Yearender 2014: Eventful for biz sector

THE year 2014 was eventful for the business community not only for Davao City but also for the entire Davao Region and Mindanao -- from gearing up for the upcoming Asean Economic Community (AEC) 2015 to attracting big ticket investments.
Here is a review of what business community went through in 2015.

Preparing for the AEC

The business community was busy this year in gearing up for the AEC. Though business leaders and the government said it will not be a "big bang", they underscored the importance of businesses and professionals to prepare and become competitive within the Asean region and also in the global community.

The city brought in national events to prove that it is ever ready to be the next prime destination for big conventions.

The National MSME Summit, which was staged on August 20-21, centered on the theme "Philippine MSMEs: Beating Challenges...Accelerating Innovations" with topics centered on not only the AEC but also being competitive in the global market.

Similar topics were also present during the 23rd Mindanabo Business Conference and the 2nd Brunei Darussalam, Indonesia, Malaysia, Philippines-East Asean Growth Area (BIMP-Eaga) and Indonesia, Malaysia, Thailand-Growth Triangle (IMT-GT) Trade Fair and Business Leaders' Conference.


Mindanao has been experiencing problems with power in the past five or so years and 2014 can be considered as the peak of the Mindanao power crisis.

Last February 27, 2014, most parts of Mindanao suffered from an island-wide blackout brought about when Steag State Power, Inc. (SPI)'s lost control of the reduction of load of its 205 megawatt (MW) coal-fired power plant that resulted to tripping of the Agus Hydroelectric Power Plants.

With the low supply brought by the offlining of SPI's powerplant and the low water supply in the Agus-Pulangi power complexes, Davao Light and Power Company (DLPC) announced a six hour to seven hour and 30 minute brownownts on May 7, 2014.

The Davao City Investment Promotion Center (DCPIC) has estimated an hourly income loss of as high as P6 million among the businesses affected by power outages.

DLPC and Davao del Sur Electric Cooperative (Dasureco) also received a boost in its power supply with the operation of the two Tudaya hydropower plants, with a total capacity of P13.6 megawatts, operated by Hedcor, a subsidiary of AboitizPower Corp.

The 6.6 MW Tudaya 1, which is fully contracted to DLPC, harnesses its generation from the Baroring River while the 7 MW Tudaya 2, which is fully contracted to Dasureco, harnesses power from Sibulan River.

Therma South Inc. (TSI), also a subsidiary of AboitizPower Corp., announced that their 300-megawatt (MW) coal-fired power plant project at the boundary of Binugao in Toril, Davao City and Sta. Cruz, Davao del Sur, is almost complete.


The private sector in 2014 pushed for the establishment of linkages between Mindanao and BIMP-Eaga and the rest of the Asean. Connectivity is seen to be a driver of growth within Davao Region and Mindanao.

One of the initiatives that nears completion is the private-led Davao City-General Santos City-Tahuna-Bitung. The sea route was targeted to begin around late second quarter or early of the third quarter. However, PT Tanaka, the shipping line that will serve the route experienced problems in terms of permits.

Romeo Montenegro, Mindanao Development Authority (Minda) director of investment promotions and public affairs, said that the private sector has tapped a new Indonesia shipping line that will serve the route. This time a chassis Roro (Cha-Ro) will be utilized for the route instead of the traditional shipping container.

He said the Cha-Ro will allow a faster movement of goods and faster turnaround time.

Davao City also got a boost when it comes to domestic connectivity with the recent revival of the Cebu-Davao-Cebu of AirAsia Zest in December and the Davao-Bacolod-Davao route of Cebu Pacific on January.


In 2014, two of the country's largest real estate investors announced their multi-billion investments on land development in Davao City.
Property giant Megaworld is set to develop a P15-billion township in an 11 hectare property in Lanang in the next five to seven years, dubbed as the Davao Park District (DPD), Megaworld's 10th township project and Mindanao's first.

