The Philippines, particularly Davao Region, is starting the year 2023 with a positive outlook, more than two years since Covid-19 hampered its economy and progress.
National Economic and Development Authority-Davao Region (Neda-Davao) director Ma. Lourdes Lim said while the country ended 2022 with the lingering effects of Covid-19, the outlook for 2023 is positive.
Prices of basic commodities are expected to remain at elevated levels but they will gradually stabilize with better food supply, targeted social assistance via subsidies, lower global oil prices due to the slowdown of the economy, sustained remittance flows, higher employment, and increasing value of Philippine peso.
On top of that, Lim said there will be bright prospects due to sustained operations of the major sectors of the economy as the number of retrenched workers and closure of establishments will further decline, which signals sustained recovery.
In addition, investments are expected to increase as the region targets to be a tourism and investment-ready destination. The region also will be reaching its prospect as an international logistics hub.
The Neda official also said micro, small and medium entrepreneurs (MSMEs) are expected to fully recover and thrive. It is one of the top priorities of the current administration of President Ferdinand "Bongbong" Marcos Jr., recognizing the sector's role in post-pandemic economic regeneration, job creation, and poverty reduction.
Mindanao’s economy
Davao-based economist and Mindanao Development Authority (Minda) Public Relations Head Adrian M. Tamayo forecasted a promising prognosis for the year in the country's growth.
Citing Moody's Analytics’ which also gave an optimistic forecast, Tamayo said the Philippines will demonstrate the fastest GDP growth in the region after observing that the pent-up demand for goods and services of companies and households during the pandemic will buoy the economy into a better position this year.
The Development and Budget Coordinating Committee (DBCC) confirms Moody's Analytics and sets on its own a 6 to 7 percent growth in consideration of the continued reopening of the economy, a noticeable increase in the domestic demand, improvement in the services and industry sectors, and the revitalization of the tourism sector.
While these figures cover the national forecast, he said Mindanao may grow to reflect the forecast drivers.
According to Tamayo, on average, Mindanao may grow from 5.8 percent to 6.1 percent on the lower tail and 6.5 percent to 7 percent on the upper tail.
However, the regions in Mindanao can grow faster than 7 percent this year, especially from the BARMM, Caraga, and Western Mindanao, given the S-shaped growth phases of these regions.
Northern Mindanao, Davao Region, and the SOCCSKSARGEN can grow at the rate of their mature economic engines. Otherwise, it may lead to overheating.
Mindanao can rely on its solid OFW base, which comprises 21 percent of the national figure and sent home an estimated 32.3 billion pesos in 2020.
In addition, he said Mindanao can take full advantage of its improving position in the export of agricultural commodities. The island exports nickel, ores, fish, crustaceans, animal or vegetable fats, bananas, other fruits, seaweeds, and coconut to huge economies like the United States and China.
The stable energy position of Mindanao, posturing more than 20 percent excess supply capacity than demand, makes the island attractive as an alternative investment destination and tourism destination.
“What is needed is to ensure the growth drivers remain in the fast lane of development and mark the island's speed with the milestones of safety, security, and peace across the island,” Tamayo said.
Other stakeholder’s highs and hopes
Gene Bangayan, co-chair, deputy private sector for Micecon 2023, also said they are looking forward that having more meetings, incentives, conferences, and exhibitions (Mice) events in the city and region to jumpstart the economy since it was highly affected when the pandemic hit the region.
Bangayan said this is what they are rallying in the upcoming Micecon 2023 this March.
"For the past month, we've looked at the arrivals, and it's very encouraging for the industry," she said.
Pia Montano, Davao Visitors Destination Hub head, said with the "revenge travel" currently happening, the tourism industry will further prosper.
But she said, the industry continues to face challenges, which needs help.
For Regan C. Sy, CEO and VP for Marketing, he is also seeing full potential for this year especially in the infrastructure sector, especially with the ongoing and incoming projects not only in Davao City, but for the entire Mindanao, particularly the Mindanao Railway Project which is targeted to commence in the first quarter of 2023.
"I think it's going to be a game changer to recognize Mindanao not just as a potential growth area, but really going forward to compete also globally," Sy said.
The relaxing of the restrictions imposed against Covid-19 had also brought confidence among businessmen to reopen and expand further,
“Although we have our threats outside, economic recession and that is looming and dampening, and the higher interest rates, but going forward I think people will manage those factors but their plans will still go forward,” Sy said. RGL