TABLE OF CONTENTS

I. Macroeconomic Performance ...... 1 Inflation Rate ...... 1 Consumer Price Index ...... 1 Purchasing Power of Peso ...... 2 Labor and Employment ...... 3

II. Agriculture, Forestry and Fishery Sector Performance . . . 4 Crops ...... 4 Palay ...... 4 Local Prices of Palay and Regular Milled Rice . . . . 5 Rice Stock Inventory, Procurement and Distribution . . . 5 Corn ...... 6 Fruit Crops ...... 7 Vegetables ...... 7 Non-food Industrial and Commercial Crops . . . . 8 Livestock and Poultry ...... 9 Fishery ...... 9 Forestry ...... 10

III. Trade and Industry Services Sector Performance . . . . 11 Business Name Registration ...... 11 Export ...... 12 Import ...... 12 Manufacturing ...... 12 Mining ...... 13

IV. Services Sector Performance ...... 15 Tourism ...... 15 Air Transport ...... 15 Sea Transport ...... 16 Land Transport ...... 17

V. Peace and Security ...... 18

VI. Development Prospects ...... 20

MACROECONOMIC PERFORMANCEBOR

Inflation Rate Figure 1. Inflation Rate, Region

The region recorded a very low inflation in Q3 2019, which pegged at an average of 0.83 percent with the month of September posting as low as -0.3 percent (Figure 1). On a year- on-year basis, the region’s inflation exhibited a downward trend for the entire months in Q3 2019, which was inversely proportional to its performance in the same quarter in 2018. On the average, the region’s inflation waned by 4.3 percentage points in Q3 2019 from 5.1 percent Source: PSA in the same period in 2018 (Figure 2). Consequently, the region’s average inflation Figure 2. Inflation Rate by Province and Caraga Region for Q3 2019 was lower than the national average, which ranged from 2 percent to 4 percent.

Contributing to the declining trend of the region’s inflation was the drop in the annual rate of change of the overall price index of heavily weighted food and non-alcoholic beverages by 0.86 percent. Likewise, the year- on-year rate of change in the average index of transport services decreased by 0.81 percent. Source: PSA A slower annual increment was also noted in the mean indices of some commodity groups, of indicated the highest such as alcoholic beverages, tobacco and inflation among the provinces with 2.37 other vegetable-based tobacco products; percent, which was within the national inflation clothing and footwear; and housing, water, range for the period. electricity, gas and other fuels.

Meanwhile, some commodity groups, Consumer Price Index particularly under non-food items displayed year-on-year increases in the mean price The region’s average consumer price index indices, such as in furnishing, household (CPI) continued to move up, which year-on- equipment and routine; health; communication; year average cost for all items slightly went up recreation and culture, education and by about 1.0 index point, from 118.4 in Q3 2018 restaurants. On education services’ price to 119.4 Q3 2019 (Figure 3). Except for food index, an abrupt upturn was noted in its annual and non-alcoholic beverage products and rate of increment despite the implementation of transport, the price indices for the rest of the the Republic Act No. 10931 (Universal Access commodity groups grew during the period. The to Quality Tertiary Education Act) that provides highest CPI increment was noted in alcoholic free tuition. The inflation rate in education beverages, tobacco and other vegetable- accelerated at an average of 9.9 percent in Q3 based tobacco by 18.1 index points, from 155.2 2019 from -9.0 percent in Q3 2018 on account in Q3 2018 to 173.23 in Q3 2019. This was of higher price index in primary and secondary ascribed to the implementation of RA No. education services. 10963 (The Tax Reform for Acceleration and Inclusion Act) and RA No. 10351 (The Sin Tax At the provincial level, all provinces exhibited Law of 2012), which imposed higher tax rates low inflation rates in Q3 2019 relative to the for such commodity groups. Moreover, the same period in 2018. Among them, del average cost of education services was also up Sur displayed the lowest average inflation, which recorded at -0.30 percent. The Province

Page 1 of 21 by 9.8 index points, generating an average Figure 3. Consumer Price Index, Caraga Region price index of 109.07 in Q3 2019 from an average of 99.2 in Q3 2018. The surge in the average CPI of education services was attributed to high costs recorded in primary and secondary educations.

