Monday, May 07, 2007 Is GenSan's economy on brink of collapse? By Rommel G. Rebollido
CARRYING a huge tuna on his shoulder, a burly man burnt by the sun breathes heavily as he finds his step on a boat's gangplank to get the fish to a scale.
As he approaches, colleagues help him hook the big catch on the weigh machine as a classifier pricks the fish to check its quality.
The scene depicts the daily business routine in the General Santos City Fish Port Complex, where officials estimate a cash circulation of about P35 million daily, on fish trading alone.
This city's economy, anchored mainly on the fishing industry, apparently refuses to stop breathing despite overwhelming odds like much publicized deadly bomb explosions, some even hitting the fish port, years back.
But recent developments, particularly on the proposed re-flagging of Philippine fishing fleets in Indonesian waters, have apparently raised another cloud of uncertainty on the future of the only city in the Philippines with the popular moniker "GenSan."
Plea for help
Will the industry that built GenSan continue to flourish? Is GenSan's economy on the brink of collapse?
GenSan folks may yet get a clear answer to such questions as the plea for help by industry leaders appear to be drowned by the blare of the forthcoming local elections, pundits observe.
Local tuna industry leaders view the re-flagging as detrimental because it will eventually limit the access of Philippine fishers to tuna rich waters inside the Indonesian exclusive economic zone (IEEZ).
Currently, Philippine tuna fleets, licensed under a temporary agreement that ends in December, can catch tuna and tuna-like species within the Pacific and Indian Ocean areas of the IEEZ. Licensed vessels are given access to 10 Indonesian ports for offloading and re-supply.
"Our stand is to have our own vessels carry the Philippine flag. This is very important to us since it concerns the promotion of our own identity in international operations," said Marfenio Tan, president of the Socsksargen Federation of Fishing Associations and Allied Industries Inc. based in General Santos.
Barely three decades after becoming a city, this once dusty windswept farmers' resettlement area has grown into a highly urbanized center, earning the tag of "Tuna Capital of the Philippines."
It is also the Philippine's gateway to BIMP-Eaga, one of the potential economic corridors in Southeast Asia.
Aside from the fishing industry, city officials said GenSan has also been moving along new technology trends and is positioning itself as an alternate information-communication technology (ICT) hub in the country.
The Department of Trade and Industry said there has been so far a noted influx of ICT investors in the city, opening new job opportunities for GenSan folks.
Such development prompted planners to look into the possibility of establishing a GenSan ICT park.
City Hall officials said they have started preparing the coming generation to be computer literate by establishing computer centers in 39 public elementary schools.
Several schools in the city have started offering English courses tailored-fit to the outsourcing industry, providing competencies and skills for aspiring call center agents.
All these moves, DTI said, are anchored on the vision that GenSan, which was practically built by the fishing industry, "will be a globally competitive economy and a livable city with healthy, well-educated and responsible citizens actively taking part in governance."
Economic backbone
Agriculture plays an enormous role in GenSan's economy with the fishing sector at the forefront of trade and commerce. Close to 150,000 city folks are directly and indirectly dependent on this sector.
GenSan hosts the Philippine's biggest tuna fishing companies that send out purse seine and long-line fishing vessels to the Celebes and the Pacific Ocean.
Each month, 50 commercial fishing companies unload approximately 8,500 metric tons of sashimi grade tuna, which cater to the needs of leading hotels and restaurants in Metro Manila, Hong Kong, Japan, Canada, Europe and the United States.
The direct revenue to the fishermen exceeds P4.5 billion while the frozen sashimi-processing sector, which largely depends on them, exports over P2.5 billion in finished steaks and sashimi blocks yearly.
If the steadily rising air cargo volume from this city is to be an indicator, the demand for tuna products appears to be increasing and local exporters are easily coping with providing supply.
Six of the eight tuna canneries in the country are currently located in this city with annual export revenues of up to US$400 million.
At the sprawling fish port complex where some 400 metric tons of fish are unloaded daily, officials estimated a cash circulation of about P1 billion each month based on fish landed.
The figures are expected to go further up with the expansion of the fishing port. Now under construction are two wharves measuring 500 meters, a 1,500-metric ton capacity cold storage facility, wastewater treatment plant and a power substation, as well as the installation of a port-handling equipment.
The expansion project is mainly funded by a loan agreement between the government and the China National Constructional and Agricultural Machinery Import/Export Corporation,
Tan said the completion of the fish port expansion would eventually help the local tuna industry cope with the stringent quality standards imposed by various international markets such as the European Union and the United States.
He particularly cited port compliance with the Hazard Analysis Critical Control Point (HACCP), a major fish handling and safety regulation being implemented by the European Union for fish products entering its markets.
At present, there are more than 2,000 personnel of fishing firms and processors trained and well-skilled to carry out HACCP.
