THE global economic slump has taken a toll on Northern Mindanao’s regional gross domestic product (GDP), which is expected to dip at 3.7 to 4.7 this year.

Engr. Leon Dacanay Jr, officer-in-charge and regional director of National Economic Development Authority (Neda-10), said the slowdown is brought about by the prevailing negative economic outlook in the United States and Japan.

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The two giant economies, Dacanay said, are still in recession that is worsened further by the sluggish China economy.

The effects, he said, are felt worldwide, even rippling through local economies.

Because global economic crunch counts as its victims the export and investments sectors, Northern Mindanao can’t expect a lesser economic impact being an export-oriented region. This adds to the grim outlook of the region’s GDP growth rate, Dacanay said.

This situation is made more complicated by the widening deficit in the national budget because of tax revenue leakages, the Neda official said.

"The situation warrants more and more tax revenues to pump-prime our economy," he said, adding that this has even prompted the national government to move the deadline to balance the budget from 2008 and 2010 to 2011.

To cope with this, Dacanay said regional economies and the national government in general have adopted an "expansionary yet prudent" fiscal policy.

Under this approach, the national government would realign the budget to "fast-moving infrastructure projects and front-loading of resources," he said, adding this requires the full utilization of 80 percent of the internal allotment in the first semester of the year.

"Under this fiscal policy, therefore, the key growth driver for this year would be the construction sector," he said.

Citing target estimates, he said real estate and business process outsourcing (BPO) sectors would benefit from the global economic slowdown, complemented by positive prospects in agriculture and tourism.

Dacanay said national government aims to protect the most vulnerable sectors by expanding social protection programs and increase their purchasing power. (CBC)