Meanwhile, the costs of food and non-alcoholic beverages and transport further eased by 1.1 index point and 0.9 index point in Q3 2019 compared to the average CPI in Q3 2018. The reduction in the year-on-year average price index of food items was attributed to the Source: PSA decline in the costs of bread, cereals products, sugar and confectionary products. On the other hand, the drop in the average CPI in transport Figure 4. Consumer Price Index by Province services was ascribed to a hefty reduction of 64.33 index points in the overall transportation cost of passenger sea transport and inland waterway, from 139.6 in Q3 2018 to 75.27 in Q3 2019.

With regards to provinces, del Sur posted the highest year-on-year mean CPI for all commodity items at 124.1 in Q3 2019, representing an increase of 1.5 index points relative to its CPI in Q3 2018. Contributing to Source: PSA this growth in the province’s CPI was the surge in the average price indices of some commodity groups, such as alcoholic Purchasing Power of Peso beverages, tobacco and other vegetable- tobacco products by 19.73 index points; The region’s purchasing power of peso (PPP) furnishings, household equipment and routine to a dollar steadily maintained at an average of households by 8.27 index points; recreation PhP0.84 centavos to a dollar, as its inflation and culture by 5.30 index points; and rate declined during the entire months of Q3 restaurants and miscellaneous by 6.90 index 2019. This implies that a consumer could only points. buy PhP 84.0 worth of goods for PhP 100.0 at

2012 constant prices. On a year on year basis, In terms of annual increase in the average CPI, the average PPP in Q3 2019 was slightly lower the Province of Dinagat Islands recorded the compared to the value of peso in the same highest among other provinces by 2.8 index period in 2018, which posted an average of points, from 117.0 in Q3 2018 to 119.8 in Q3 PhP 0.843 to US $1.0. 2019. The huge increase in the year-on-year mean CPI of both education services (14.03 Figure 5. Purchasing Power of Peso, Caraga Region index points) and tobacco and alcoholic beverages (18.43 index points) in Q3 2019 attributed to the rise in the mean CPI of the province. For education services, the cost of secondary education services in the province went up from 127.5 in September 2018 to 140.0 in the same month of 2019.

Agusan del Sur’s CPI decelerated by 0.4 index points in Q3 2019 to 118.0 from 118.4 in Q3 2018. This was mainly attributed to lower average cost in food and non-alcoholic beverages, especially on corn, rice, oils and Source: PSA fats.

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Labor and Employment

The region’s labor force accelerated by 2.53 percent to reach 1.943 Million in Q3 2019 from 1.895 Million in the same period last year (Table 1). Consequently, labor force participation rate slightly increased by 0.7 percentage point, from 62.7 percent in Q3 2018 to 63.4 percent in Q3 2019. However, employment rate fell by 0.8 percentage point, from 95.9 percent in Q3 2018 to 95.1 percent in Q3 2019. This resulted in the rise of unemployment rate to 4.9 percent during the period. Meanwhile, the region’s underemployment significantly reduced by 7.40 percentage points to end at 17.8 percent in Q3 2019.

Table 1. Labor and Employment, Caraga Region Indicator Q3 ‘18 Q3 ‘19 Percent (%) Change Labor Force (in 1.895 1.943 2.53 Million) Labor Force 62.7 63.4 0.70 Participation Rate Employment Rate 95.9 95.1 (0.80) Unemployment Rate 4.1 4.9 0.80 Underemployment 25.2 17.8 (7.40) Source: PSA

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AGRICULTURE, FORESTRY AND FISHERY SECTOR PERFORMANCEBOR AND EMPLOYMENT

Figure 6. Palay Production by Province Crops

Palay

The region’s aggregate palay production notably contracted by 21.45 percent, producing a lower aggregate output of 27,342.30 MT in Q3 2019 compared to 34,808.83 MT in Q3 2018 (Figure 6). Except for , the rest of the provinces experienced a decline in palay production with the highest drop noted in at 70.54 percent. Meanwhile, Surigao del Norte’s palay production grew by Source: PSA 7.98 percent during the period. However, the increase in its palay production failed to offset Figure 7. Palay Area Harvested by Province the reduction generated in palay production of other provinces, as its production output comprised only 30 percent of the region’s total produce.

