‘Philippine water woes to dampen growth next year’

Growth of the Philippine economy is likely hindered by the shortage of water in the summer season, the National Economic and Development Authority (NEDA) said.

At a year-end briefing at the NEDA headquarters in Manila on Wednesday, Socioeconomic Planning Secretary Ernesto Pernia said the lack of water supply is likely anew given a setback in the two water concessionaires’ plans.

“Or maybe they’ll be pressured to deliver better [services] in the coming year,” Pernia said, referring to west and east zone concessionaires Maynilad Water Services Inc. and Manila Water Company Inc., respectively.

To recall, the Department of Justice, upon the order of President Rodrigo Duterte, reviewed the concession agreements of the two concessionaires with the Metropolitan Waterworks and Sewerage System (MWSS) in 1997, amid “disadvantageous” provisions in them.

One such provision is the prohibition against government interference in rate-setting. Another is for indemnity in case of such interference.

On Wednesday, Manila Water told the Philippine Stock Exchange it received a letter from MWSS informing about the revocation of its contract extension. The concessionaire has until three days to reply.

For NEDA Undersecretary Adoracion Navarro, she expects a supply shortage to have a minimal impact on the economy since the Philippines is now experiencing the tail end of the El Niño phenomenon.

“It will have minimal impact…unlike during the peak of the El Niño,” she said in an interview with the Philippine media.

“In August, we already declared that the El Niño phenomenon had ended…. Tail-end effects lang ito (These are only tail-end effects),” she added.

Navarro said any possible shortage has nothing to do with the concessionaires’ ongoing battle with the government.

“It’s because of the Angat Dam’s water level. We are not reaching the expected water level by year-end. [It’s] not because of the water concessionaires,” she added.

The National Water Resources Board (NWRB) has set a 212-meter target by the end of the year to meet the sufficient water supply and irrigation requirements of Metro Manila and neighboring provinces until next summer.

For the full year, Pernia said the government’s growth target of 6 to 6.5 percent was “achievable” as the country’s gross domestic product picked up to 6.2 percent during the third quarter of the year.

Meanwhile, he said that an expected increase in consumer spending will boost the country’s fourth-quarter GDP growth, which accounts for two-thirds of the year’s growth.

Besides water shortage, possible risks to economic growth are the trade war between the United States and China, natural disasters, volatility in oil prices, and possible delays in infrastructure projects.