The HACCP is a system of food safety and quality control to identify potential quality and safety problems. It is applicable to the fish production chain from harvest to consumption.
Other potentials
The city has also embarked on efforts that focus on other food production ventures with General Santos still having wide tracks of land spread in the city's 26 barangays.
"We are looking into huge potentials for sugarcane plantation and fruit orchards, particularly mango," Mayor Pedro Acharon once said.
Experts have found out that the mainly sandy-loam soil of the city is suitable for sugarcane, while the lime soil in hilly portions is ideal for mango and other fruit orchards.
He said some 150,000 fruit-bearing mango trees planted since 1995 shall be ready for harvest within the next three years.
On agricultural manpower, Acharon said farmers in the city are highly skillful and get continuously trained on new farm techniques and technology.
Emerging export products
The city's total exports in 2004 posted US$381 million with canned tuna topping the list, accounting for more than 40 percent or about US$153 million.
The top five exports include crude coconut oil worth $82,253,074 million, canned pineapple at $77,281,009 million, frozen yellow fin tuna loins/round/chilled/steak/fillet at $22,338,639 million and fresh tuna chilled/loins/ round at $6,385,475 million.
Notably, GenSan's canned tuna exports that year increased by 14 percent or about US$153 million compared to the US$134 million in 2003.
Canned tuna shipments from GenSan's canneries reached 92,517.58 metric tons that same year.
The major canned tuna markets were Europe at 46 percent, US at 42 percent, Japan at 5.6 percent, Canada at 1.7 percent and China at 1.5 percent. Middle East contributed about 0.64 percent, Korea at 0.11 percent, while Taiwan and Hong Kong shared a minimal 0.05 percent.
On fresh and frozen processed tuna exports with a total value of more than US$30 million, at least 54 percent of which were shipped to the US while the balance was shared by Japan, 24 percent, and Europe, 7.2 percent. The Middle East accounted for 2.2 percent and China with 1.47 percent.
In 2005, the tuna value-added sector has emerged as a major export earner, generating revenues worth US$11.5 million.
The Department of Trade and Industry noted that the city's tuna value-added ventures are fast developing into another industry and is now composed of 23 micro-, small- and medium- sized enterprises employing at least 500 workers.
The value-added tuna exports are in the form of chorizo, longaniza, patties, spring roll, kekiam, sausage, chicharon, embotido, siomai, lumpia, nuggets and barbecue.
One successful firm in this sector, A & J Seafoods grew from an initial capital of P1.5 million to a P40-million business.
A&J Seafoods, owned by Aurora Capitulo Amagan, has been repeatedly cited by international bodies for its quality tuna products.
Sound partnership
City officials described the private sector's relation with the City Government as "very cooperative."
They said the government has built enough infrastructures to support the requirements of the business sector and investors.
On the part of the City Government alone, the mayor said they have completed some P84 million worth of infrastructure projects. There are 37 other projects, mostly on drainage and road expansion, up for completion.
GenSan has the amenities of a modern metropolis -- wide thoroughfares, cheap electricity, efficient telecommunication facilities and an array of close to 50 banking institutions.
It boosts of a huge airport that was built according to international standards.
Its runway extends to 3.2 kilometers, allowing it to accommodate even the C-5 Galaxy, the world's largest military transport plane.
GenSan's Makar Wharf has one of the country's best harbors. The port facility has advanced handling facilities that help provide cargo ships and inter-island ferries quick turnaround time.
The hotels and restaurants in the city are coping with standards, Acharon said.
The city has branches of popular food chain Jollibee, McDonald's, five Dunkin Donut shops, a KFC store, Shakey's, Pizza Hut, Greenwich, Mister Donut, Goldilocks and several other popular food shops.
Three shopping malls, KCC, Gaisano and RD Plaza, boost of facilities comparable to huge malls in Metro Manila.
Acharon said the bigger malls like SM and Robinson's are just waiting for the city's population to reach the half-million mark and "I think we just did last year, aside from the increased in population of nearby towns and provinces."
Robinson's already owns a prime eight-hectare lot near the other malls at the city's commercial center.
Businessmen's confidence
With the apparent resilience in its economy, GenSan continues to gather momentum in its bid to become an ideally livable yet competitive city in the next five to ten years.
Already, the city posted total revenue earning of P713-million in 2005, a collection higher by P57-million compared to that of 2004.
City Hall said the higher collection indicates the business sector's confidence in the local economy and city administration.
Such an encouraging development allows GenSan to be sustainable and progressive as it takes necessary measures to protect and preserve its economic gains.
GenSan has one of the best investment codes among local government units in Mindanao. It offers incentives and tax holidays of up to nine years.
For an investment worth over P100-million, an investor gets tax holidays for five years; seven years for P200-million to P300-million worth of investment; and nine years for more than P500-million.
