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2019 Annual Regional Economic Situationer

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2019 Annual Regional Economic Situationer 2019 ANNUAL REGIONAL ECONOMIC SITUATIONER National Economic and Development Authority MIMAROPA Region Republic of the Philippines National Economic and Development Authority MIMAROPA Region Tel (43) 288-1115 E-mail: [email protected] Fax (43) 288-1124 Website: mimaropa.neda.gov.ph ANNUAL REGIONAL ECONOMIC SITUATIONER 2019 I. Macroeconomy A. 2018 Gross Regional Domestic Product (GRDP) Among the 17 regions of the country, MIMAROPA ranked 2nd— together with Davao Region and next to Bicol Region—in terms of growth rate. Among the major economic sectors, the Industry sector recorded the fastest growth of 11.2 percent in 2018 from 1.6 percent in 2017. This was followed by the Services sector, which grew by 9.3 percent in 2018 from 8.7 percent in 2017. The Agriculture, Hunting, Fishery and Forestry (AHFF) sector also grew, but at a slower pace at 2.6 percent in 2018 from 3.0 percent in 2017 (refer to Table 1). Table 1. Economic Performance by Sector and Subsector, MIMAROPA, 2017-2018 (at constant 2000 prices, in percent except GVA) Contribution Percent 2017 2018 GRDP Growth rate Sector/Subsector GVA GVA distribution growth (in P '000) (in P '000) 2017 2018 17-18 16-17 17-18 Agriculture, hunting, 26,733,849 27,416,774 20.24 19.12 0.5 3.0 2.6 forestry, and fishing Agriculture and 21,056,140 21,704,747 15.94 15.13 0.5 4.4 3.1 forestry Fishing 5,677,709 5,712,027 4.30 3.98 0.0 -1.9 0.6 Industry sector 42,649,103 47,445,680 32.29 33.08 3.7 1.6 11.2 Mining and 23,830,735 25,179,054 18.04 17.56 1.0 -5.5 5.7 quarrying Manufacturing 6,811,537 7,304,895 5.16 5.09 0.4 4.9 7.2 Construction 11,006,722 13,875,546 8.33 9.68 2.2 17.1 26.1 Electricity, gas, 1,000,110 1,086,186 0.76 0.76 0.1 14.8 8.6 and water supply Service sector 62,713,384 68,548,716 47.48 47.80 4.4 8.7 9.3 Transportation, storage, and 14,532,340 15,620,967 11.00 10.89 0.8 7.3 7.5 communication Trade and repair of motor vehicles, motorcycles, 7,005,413 7,491,681 5.30 5.22 0.4 7.6 6.9 personal, and household goods Financial 6,960,718 7,677,428 5.27 5.35 0.5 12.1 10.3 intermediation Contribution Percent 2017 2018 GRDP Growth rate Sector/Subsector GVA GVA distribution growth (in P '000) (in P '000) 2017 2018 17-18 16-17 17-18 Real estate, renting, and 9,352,228 9,606,444 7.08 6.70 0.2 2.8 2.7 business activities Public administration and defense, 6,745,505 7,770,266 5.11 5.42 0.8 8.7 15.2 compulsory social security Other services 18,117,180 20,381,930 13.72 14.21 1.7 12.5 12.5 Gross domestic product 132,096,336 143,411,171 100.00 100.00 8.6 5.2 8.6 Source: Philippine Statistics Authority (PSA) MIMAROPA The industry sector remarkably expanded by 11.2 percent in 2018 from 1.6 percent in 2017, making up 33.1 percent of the region’s economy. Mining and quarrying recorded the highest growth among industry subsectors and among major sub-industries, posting a significant turnaround from negative 5.5 percent in 2017 to 5.7 percent in 2018. This may be attributed to the increased average price of nickel at the world market by 26.5 percent from US$4.68 per pound in 2017 to US$5.92 per pound. The quantity of directly shipped nickel ore and production of mixed nickel-cobalt sulfide also increased by 9.3 percent and 5.1 percent, respectively. The construction subsector also grew faster at an impressive 26.1 percent in 2018 from 17.1 percent in 2017. Manufacturing subsector slightly improved to 7.2 percent from 4.9 percent. The Services sector, which remained the biggest contributor to the region’s economy with 47.8 percent share in 2018, grew by 9.3 percent from 8.7 percent in 2017. Only two of its subsectors registered accelerated growth: transportation, storage, and communication with 7.5 percent from 7.3 percent in 2017; and public administration and defense, compulsory social security with a remarkable 15.2 percent from 8.7 percent in 2017. This may be attributed to the implementation of the third tranche of the salary standardization law, increase in base pay of the military and uniformed personnel, conditional cash transfers and rice subsidies under the Pantawid Pamilyang Pilipino Program, and reduction of income taxes brought by the implementation of TRAIN Law Package 1. The AHFF sector grew by 2.6 percent in 2018. This was, however, slower than the 3.0 percent growth recorded in 2017. The increase was due to the growth of agriculture and forestry subsector, though at a slower pace. Fishing subsector rebounded from negative 1.9 percent in 2017 to 0.6 percent in 2018. This may be attributed to increased value of production and higher demand for aquaculture products. 