The considerably high reduction in the region’s total planted areas to palay by roughly 27 percent contributed to the lower palay production output, which plunged from 11,662 hectares in Q3 2018 to 8,555 hectares in Q3 2019 (Figure 7). Among the provinces, only Surigao del Norte displayed an expanded palay area harvested by 7.05 percent. The rest of the provinces have experienced a significant drop in areas planted to palay with the largest slump Source: PSA recorded in Agusan del Dur of approximately 72 percent. Relatedly, the province of , which palay production areas comprised Figure 8. Palay Yield by Province roughly 53 percent of the region’s total area harvested in Q3 2018, fell by 32.29 percent in Q3 2019, that could be attributed to dry spell.

In terms of yield, the region’s average yield per hectare grew by 7.08 percent, from 2.98 MT/ha. in Q3 2018 to 3.20 MT/ha. in Q3 2019 (Figure 8). Except for , all provinces registered growth in palay yield per hectare with Surigao del Sur posting the highest increase of 10.22 percent. On the other hand, Agusan del Norte’s palay yield shrunk by 7.01 percent.

Source: PSA

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Local Prices of Palay and Milled Rice Province of Surigao del Norte recorded the highest drop in the price of the regular milled rice Liberalizing the importation, exportation and by 22.39 percent. Meanwhile, Surigao del Sur trading of rice in the country pursuant to the posted the lowest price among other provinces, implementation of Republic Act No. 11203 in which recorded at PhP36.32/kg. As noted, the August 2018 has brought divergent effects on cost of regular milled rice in Agusan del Norte the local rice industry in the region. The influx of was the highest among the provinces, which imported rice has adversely affected the pegged at PhP38.47/kg, notwithstanding the low region’s farmgate price of locally-produced farmgate price of palay it recorded during the palay, which further slipped at an average of period (Figure 10). 28.02 percent, from PhP 21.37/kg. of palay in Q3 2018 to PhP 15.38/kg in Q3 2019 (Figure 9). Among the provinces, Agusan del Norte posted Rice Stock Inventory, Procurement and the highest slump at 33.19 percent to end at PhP Distribution 13.39/kg., the lowest farmgate price of palay in the region. Meanwhile, Surigao del Sur The region’s rice stock inventory surged by displayed the highest farmgate price of palay, 32.91 percent in Q3 2019 compared to the same which registered at PhP 15.76/kg. during the period in 2018, which totalled to 417,865 bags period. (Figure 11). The high rice stock inventory was attributed to arrival of a large volume of imported The huge inflow of imported rice in the region, to rice from Thailand and Vietnam, which were a certain extent, has stabilized the prices of distributed through the local rice distributors regular milled rice in the local markets. The price within and outside the region. The rice stock of the region’s regular milled rice reduced at an inventory of Surigao del Norte comprised about average of 14.42 percent, from PhP 43.72/kg in 30 percent of the aggregate rice stocks of the Q3 2018 to PhP 37.41/kg in Q3 2019. The region, as the province served as the unloading and storage station of imported rice through the Figure 9. Palay Farmgate Price by Province Port of Surigao. However, the province’s total rice stock inventory in Q3 2019 of 128,846 bags is lower by 34.14 percent relative to its rice stock inventory in Q3 2018.

To ease the negative impact brought by the huge inflow of imported rice to the local farmers, the national government engaged in the massive procurement of locally produced rice in the region. As of Q3 2019, a total of 13,438 bags were procured from the local farmers from nil in Q3 2018 (Figure 12). The enforcement of additional PhP 3.00/kg buffer stocking incentive from January to September 2019, continuous Source: PSA implementation of drying, delivery and the cooperative development incentive fee (CDIF), Figure 10. Regular Milled Rice Price by Province and higher buying price offered by the National Food Authority (NFA) compared to the rice traders’ price have stimulated the local farmers to sell their produce to the government. Figure 11. Rice Stock Inventory by Province

Source: PSA Source: NFA Caraga

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Figure 12. Palay Procurement by Province Figure 13. Rice Distribution by Province

Source: NFA Caraga Source: NFA Caraga

On the other hand, the distribution of the region’s Figure 14. Corn Production by Province locally-produced rice in the local market contracted by 47.13 percent, from 91,748 bags in Q3 2018 to 48,506 bags in Q3 2019 (Figure 13). This was ascribed to the influx of good quality imported rice being sold in the local markets through the private rice traders.