The mixed used development will include residential and commercial condominiums, business process outsourcing (BPO) centers, and food and beverage establishments. They are set to begin the construction of the P1.2 billion Davao Finance Center (DFC), a 15-storey steel and glass state-of-the-art finance center, which is expected to be completed in 2015.

Vista Land, the country's largest homebuilder, also announced that they will be pouring in some P40 billion investment to develop large residential projects in Davao City within the next five to six years.

Davao Region was also able to generate some P11.19 billion in new investments from January to September 2014 according to the Preliminary Annual Performance Report of the Department of Trade and Industry (DIT) 11. The Board of Investments (BOI) registered projects are mostly into real estate, cooling systems, manufacturing, transportation, and agriculture.

Bulk of the investments came from the two big ticket logistics investments -- the P5.72 billion seaport and container yard of the Hijo International Port Services Inc. (HIPSI) in Tagum City and the P2.65 billion Davao International Container Terminal (DICT) of the San Vicente Terminal and Brokerage Services Inc. in Panabo City.


The tourism industry in Davao City got a boost with the staging of the first Big Davao Fun Sale from March 14 to April 14, 2014. The event was the first month-long city-wide sale in the Philippines patterned after international city-wide sales, like the Great Singapore Sale and the Dubai Shopping Festival.

The month long sale was aimed to establish the city as a unique, fun, and preferred shopping and dining destination in the country; to develop a strong shopping and dining segment among travelers to Davao; and to improve the image of Davao City as a thriving destination for business and investment.

The city was also able to strengthen itself as the leading destination for meetings, incentives, conferences, and exhibitions with major national and international events being staged here.

The largest event staged in the city in 2014 was the 2nd Brunei Darussalam, Indonesia, Malaysia, Philippines-East Asean Growth Area BIMP-Eaga) and Indonesia, Malaysia, Thailand-Growth Triangle (IMT-GT) Trade Fair and Business Leaders' Conference, which was staged on October 23 to 26, 2014 at the SMX Convention Center.

The four day event was able to gather 25,000 trade fair visitors and more than 1,500 registered participants and visitors coming from the Philippines, Brunei Darussalam, Indonesia, Malaysia, Thailand, Canada, Japan, Mexico, Netherlands, United States, United Kingdom, South Korea, and Taiwan.

Another major event was the staging of the 1st National Micro, Small, and Medium Enterprise (MSME) Summit last August 20 to 21, 2014 at the SMX Convention Center, SM Lanang Premier. It gathered more than 700 participants coming from all over the country.

The Region's tourism industry also got a boost with the inscription of the Mt. Hamiguitan Range Wildlife Sanctuary of San Isidro, Davao Oriental in the Unesco World Heritage on June 2014.

Davao Oriental Governor Corazon N. Malanyaon said the Tourism Infrastructure and Enterprise Zone Authority (Tieza) has approved some P15 million for the development of tourism centers in the municipalities of San Isidro and Governor Generoso and Mati City.


The agriculture sector has continued to power the economy of Davao Region in 2014, as evident on the region's export commodities. Data from the Philippine Statistics Authority (PSA) showed that in the second quarter of 2014 the top five most exported commodities are all from the agricultural or agribusiness sector.

Topping the list is fresh or dried bananas, including plantains at $355.68 million, followed by coconut (copra), palm kernel or babassu oil and its fractions ($111.83 million); fresh or dried coconuts, brazil nuts, and cashew nuts ($36.73 million); fresh or dried dates, figs, pineapples, avocados, guavas, mangoes, and mangosteens ($30.16 million); and fruits, nuts and other edible parts of plants ($19.68 million).

Pilipino Banana Growers and Exporters Association (PBGEA) executive director Stephen Antig said the banana industry is on its way to normalcy two years after Typhoon Pablo struck with around 80 percent of some 15,000 hectares that were affected by Typhoon Pablo being rehabilitated.

The cacao industry also took off the ground this year with a number of major events organized by industry player. One of them was the 1st Davao Chocolate Festival at SM City Davao in September, featuring the top chocolate producers in the region.
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