Aquino's fate lies with success or failure of Philippine reconstruction

Rosemarie Francisco and Karen Lema
November 20, 2013

By Rosemarie Francisco and Karen Lema

MANILA (Reuters) - The Philippines faces perhaps the most daunting reconstruction task since the 2004 Asian tsunami as it figures out how to rehouse four million people made homeless by a typhoon - and for President Benigno Aquino, the stakes couldn't be higher.

Aquino, under fire for a slow start to relief efforts and a somewhat aloof response to the scale of the disaster, is now feeling the strain from a resurgent scandal involving lawmakers' misuse of public funds.

Typhoon Haiyan smashed into the central Philippines on November 8 killing at least 4,000 people and reducing most of what was in its path to matchwood and rubble. Bodies are still being pulled from the debris.

A successful reconstruction effort, costing as much as 250 billion pesos ($5.8 billion) according the latest government estimate, would make Aquino a hero.

Failure could mean the end of his political career, built on the promise of economic reform and clean government espoused by his martyred father Benigno Jr., a former senator and opposition leader, and his democracy-hero mother, Corazon.

The so-called pork barrel fund is key.

Scandal over the Priority Development Assistance Fund (PDAF) had already become the biggest crisis of Aquino's three-year rule before the typhoon struck. It was widely lambasted for channeling money to projects solely to impress voters, though many of the projects have turned out to be non-existent.

On Tuesday, the Supreme Court ruled it unconstitutional.

Some analysts believe that decision could work to Aquino's advantage as the funds can now go straight to reconstruction efforts.

"The budget department gets approval from the president before it releases funds, so he will remain powerful," said Clarita Carlos, political science professor at the University of the Philippines.

Others think Aquino may have limited flexibility amid questions about the administration's use of the funds, particularly under a Disbursement Acceleration Programme that is also being questioned before the Supreme Court. But Manila is hoping to pass a supplementary budget to fund part of the rebuilding.

"This is going to be the real test of the leadership of the president," said Prospero de Vera, political analyst and vice president at the University of the Philippines.

"He has to exercise very decisive leadership to move the numbers to support his initiatives, not because there is a PDAF waiting for them, but because it is for the good of the country," he said, referring to Aquino's reforms and efforts to pass a supplemental budget for 2013 as soon as possible.

The government has identified immediate and short- to medium-term infrastructure needs requiring funding, ahead of a planned conference in Manila next week where development agencies are expected to pledge aid or loan packages for the government, said Arsenio Balisacan, economic planning secretary.

A successful deployment of resources for rebuilding could further boost growth in a country that is already growing at the same pace as China, he said.

"It's probably anywhere around 100 billion to 200 billion pesos," Balisacan told Reuters, commenting on the likely cost of reconstruction. "I would not be surprised if it goes as high as 250 billion."


The Asian Development Bank (ADB), which has committed itself to a $523 million loan and grants package for the government, says the number could be even higher.

"That's where a more detailed assessment is needed," Neeraj Jain, ADB country representative, told Reuters. He said the Manila-based bank had proposed the creation of a multi-donor fund administered by the ADB to finance the reconstruction.

Resettlement of coastal towns is one of the goals of a reconstruction task force that will assess costs, source financing and oversee implementation of rebuilding plans.

The government says it is considering using land owned and foreclosed by state agencies as permanent relocation sites, although officials estimate not all of the 4.4 million displaced people live in risky areas and need to be relocated.

The creation of a strong reconstruction agency, with a clear mandate, funding and plans, could spell success, as seen from in rebuilding in the Indonesian province of Aceh after the 2004 tsunami, said Abhas Jha, sector manager overseeing disaster risk management for East Asia and the Pacific at the World Bank.

About 140,000 houses were quickly built, 70,000 hectares (173,000 acres) of farmland reclaimed and more than 100,000 people retrained after the tsunami devastated the province on the northern tip of Sumatra island.

Public Works Secretary Rogelio Singson said structures such as houses, hospitals and health clinics, schools and public offices must be able to withstand winds of 250 to 280 kph (155 to 174 mph). Structures destroyed by the typhoon were capable of resisting only 150 kph winds.

Haiyan lashed eastern coasts of the central Philippines with maximum winds of about 300 kph.

Residents in hard-hit coastal towns in Samar and Leyte, which account for over 90 percent of the estimated 4,011 deaths and 1,602 missing from the typhoon, are trying to pick up the pieces of their broken lives, cleaning debris surrounding what used to be their homes.

"I love it here. There are many memories for me so I don't want to leave. I want to rebuild," said Iluminada Rafael, 52, a resident for the past 21 years of Tacloban in Leyte province, where about 90 percent of the city was washed away by five- to seven-meter high storm surges.

"This is our place, the place where we know how to live."

(Additional reporting by Manny Mogato in Manila and Nathan Layne in Tacloban; Editing by Nick Macfie and Robert Birsel)