...the tiger economy in the making

Philippines to become $1-trillion economy by 2030

ABS-CBNnews.com

05/20/2014 9:39 AM

From 'pussycat' to 'tiger' economy

MANILA, Philippines - The Philippine economy is projected to hit $1.2 trillion in 16 years or by 2030, according to a report by IHS.

"The Philippines economy has undergone a remarkable transition from a pussycat into a tiger economy over the last decade," Rajiv Biswas, Asia-Pacific chief economist at IHS, said in a statement.

IHS, a leading provider of global market and economic information, said the Philippine economy has a capacity for long-term economic growth of around 4.5 percent to 5 percent a year between 2016 to 2030. Last year, the Philippine economy grew by 7.2 percent, one of the fastest in the region.

"This (growth) will transform the Philippines economy from its current $280 billion economy to a $680 billion economy by 2024, with a projected GDP of $1.2 trillion by 2030,”

By 2024, IHS projects the total GDP per Filipino will rise to $5,800 (around P254,000) from around $2,800 (around P122,000) this year.

"This has considerable implications for the size of the Philippines consumer economy. These significant increases in per capita GDP will create one of ASEAN’s largest consumer markets of the future, as the middle class rapidly expands over time," Biswas said.

The Philippine economy's growth will be driven by the IT-business process outsourcing (IT-BPO) sector and continued strong flow of remittances from overseas Filipino workers.

The IT-BPO sector's export revenues more than doubled between 2008 and 2013, hitting around $13.3 billion. Remittances from OFWs reached $25 billion in 2013.

"The rapid growth of the IT and BPO industry is also creating positive transmission effects for the rest of the economy, including rapid growth in demand for commercial floor space, underpinning the development of existing and new office parks in urban centers," Biswas said.

However, the long-term outlook for the Philippines' future development will depend on its ability to make the manufacturing sector more competitive and to attract foreign and domestic investments in manufacturing, IHS said.

"This will require considerable improvement of the business climate, with the Philippines still ranked very low globally on the World Bank’s Ease of Doing Business rankings," he said.

The Philippines, Biswas said, also faces challenges such as "very high" poverty and unemployment incidence.

"However, sustained rapid growth will require continued economic reforms to improve the business climate of the Philippines, making it more attractive for foreign direct investment into sectors such as manufacturing and tourism," he said.

...the emerging city of tomorrow

Why UN Habitat named CDO an ‘emerging city of tomorrow’

 

By Mozart Pastrano, Ninfa U. Along-Albania
Philippine Daily Inquirer

Monday, May 19th, 2014

Cagayan de Oro City (CDO) has been named an “emerging city of tomorrow” in this year’s World Urban Forum in Colombia organized by the United Nations Human Settlements Programme (UN Habitat).

 

CDO is the only Philippine city on the list, which includes Hunchun, China; Johor Bahru, Malaysia; Malmo, Sweden; Nampula, Mozambique; Onitsha, Nigeria; Santa Marta, Colombia; Tetouan, Morocco; and Uberlandia, Brazil.

 

CDO is ranked by the National Competitiveness Council as the Philippines’ most competitive city.

 

The mayor of CDO is former Misamis Oriental 1st District Rep. Oscar S. Moreno.

 

The city government has pioneered in the computerization of business permits and licensing, as well as the assessment and payment of real property tax.

 

“Getting a business permit takes up less than an hour,” said Eileen Canoy Escobar-San Juan, the city’s local economic and investment promotions officer.

 

She also noted that a key driver in the city’s remarkable growth was the “very strong private sector support and initiative.”

CDO is the growth driver of Northern Mindanao (Region 10), whose economic growth continues to exceed those of the other regions in Mindanao.

 

CDO’s gross regional domestic product (GRDP) was P240 billion in 2012, up by 7.4 percent compared to its 5.8 percent growth in 2011. This was largely due to the acceleration of the industry and services sectors, which rose by 9.2 percent and 9.0 percent, respectively.

 

Although agriculture stepped up by only 2.4 percent, contributing 28 percent to the region’s economy.

 

Nationwide, Northern Mindanao (Region 10), which includes CDO, ranked third in per capita GRDP.

 

Dynamism

 

Fueling the region’s growth is CDO’s economic dynamism, government efficiency and appropriate infrastructure. New industries utilizing information technology are being established in the city.

This fast-growing city of over 600,000 people provides easy access to an enormous concentration of markets in Northern Mindanao.