Corn

Corn production in the region slipped by 2.42 percent, from 29,240.90 MT in Q3 2018 to 28,531.96 MT in Q3 2019 (Figure 14). This was Source: PSA ascribed to the reduction in area harvested for Figure 15. Corn Area Harvested Production by Province corn commodity in the provinces of Agusan del Norte, Surigao del Sur and Dinagat Islands.

In particular, corn production performance in some provinces have slipped on a year-on year basis with Agusan del Norte by 25.65 percent, the Province of Dinagat Islands by 47.50 percent and Surigao del Sur by 15.09 percent in Q3 2019 relative the provinces’ production outputs in Q3 2018. The combined volume of production of said provinces contributed approximately 37 percent of the region’s total corn production output during the period. Meanwhile, corn Source: PSA production in Agusand del Sur and Surigao del Norte increased by 10.56 percent and 98.20 Figure 16. Corn Yield by Province percent, respectively. Agusan del Sur topped among other provinces, which corn production comprised about 60 percent of the region’s total produce.

The region’s total area harvested for corn slightly increased by 0.26 percent in Q3 2019 from 8,362 hectares in Q3 2018, despite the substantial drop in planted areas to corn in Agusan del Norte by 4.26 percent, Surigao del Sur by 5.23 percent and the Province of Dinagat Islands by 43.40 percent (Figure 15). This was Source: PSA

Page 6 of 21 due to the increase in area planted to corn in Figure 17. Fruit Crops Production, Caraga Region Agusan del Sur and the Province of Dinagat Islands, which recorded at 3.99 percent and 34.30 percent, respectively.

Moreover, the region’s average corn yield fell by 2.68 percent in Q3 2019 to register at 3.40 MT/ha. from 3.50 MT/ha. in Q3 2018 (Figure 16). The provinces with low corn production outputs in Q3 2018 posted a reduction in corn yields, such as Agusan del Norte, the Province of Dinagat Islands, and Surigao del Sur. Meanwhile, Agusan del Sur has better Source: PSA Caraga performance than the other provinces in terms of corn yield, which expanded from 3.89 MT/ha in Figure 18. Major Fruit Crops Production, By Province Q3 2018 4.13 MT/ha in Q3 2019. Surigao del Norte has exhibited a significant increase in corn yield from 1.45 MT/ha. in Q3 2018 to 2.14 MT/ha in Q3 2019.

Fruit Crops

The region’s overall fruit crops production slightly improved in Q3 2019, which grew by 0.67 percent from 96,937.62 MT in Q3 2018 (Figure 17). Both the major and priority fruit Source: PSA Caraga crops generated increase in production outputs by 0.74 percent and 0.91 percent in Q3 2019 relative to volume of production in Q3 2018. On the other hand, production of other fruit crops Vegetables dropped by 2.31 percent in Q3 2019. The region’s total vegetables production Major fruit crops accounted 96 percent of the declined by a margin of 0.26 percent in Q3 2019, region’s total fruit production in Q3 2019, which generating a lower production volume of comprised of banana, calamansi, mango and 29,519.73 MT from 29,596.46 MT in Q2 2018 pineapple. The top producing provinces of major (Figure 19). The drop in the vegetable fruit crops are Surigao del Sur, Agusan del Sur production outputs of priority and other and Agusan del Norte, which production vegetable crops by 3.94 percent and 2.51 volumes encompassed 41.8 percent, 28.5 percent attributed to the slight decrease in the percent and 27.7 percent, respectively, to the region’s aggregate vegetables production in Q3 region’s aggregate production during the period 2019. Nonetheless, major vegetable crops (Figure 18). Among the major fruit crops, the exhibited an increase of 1.22 percent. banana commodity accounted about 90 percent of the region’s total production volume during the Figure 19. Vegetables Production, Caraga Region quarter. The banana producing provinces in the region are Surigao del Sur, Agusan del Sur and Agusan del Norte, which production outputs accounted 45.73 percent, 30.34 percent and 21.90 percent, respectively.

The priority and other fruits accounted roughly 4 percent of the region’s aggregate fruit crops production.

