Neda: No recovery for export-A A +A
Thursday, June 14, 2012
MOST of the major industries in Central Visayas performed well last year, except for the export sector.
According to the recent economic situation report released by the National Economic Development Authority (Neda) 7, the expected full recovery of the export industry did not materialize in 2011 due to the slow growth of the US economy and the weakening of the European economies.
The report stated that the 60 percent drop in export in the month of December pulled down the total export earnings of Central Visayas for the year amid signs of recovery in the first semester last year.
The value of exported goods of Central Visayas in 2011 amounted to $2.3 billion, lower by 8.5 percent from that in 2010.
Importation of goods likewise declined. Neda 7 reported that the value and volume of the imports of the region dropped by 29 percent and 13.8 percent, respectively.
But Neda reported growth in tourism, transport, business process outsourcing, retail trade, and construction and real estate industries.
Agriculture, which performed dismally in the past two years, recovered in 2011, Neda 7 said.
During the year, volume of agricultural production in Central Visayas increased by 31.4 percent, mainly due to improved performance by the crop sector, which posted a 36.9-percent gain in production.
The tourism industry remained upbeat in 2011. Central Visayas recorded an 8.1 per cent growth in visitor arrivals, with foreign visitors accounting for the bulk of the increase.
The Neda 7 economic report stated that the recovery of international tourism started in 2010 and continued to expand in 2011 with the Department of Tourism recording a 15.9 per cent growth in foreign visitor arrivals.
Central Visayas breached the one-million mark of foreign visitor arrivals during the year.
The shipping sector also managed to grow last year despite rising fuel prices.
Homegrown Cokaliong Shipping Lines expanded its shipping services to include Ozamis-Iligan route and increased trip frequencies to Palompon and Baybay in Leyte; Sindangan; and Dapitan.
Information technology (IT) and IT-enabled services, including business process outsourcing (BPO), continued to expand in the region at an average annual rate of 20 percent.
The industry saw the entry of new companies as well as the expansion of the physical and manpower resources of existing firms last year. As of 2011, total workforce of IT/BPO companies in the region was estimated at about 65,000.
During the year, the value of export sales made by IT/BPO companies located in the region totaled $1.25 billion.
The strong demand for BPO and tourism related facilities and services, a growing demand for residential units in the urban centers, and expansion activities of the retail trade industry paved the way for the continued growth of the construction and real estate activities in the region last year.
Neda 7 cited the entry of big ticket investments, such as the integrated development project of the SM Prime Holdings, as well as the launching of various condo projects by homegrown developers.
Several hotels also opened and underwent major renovations last year following an influx of tourists and corporate transients into the region as a result of a thriving meetings, incentives, conference and exhibition (MICE) market.
The retail industry of Central Visayas, on the other hand, expanded further in 2011 despite projections of a slowdown in the aftermath of the 2010 elections.
Neda noted the opening of new shopping centers like J Centre Mall, Shopwise of Rustan's Supercenters Inc., and Forever 21.
Homegrown local players also expanded their retail operation in Cebu and in the neighboring provinces.
According to Neda 7 the steady growth of the retail industry in the region was driven by a broader consumer market with stronger spending capacities. The purchasing power of consumers in the region, particularly the young professionals, has risen due to the presence of BPO/ IT companies. The outsourcing industry provides higher than average salaries to their workers.
Local tourists including students joining educational tour packages also contributed to the expansion of the region's consumer market.
Neda 7 expected the region’s economy to grow faster this year given the infrastructure spending of the government.
“Tourism, IT, BPO, retail trade, and real estate industries will continue to drive growth of the regional economy. On the other hand, the export sector is foreseen to remain volatile as the European economies struggle with a financial crisis,” Neda 7 said.
Meanwhile, Neda 7 identified the ability of the region to increase the quantity of available, skilled, competent and highly qualified employees as among the concerns of the IT-BPO sector.
Published in the Sun.Star Cebu newspaper on June 15, 2012.