Marawi City/Lanao Del Sur is the only disaster area I know where the humanitarian aid did not improve the local economy.
I have been to more than 20 disaster areas. The aid, the cash flow, the rebuilding, the capacity building and all that always translate to an improved economy. Call it disaster capitalism if you like.
For example:
1. Iligan City before Sendong had a 3.8 Billion in assets. Three years after the Sendong Rehabilitation, it’s assets grew to 9.2 billion. Now, it’s the third richest city in Visayas and Mindanao with 10.27 billion in assets.
2. Leyte has a high poverty incidence before Yolanda (up to 40 percent). After Yolanda rehabilitation, in 2016, Leyte became the Tenth Richest Province in the Philippines with 7.6 billion assets.
Now, look at Lanao Del Sur.
a. Before the siege : Poorest province at 67.3 percent poverty
b. After the siege, after 20 billion pesos were spent on aid , the poverty worsen to 73.8 percent.
Note: before the siege, the IRA from government to LdS was around 1.4 billion. After the siege, IRA plus AID would mean around 21B poured into Marawi. And yet, poverty incidence rose. It doesn’t add up. Why?
There are a few factors why Marawi or Lanao Del Sur did not benefit from disaster economy:
1. The relief goods including medicines were procured in other cities. That’s 5 billion worth. Tagbilaran supplied the food packs and hygiene kits during the Bohol earthquake. Tacloban, Ormoc and Palompon supplied the relief and even the construction supplies. For Marawi, the procurement was done in General Santos, Cagayan de Oro and Iligan. Those cities benefited.
2. Cash inflows from cash grants, employment of young people etc are spent in Iligan. Families go to Robinsons and Gaisano for their needs.
3. Seminars, workshops, conferences, meetings which are worth millions combined are held outside Marawi – Iligan, Cotabato, Cagayan de Oro, Midway. The owner of Midway opened an entirely new resort and Conference Center because he couldnt accommodate the demand.
4. Logistics such as hotel accommodation of UN staff, car rentals, car purchases are done in Iligan.
5. There is no capital infusion from businesses. When Tacloban businesses were damaged by Yolanda, their corporate offices released funds to rebuild their branches such as Jollibee, McDonald’s, Robinsons, Gaisano, Land Bank and many many more. Marawi doesn’t have that kind of economy.
6. And then of course, COA reported massive corruption in some agencies.
Thus, Iligan and other cities benefit from the humanitarian aid meant for Marawi, more than Marawi itself.
This article first appeared in the Facebook page of Bro Rey Barnido.