan struck the Philippines in November 2013, one of the strongest ever storms to hit land, leaving more than 7,350 people dead or missing. Total damage and losses reached 571.1 billion pesos ($12.9 billion), cutting economic growth by about 0.9 percent in 2013, and another 0.3 percent in 2014, pushing about 2.3 million people below the poverty line as a result, the bank said. Typhoons Koppu and Melor, the two latest extreme weather events that hit the Philippines this year, claimed nearly 100 lives combined according to official counts. It is the second time the World Bank has given the country money to help deal with such catastrophes.—AFP