Source: PSA Caraga

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priority NFICCs, which fell by 0.34 percent and Figure 20. Major Vegetables Production, By Province Figure 21. NFICC Production, Caraga Region

Source: PSA Caraga Source: PSA Caraga

The major vegetable crops accounted Figure 22. Major NFICC Production, By Province approximately 70 percent of the region’s total vegetables output in Q3 2013, which is comprised of mongo, peanut, cabbage, eggplant, tomato, camote (sweet potato), and cassava. Apparently, camote (sweet potato) production encompassed about 59 percent of the major vegetable crops output during the period. Except for cabbage and cassava crops, the rest of the vegetable crops under this category exhibited growths in production volume, which the combined share comprised roughly 74 percent of the region’s aggregate produce. Meanwhile, the production outputs of Source: PSA Caraga cabbage and cassava tapered by 16.67 percent and 11.87 percent, respectively. These two (2) 13.13 percent, respectively. vegetable crops accounted about 26 percent of the total production of major crops. The major NFICCs accounted approximately 84 percent of the region’s aggregate industrial Among the provinces, Agusan del Sur crops production, which encompassed abaca, contributed about 70 percent of the region’s coconut, coffee, rubber, sugar cane and tobacco major vegetable crops production. The (Figure 22). Among these commodities, the provinces of Surigao del Sur and Agusan del coconut and abaca displayed a slight decline in Norte contributed 33 percent and 29 percent, production outputs. It should be noted that respectively. Meanwhile, the Provinces of coconut production accounted 96 percent of the Surigao del Norte and Dinagat Islands aggregate major industrial crops production and accounted 5 percent and 1 percent, respectively roughly 81 percent of the total NFICC production (Figure 20). of the region. Meanwhile, the production performance of rubber, coffee, sugarcane and The priority and other vegetable crops attributed tobacco remarkably grew at 14.19 percent, 9.07 22.23 percent and 7.60 percent of the region’s percent, 235.90 percent and 6.67 percent, total vegetable production. respectively. The Provinces of Surigao del Sur, Agusan del Norte and Surigao del Norte were the top producers of major NFICCs, where their Non-Food Industrial and Commercial Crops contributions accounted 53.15 percent, 20.87 percent and 15.75 percent, respectively, to the The region’s non-food industrial and commercial region’s aggregate produce. crops (NFICCs) exhibited a descent in total production outputs by 2.57 percent from Moreover, the priority NFICC accounted 15.64 248,846.32 MT in Q3 2018 to 242,440.01 MT in percent in Q3 2019. The substantial reduction Q3 2019 (Figure 21). This was attributed to the in the production performance of this industrial decline in the volume of production of major and crops category was ascribed to the drop in the

Page 8 of 21 quantity output of oil palm commodity, which 24). Except for chicken eggs, the rest of poultry accounted about 15 percent of the total NFICCs products suffered low production outputs. The output. The Province of Agusan del Sur has quantity output of chicken, which accounted been the top producer of oil palm, which about 60 percent of the poultry production, production output comprised about 97 percent of dropped by 13.30 percent. Ducks and duck eggs the region’s oil palm produced. production outputs, which encompassed roughly 3 percent of the total poultry production in the Meanwhile, production of other NFICCs went up region, shrunk by 5.71 percent and 1.64 percent, by 2.99 percent. However, this commodity group respectively. Meanwhile, chicken eggs contributed only 0.21 percent to the region’s total production expanded by 14.30 percent with output. production output accounted about 38 percent of the aggregate poultry production in the region.

Livestock and Poultry Fishery The livestock production in the region generally improved in Q3 2019 relative to its performance The region’s aggregate fishery output slipped by in Q3 2018, despite the low production in 12.85 percent in Q3 2019, which totalled to carabao and goat meats. The livestock volume 15,641.95 MT from 17,948.72 MT in Q3 2018 of production grew by 4.64 percent in Q3 2019, (Figure 25). Low fishery outputs were observed which generated a total output of 11,785 MT in all fishery categories with the commercial compared to 11,262 MT of the same period in fisheries recorded the highest decline of 15.98 2018 (Figure 23). The expansion in hogs and percent. Municipal fisheries, which accounted cattle production, which has combined 70.16 of the region’s total fishery production contribution of roughly 93 percent, compensated during the quarter, tapered by 12.31 percent. the decline generated in carabao and goat The aquaculture sector was also not spared, as meats production in the region. its production output slipped by 13.21 percent.