 

The Mindanao Container Terminal (MCT) facilitates direct and cost-efficient movement of containerized cargoes to Manila, Cebu and international shipping hubs.

 

The multi-berth Cagayan de Oro Baseport handles inter-island passenger travel with connectivity to the country’s nautical highway and the logistics corridors of Mindanao.

 

Laguindingan Airport services air logistics requirements, while an extensive road network leads to and from the major production areas and markets of Mindanao.

 

The expansion of the MCT and Filinvest Development Corporation (FDC) Power Plant will consolidate CDO’s position as the largest logistics center in Southern Philippines.

 

While the rest of Mindanao has been experiencing severe power shortages for many months now (with up to 16-hour outages daily in one Mindanao city), CDO has been hit by brownouts only at the tail end of this summer.

 

That’s because it is approaching self-reliance in power: with Minergy’s 27.4-MW and 18.9-MW diesel power plants, STEAG State Power’s 210-MW coal-fired power plant—plus Bubunawan Power Company’s 7-MW run-off river hydro project in tandem with Cepalco’s 1-MW photovoltaic solar power plant—the only grid-connected PV power plant in the Philippines.

FAMILIES visiting their deceased relatives and staying overnight in Bolonsery public cemetery last Nov. 1. Right: Uncompleted bridge over Iponan River connecting Bulua with Opol.Once completed the bridge should be part of a new coastal artery crossing Cagayan de Oro.

Complementing the logistics infrastructure of Cagayan de Oro is the rapid modernization of the city’s telecommunications infrastructure, transforming the city into a business center and international logistics and telecommunications hub of the south.

 

Educational center

Beyond infrastructure, CDO is the center of education in Mindanao. Xavier University-Ateneo de Cagayan is Mindanao’s first university—and, in fact, is the first Jesuit university in the Philippines.

 

Capitol University and Liceo de Cagayan University are cited by the National Association of Colleges and Universities as among the country’s top 10 higher education institutions with the largest number of accredited programs.

With 15 universities and schools, CDO accommodates 82,000 students and 22,000 graduates every school year.

 

Custom-designed skills training and apprenticeship programs are readily available to serve human resource requirements. For example, Xavier University has partnered with Asian Carmakers Corp., the country’s official BMW distributor, to bring German automotive expertise to technical education students.

 

CDO’s strategic location and rich agricultural resources have made it the preferred site of major agribusiness companies such as Del Monte Philippines (which set up the world’s largest integrated pineapple processing plant here), Nestlé Philippines, Pilipinas Kao and other small and medium agri-based industries.

 

As a gateway to Southern Philippines, CDO provides direct access to rich agricultural areas in Mindanao—the source of 40 percent of the country’s food and livestock. CDO is a significant producer of oleochemical and other coconut products.

 

Higher-value products through agro-processing offer investment opportunities. Presently, Northern Mindanao is the top producer of cattle and is the third largest producer of poultry in the country.

 

CDO is also a key destination of meetings, incentives, conventions and exhibitions (MICE) in Southern Philippines. It has 4,806 rooms from various accommodation facilities that can handle conventions with 3,000 participants. It is trying to improve these rather limited numbers.

 

White water rafting capital

COURTYARDS in Carmen Barangay, developed by Pueblo deOro

CDO is the white water rafting capital of the Philippines, attracting ecotourism adventure seekers who also delight in experiencing ziplines and spelunking and diving, among other outdoor activities.

 

CDO is linked to Camiguin, which is renowned for its luxurious beaches, hot springs, waterfalls and historic landmarks; to the mountain ranges of Bukidnon, home to seven indigenous communities; to the Caraga region capitals of Butuan and Surigao with boast eco-tourism thrills; and to the Lanao del Norte nexus of Iligan City and Marawi City, home of the

colorful Maranao people.

Over the years, the Cagayan River has renewed its claim over CDO—the primordial gateway through which flowed the transactions and transformations of people and progress, commerce and culture, ideas and values.

Hit by Tropical Storm “Sendong” in 2011, CDO is a portrait of resilience, said Fr. Roberto C. Yap, SJ, president of Xavier University-Ateneo de Cagayan.


“Usually,” he said, “the word reminds us of the bamboo because of the way it dances with the wind in times of typhoons and then snaps back in place afterwards. But I would like to propose that resilience should mean not just overcoming challenges but prevailing over them to become better, stronger much more than we have been."