2 B. Prices, Consumer Price Index (CPI), and Inflation Rate MIMAROPA’s average inflation rate eased to 3.9 percent in 2019 from 5.1 percent in 2018. This was, however, higher than the national average inflation rate of 2.5 percent. All provinces registered lower inflation rates, except Romblon. Occidental Mindoro registered the highest inflation rate with 4.8 percent. This was followed by Romblon and Palawan with 4.2 percent and 4.1 percent, respectively (refer to Figure 1). Lower inflation rates may be attributed to the continued anti- inflationary measures implemented by the government to bring down the prices of major agricultural commodities. For three consecutive months, ease in monthly inflation rates were recorded: 2.2 percent in September, 1.1 percent in October, and 1.8 percent in November. This was contrary to the faster inflation rates recorded in 2018 with 4.5 percent in August, 7.3 percent in September, and 9.0 percent in October. Figure 1. Inflation Rate by Province, MIMAROPA, 2018 -2019 5.9 6.0 5.1 5.1 5.1 4.7 4.8 5.0 4.2 3.9 4.1 3.6 4.0 3.3 3.4 3.0 2.0 1.0 0.0 MIMAROPA Marinduque Occidental Oriental Palawan Romblon Mindoro Mindoro 2018 2019 Source: PSA MIMAROPA All commodity groups except education registered upward price movements compared to the index levels recorded in 2018, which contributed to the region’s 3.9 percent average inflation rate in 2019 (refer to Table 2). Education’s index decreased from 116.4 in 2018 to 114.8 in 2019, registering a 1.4 percent decrease. Among the commodity groups, alcoholic beverages and tobacco recorded the highest CPI of 198.8, higher by 29.3 percent compared to its CPI of 153.8 in 2018. This may be attributed to the current excise taxation system on alcohol and tobacco products. This was followed by food and non-alcoholic beverages and restaurant and miscellaneous goods and services with 128.8 and 116.8, respectively. Communication registered the lowest CPI of 102.5. 3 Table 2. Consumer Price Index, Inflation Rate and Purchasing Power of Peso, MIMAROPA, 2018-2019 Percent Change/ Item 2018 2019 Difference (2019/2018) Average Consumer Price Index 117.6 122.2 3.9 Food 126.6 128.3 1.3 Food and Non-Alcoholic 126.5 128.8 1.8 Beverages Alcoholic Beverages and 153.8 198.8 29.3 Tobacco Non-Food 108.2 113.3 4.7 Clothing and Footwear 112.0 115.8 3.4 Housing, Water, Electricity, Gas 108.4 114.3 5.4 and Other Fuels Furnishing, Household Equipment and Routine 109.2 115.1 5.4 Maintenance Health 107.1 111.5 4.1 Transport 103.3 108.7 5.2 Communication 101.8 102.5 0.7 Recreation and Culture 108.6 113.3 4.3 Education 116.4 114.8 (1.4) Restaurant and Miscellaneous 109.9 116.8 6.3 Goods and Services Average Inflation Rate 5.1 3.9 (1.2) Average Purchasing Power of Peso 0.85 0.82 (0.03) Source: PSA MIMAROPA In terms of selected food items, fruits, vegetables, and mineral water, soft drinks, fruit and vegetable juices recorded the highest CPI of 167.8, 159.5, 146.7, respectively, in 2019. These food items registered higher inflation rates of 15.6 percent, 2.8 percent, and 9.2 percent, respectively, compared to 2018’s inflation rates. The region’s purchasing power of peso decreased to 0.82 in 2019 from 0.85 in 2018. C. Labor and Employment The region’s working age population increased by 2.63 percent from 2,093,000 in 2018 to 2,148,000 in 2019. Labor force participation 4 rate decreased by 1.7 percentage point from 62.0 percent in 2018 to 60.3 percent in 2019 (refer to Table 3). Table 3. Labor and Employment Statistics, MIMAROPA, 2018-2019 Percent Change/ Item 2018 2019 Difference (2019/2018) Population 15 years old & 2,093 2,148 2.63 above (in ‘000) LF Participation Rate (%) 62.0 60.3 (1.70) Employment Rate (%) 95.3 95.6 0.30 Unemployment Rate (%) 4.7 4.4 (0.30) Underemployment Rate (%) 20.6 19.6 (1.00) Source: PSA MIMAROPA Employment rate increased by 0.30 percentage point from 95.3 percent in 2018 to 95.6 percent in 2019.
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