On the other hand, the poultry volume of The region’s top producing fishery/marine production plunged by 4.32 percent in Q3 2019, products in Q3 2019 were seaweeds, Frigate from 6,182 MT in Q3 2018 to 5,915 MT (Figure Tuna (Tulingan), Bali Sardinella (Tamban),

Figure 23. Livestock Production, Caraga Region Figure 25. Fishery Production, Caraga Region

Source: PSA Source: PSA

Figure 24. Poultry Production, Caraga Region Figure 26. Fishery Value, Caraga Region

Source: PSA Source: PSA Page 9 of 21

Yellowfin Tuna (Tambakol/Bariles), and 34.18 percent. Surigao del Norte also chipped in Skipjack (Gulyasan). Except for Yellowfin Tuna, with an increase of its log production by 5.18 production volume of the majority marine percent. However, log production in Agusan del products of the region exhibited lower production Sur, which production output accounted 52.68 performance in Q3 2019 compared to the same percent of the region’s total log production, period in 2018. Meanwhile, the production of decelerated by 2.42 percent during the period. Yellowfin Tuna displayed an increase of barely 1 percent. Figure 27. Fishery Production, By Province

Moreover, the value of the region’s produced fishery products grew by 1.08 percent in Q3 2019, to reach PhP 1.52 Billion from PhP 1.51 Billion in Q2 2018 (Figure 26). Despite a huge decline in the production output of municipal fisheries during the quarter, the total value of its fishery\marine products recorded increased by 3.09 percent. Consequently, the municipal fisheries accounted 78.17 percent of the region’s aggregate production value of fishery products. Moreover, production value in aquaculture Source: PSA generated a growth of 8.92 percent during the quarter. Meanwhile, the value of commercial Figure 28. Log Production, Caraga Region fishery products experienced a significant decline by 12.91 percent during the period.

Except for the Province of Dinagat islands, which achieved an increase of 3.55 percent in fishery production, the rest of the provinces in the region recorded a reduction in fishery outputs in Q3 2019 (Figure 27). The Province of Surigao del Sur is the top producing province on fishery products, where its share accounted 46.83 percent of the region’s aggregate fishery output. However, it suffered a substantial decline Source: DENR FMB in fishery production by 15.32 percent. Meanwhile, Surigao del Norte generated the highest slump in fishery production at 16.04 percent. Agusan del Sur, a landlocked province, recorded a lower production output in aquaculture by 14.45 percent. Fishery production in Agusan del Norte also tapered by 3.74 percent.

Forestry

The region’s log production in Q3 2019 substantially went up by 21.21 percent, generating a total volume of 175,329 cu.m. from 144,654 cu.m. in Q2 2018 (Figure 28). Improved log production performance in the provinces of Agusan del Norte and Surigao del Sur attributed largely to the increase in the region’s aggregate log production. In particular, Agusan del Norte’s log production remarkably grew by 187.03 percent, from 11,444 cu.m. in Q3 2018 to 32,848 cu.m. in Q4 2019. This was followed by Surigao del Sur, where its log production increased by

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TRADE AND INDUSTRY SERVICES SECTOR PERFORMANCE

Business Name Registration PhP 450.91 Million in Q3 2019 (Table 4). Except for the Surigao del Norte, the rest of the The overall performance of business name provinces in the region generated remarkable registration (BNR) in the region improved by surge in domestic sales with the highest 13.26 percent, from 2,194 registrants in Q3 2018 recorded in Surigao del Sur by 1,1113.98 to 2,485 registrants in Q3 2019 (Table 2). The percent. The Province of Dinagat Islands Province of Dinagat Islands recorded the highest ranked second, where its domestic sales grew increase in the number of business registrants by 950 percent. Incidentally, domestic sales of by 111.11 percent. Meanwhile, Surigao del Surigao del Norte dropped by 67.64 percent Norte’s recorded business registrants slipped by during the period. 2.60 percent during the period. The province of Agusan del Norte achieved the highest number Table 4. Domestic Sales, Caraga Region of business registrants, which comprised 40.64 Province Q3 ’18 Q3 ’19 Percent (%) (PhP (PhP Change percent of the region’s total in Q3 2019. Million) Million)

