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Freeman Cebu Business

Sunny side of destruction

FULL DISCLOSURE - Fidel O. Abalos - The Freeman

Just thirty-five days apart, two major disasters struck the Province of Cebu. The tremor on September 30, 2025 and Typhoon Tino on November 4, 2025. While equally devastating, it is revolting to note that the latter brought about the bad side of some Cebuanos. Reportedly, some business establishments and residences were looted. 

We can’t help but be reminded of what Eli Raphael Roth, an American film director, producer, writer and actor of horror movies, once said. That “Natural disasters are terrifying-that loss of control, this feeling that something is just going to randomly end your life for absolutely no reason is terrifying. But what scares me is the human reaction to it and how people behave when the rules of civility and society are obliterated.” 

Indeed, natural disasters will always be horrible. However, what is more terrifying is what Eli Raphael Roth must have observed in countless of disasters that struck mother earth, the peoples’ behavior. This quote mirrors that candid reality in Metro Cebu about two weeks ago. The lawlessness, like looting, that obtained during and right after Typhoon Tino braces through.

However, as we struggle to gather whatever are still considered useful from the rubbles left by Typhoon Tino, let us set aside these unpalatable experiences and ponder a bit on the economic well-being of the Province of Cebu and its people. Clearly, losses are in billions of pesos, no doubt about that. However, as has always been the case even in the most advanced countries (that have suffered catastrophes), these figures are inaccurate and are normally overstated. To better understand it, let’s identify where losses could be without even attempting of quantifying it.

For one, in terms of losses (on businesses), the decline in values may be measurable but lost income is quite difficult. For instance, the losses on agriculture, are harder to quantify. Either one may determine the amount spent so far in raising the crops and consider all accumulated costs as losses or peg the losses on the potential income of said crops upon harvest. Whatever the methods shall be, the fact remains that losses were incurred. 

On the other hand, the decline in the value of the structures of the department stores, factories, etc. maybe figured out but the amount that should have been earned out of profits had business remained uninterrupted is harder to determine. In both instances, however, losses are definite. So that, to those affected, tax payments (for national and local) will substantially reduce for the time being.  Moreover, whether properties are residential or used in business, the local government units (LGUs) will suffer as well. With the decline in values of these real properties, collection of real property taxes will certainly plummet. Worst, it may even be brought down to near zero (in some LGUs) as the supposed taxpayers are still reeling from the current devastation.

As in most tragedies, after the search, rescue and retrieval operations, rebuilding follows. Again, analyzing the country’s GDP on the spending side, the main drivers are the government’s infrastructure spending and consumer spending. Certainly, these two main drivers will heavily figure out in the next couple of months or years. For one, with several bridges, kilometers of roads and countless of public schools, hospitals and other publicly owned buildings destroyed, the government will set aside huge amounts for their reconstruction. Therefore, expect that as we start rebuilding, we shall see a lot of opportunities we’ve never seen in normal times. 

However, this is the tricky and most sensitive part. Yes, amid heaps of debris, clearing operations present countless of chances even to those lacking in skills or inadequately educated. Construction workers will be in demand as the government speeds up the restoration of school buildings as well as stretches of roads and bridges. However, if the government awards these money-making activities to contractors outside of Cebu, the recovery efforts might be dented a bit. For one, the non-resident contractors already have their own workers and might just bring them to the ravaged province, thus, denying the locals the opportunity to earn a living. Moreover, the income it generates from the contract shall go out of the province, thus, siphoning the amount from it and denying the place the much-needed multiplier effect of such money. 

Thus, despite all the criticisms on inefficiencies and insufficiencies this government has so far endured, it can make it right if it will try to make a way for Cebu-based contractors to undertake the reconstruction activities. 

In doing so, not only shall we be able to rehabilitate our province, we shall also be able to rebuild ourselves.

ELI

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