THE economic effects of the events in Mamasapano, Maguindanao will depend on how quickly the issue is resolved, Socioeconomic Planning Secretary Arsenio Balisacan said Tuesday.
Speaking to reporters at a seminar for regional media sponsored by the US Embassy in Manila, Balisacan said the effects could be short-term or long-term, depending on what happens next. “If we put closure to the issue soon, we will not feel it that much. If that is not resolved and it leads to further uncertainty, it will definitely hurt the economy in the long term.”
Balisacan said that if lasting peace in Mindanao is achieved, the economy could grow up to seven or eight percent.
The Philippines posted a 6.1 percent growth last year, a figure considered high by the standards of developing countries.
Baliscan said the potentials for Mindanao are enormous, the region being best suited for agribusiness and having a huge potential as well for tourism, light industries and mining. “The region has so much promise for development.”
He said the development of Mindanao alone could be seen as an additional growth driver for the economy, which is currently fueled by domestic consumption and the services sector.
“Achieving peace will be a game changer. We should not be debating whether we pursue peace or not. It’s a must.”
US Ambassador to the Philippines Philip Goldberg, who yesterday answered selected questions that were submitted beforehand, said they continue to support the peace process for Mindanao and that their efforts will be to support a flourishing economic environment in the region.
He noted that investors will pour in investments if they see opportunities, but will some will hold back and wait until security issues are threshed out, which means some areas will not be attractive investments. He said the US Embassy has community programs and projects throughout Mindanao pertaining to education, such as scholarship programs for students wanting to study in the US.
As for the events in Mamasapano, Goldberg said these are internal issues the Philippine Government needs to work on, including issues involving the passing of the Bangsamoro Basic Law.
Last Tuesday, Goldberg welcomed participants of the seminar and said the relationship between the US and Philippines is rooted on an economic partnership. The Philippines is the 10th largest market for American agricultural products while the US is the Philippines’ top market for its own agricultural goods.
Some $24 billion in bilateral trade occurs each year between the two countries and Goldberg noted that American companies are among the largest foreign direct investors in the Philippines in the fields of business process management and electronics.
For David Whiting, acting economic counselor of the US Embassy Manila, investors want to put in capital in areas where they are certain their investments are safe, not just physically, but also in the regulatory framework. He admitted that he prefers to see the Bangsamoro Basic Law passed to encourage more American investments in the region and create more growth in that area. He said investments by American companies is not as high as in other parts of the Philippines.
“It is my hope that the passage of the BBL will help create the basis for an economic environment in Mindanao that is calmer and more conducive to investment.”
Whiting pointed out that US companies in the Philippines employ thousands and pay some of the highest taxes, which gives them “an important role in driving the economy of the Philippines.”
He noted that the Philippines has some of the lowest foreign direct investments among Southeast Asian economies, which he found “tragic”, considering the advantage in location and the language skills of its workforce.