Table 2. New Business Name Registered, Caraga Region ADN 101.00 125.40 24.16 Province Q3 ‘18 Q3 ‘19 Percent (%) ADS 98.51 176.51 79.18 Change SDN 7.88 2.55 (67.64) ADN 996 1,010 1.41 SDS 10.68 129.65 1,113.98 ADS 374 565 51.07 PDI 1.60 16.80 950.00 SDN 462 450 (2.60) Caraga 219.67 450.91 105.27 SDS 308 346 12.34 Source: DTI Caraga PDI 54 114 111.11 Caraga 2,194 2,485 13.26 Furthermore, investments from BNR Source: DTI Caraga significantly grew by 1,328.40 percent in Q3 Moreover, generated jobs from registered 2019 to reach PhP 785.48 Million from business enterprises significantly rose by PhP 54.99 Million in Q3 2018 (Table 5). 137.78 percent in Q3 2019, from 2,378 jobs in Investments generated in Surigao del Sur Q3 2018 to 5,583 jobs (Table 3). All the notably jumped by 4,062.25 percent, the highest provinces in the region posted growths in job increase among provinces in the region during generation with the highest increase recorded in the period. On the other hand, Agusan del Sur Surigao del Norte and Surigao del Sur by 596.50 contributed about 56 percent of the aggregate percent and 336.74 percent, respectively. The recorded investment in the region. Province of Surigao del Sur surpassed other provinces in job generation, which contributed Table 5. Investment, Caraga Region roughly 41 percent of the total jobs generated in Q3 ’18 Q3 ’19 Percent (%) Province (PhP (PhP Change the region during the period. Million) Million)

Table 3. Jobs Generated, Caraga Region ADN 14.20 16.30 14.79 Province Q3 ‘18 Q3 ‘19 Percent (%) ADS 30.43 438.10 1,339.70 Change SDN 4.75 127.12 2,576.21 ADN 1,115 1,365 22.42 SDS 4.41 183.56 4,062.25 ADS 529 833 57.47 PDI 1.20 20.4 1,600.00 SDN 143 996 596.50 Caraga 54.99 785.48 1,328.40 SDS 528 2,306 336.74 Source: DTI Caraga PDI 63 83 31.75 Caraga 2,378 5,583 137.78 Source: DTI Caraga Export

Domestic sales from the region’s registered The region’s export products comprised business enterprises improved by 105.27 primarily of agricultural and mineral percent, from PhP219.67 Million in Q3 2018 to Page 11 of 21 commodities. Consequently, the aggregate Figure 29. Volume of Export, Caraga Region volume of the region’s exported products significantly improved by 32.87 percent in Q3 2019, where the quantity output totalled to 13.34 Billion kilograms from 10.04 Billion kilograms in Q3 2018 (Figure 29). The surge in the quantity of exported products was mainly attributed to the increase in the mineral product shipments to China, Hong Kong and Japan. The mineral products comprised approximately 98 percent of the region’s total export. The remaining 2 percent was attributed to the exported agricultural commodities, which include banana Source: PSA Caraga chips, and coconut and its by-products, such as coconut water, oil and desiccated flesh. Figure 30. Value of Export, Caraga Region

The corresponding exported value also rose by a hefty 30.72 percent, which totalled to US$ 395.2 Million in Q3 2019 from US$ 302.33 Million Q3 2018. This was attributed to increased shipments of high value mineral products to Japan and Hong Kong (Figure 30).

Surprisingly, export data also showed a spectrum of heavy equipment such as mechanical shovels, graders, rollers, trucks, and four-wheel vehicles, as well as various materials Source: PSA Caraga such as filing cabinets, were shipped to Papua New Guinea from the Port of Masao within the Figure 31. Volume of Import, Caraga Region month of September 2019.

Import

The partial data of the region’s import showed a drop in quantity at 78.82 percent from 3.30 Million kilograms in Q3 2018 to 700,000 kilograms in Q3 2019 (Figure 31). The Port of Surigao recorded a huge quantity of imported products from South Korea, Indonesia, Taiwan and British Islands in September 2019. In September data only particular, a total of 1.5 Million kilograms of Source: PSA Caraga methanol (methyl alcohol) were downloaded at the Port of Surigao in September 2019. Figure 32. Value of Import, Caraga Region The regional trade with South Korea and Indonesia yielded an aggregate import value of US$ 1.32 Million, while the value of imported products from Taiwan and the British Islands was estimated to reach US$407,000 (Figure 32).

