It is too early to assess the damage of Taal Volcano's eruption on the Philippine economy. Scientists are still monitoring the behavior of the volcano and are not discounting the possibility of a catastrophic eruption in "hours or days" despite a "lull" in spewing ash.
The volcano on Sunday produced a towering burst of ash that reached 800 meters in the sky, and jets of lava. Ashfall blanketed the towns surrounding Taal Lake and reached as far as Metro Manila.
Southern Luzon provinces are bearing the brunt of Taal Volcano's initial eruption, with the livelihood of fishermen and livestock producers around the lake completely disrupted. Philippine National Bank in a market report noted that the Southern Tagalog region is a main contributor to the supply of livestock and fish nationwide.
It cited government's initial damage estimates of P74.5 million on agriculture in the CALABARZON region, adding 6,000 fish cages might be at risk due to the high sulfur content caused by the eruption.
National Grid Corporation of the Philippines, the operator of the power transmission network, meanwhile, reported low power reserves as several plants and transmission facilities in southern Luzon were affected by Taal Volcano's eruption. Over 3,000 megawatts of capacity from Batangas and Laguna provinces were not available Thursday because of power line constraints amid Taal's eruption and the accompanying ashfall, limited operation of several plants and forced outages.
Taal Volcano could also disrupt the operations of manufacturing companies in the economic zones of Batangas, Cavite and Laguna. Region 4-A, comprising of the provinces of Cavite, Laguna, Batangas, Rizal, and Quezon, or CALABARZON, accounted for 17 percent of the country’s gross domestic product in 2018.
The government, thus, should limit the impact of the volcanic eruption on the economy. It should immediately draw up rehabilitation efforts to restore economic activities in CALABARZON, and extend emergency credit facilities to small farmers, fishermen and livestock producers, who have quickly lost their livelihood.
The government, in addition, should delineate and enlarge the permanent danger zones around the volcano and the lake to prevent the loss of life.
