Taal could pose 'temporary speed bump' to economy: ING Bank

ABS-CBN News

Posted at Jan 14 2020 10:04 AM

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MANILA -- A prolonged disruption in economic activity in the Calabarzon region due to the eruption of Taal Volcano could pose a "temporary speed bump" for the Philippine economy, ING Bank said Tuesday.

Calabarzon or the provinces of Cavite, Laguna, Batangas Rizal and Quezon in Southern Luzon is an industrial and car assembly hub just a couple hours drive from the capital.

The need to keep economic growth momentum going in the face of natural disasters should give the Bangko Sentral ng Pilipinas "ample" space for accommodative policy, said ING Bank economist Nicholas Antonio Mapa.

The Philippines also has a "double headed stimulus" with the current 2020 national budget that was passed on time and the 2019 budget, whose validity was extended until the end of the year.

Taal's explosion, which shrouded large parts of Southern Luzon and Metro Manila with ash, is a concern for food commissaries and property developers in the region, said First Metro Securities consultant Aaron Say.

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The "unwelcome" eruption, with its current effect, is not enough to derail economic growth, Socioeconomic Planning Secretary Ernesto Pernia said Monday.

Bangko Sentral ng Pilipinas Governor Benjamin Diokno said it was "bordering on speculative" to assess the economic impact of the eruption.