Manufacturing

The manufactured products of the region comprised mainly of wood-based products, September data only where the total output decreased by 0.74 Source: PSA Caraga percent in Q3 2019. A lower aggregate

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Figure 33. Manufactured Wood-based Products, Caraga Region Figure 34. Manufactured Wood-based Production by Province

Source: DENR FMB Source: DENR FMB

production output was recorded on production in nickel ores notwithstanding the manufactured wood-based products in Q3 2019, increased production in its semi-processed which totalled to 120,751 cu.m. from 121,655 products, such as nickel mixed sulfides and cu.m in Q3 2018 (Figure 33). This was ascribed scandium oxalate. The scandium oxalate is a to the decline in the quantity outputs for lumber rare earth metal produced by Taganito HPAL and plywood products by 4.54 percent and 15.99 Nickel Corporation as a by-product of high percent, respectively. Meanwhile, veneer pressure acid leaching process. production posted a growth of 14.23 percent, which accounted roughly 50 percent of the On the other hand, sales volume eased out by region’s total output of manufactured wood- 0.95 percent on account of better sales on silver, based products. nickel ore and scandium oxalate mineral products in Q3 2019, compared to the same Among the provinces, only Agusan del Sur period in 2018. However, gold and nickel mixed displayed a substantial surge in the production sulfides posted substantial slip in terms of sales volume of manufactured wood-based products, volume by 29.58 percent and 29.10 percent, which recorded at 51.88 percent in Q3 2019 respectively. relative to its performance in Q3 2018. The provinces of Agusan del Norte and Surigao del The actual gross sales of mineral products Sur suffered a notable decline in production by shrunk by 33.26 percent, from PhP 19.35 Billion 4.22 percent and 4.47 percent, respectively. The in Q3 2018 to PhP 12.92 Billion in Q3 2019. Province of Agusan del Norte is the top Gold, nickel ore, and nickel sulfides registered producers of manufactured wood-based lower actual gross sales during the quarter, products, contributing roughly 88 percent of the which dropped by 10.61 percent, 29.36 percent region’s total production. and 53.05 percent, respectively.

Consequently, the partial excise tax generated Mining in Q3 2019 substantially reduced by 30.70 percent, from PhP 696.53 Million in Q3 2018 to The preliminary data on the mining sector’s PhP 482.61 Million in Q3 2019. Meanwhile, performance showed a slight contraction in royalty tax generated increased by 28.13 some mineral indicators in Q3 2019 compared to percent in Q3 2019, which totalled to PhP Q3 2018 (Table 6). 526.86 Million from PhP 378.66 Million in Q3 2018. Accordingly, force majeure affected the overall mineral shipments of the region in Q3 2019, Employment in the industry registered a decline generating an average of 4.25 percent from 239 of 6.82 percent in Q3 2019 compared to its shipments in Q3 2018. Nickel ore remains to be performance in Q3 2018. This was mainly the dominant mineral export of the region as attributed to lower job generated by nickel ore shipments of said product accounted about 96 producing companies, which accounted the percent of its total mineral shipments in Q3 largest chunk of the region’s total employment in 2019. the mining sector at 64.44 percent.

Production volume slightly dropped by 0.55 percent, which was attributed to slower

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Table 6. Mining Statistics, Caraga Region Percent Indicator Q3 ‘18 Q3 ‘19 (%) Change Shipments

Gold 6 4 (33.33)

Silver 6 4 (33.33) Nickel Ore 239 237 (0.84) Nickel/Cobalt Mixed 4 2 (50.00) Sulfides Scandium Oxalate 4 1 (75.00) Total 259 248 (4.25) Production Volume Gold (in ‘000 Wet 145.20 164.87 13.55 Metric Ton/WMT) Silver (WMT) 145.20 164.87 13.55 Nickel Ore (in ‘000 Dry 9,921.67 9,823.80 (0.99) Metric Ton/DMT) Nickel/Cobalt Mixed 9.24 11.82 27.91 Sulfides (DMT) Scandium Oxalate 2.29 2.89 26.20 (DMT)) Total 10,221.31 10,165.36 (0.55) Sales Volume Gold (WMT) 777.27 547.37 (29.58) Silver (WMT) 94.31 124.86 32.40 Nickel Ore (DMT) 9,260.29 9,559.22 3.23 Nickel/Cobalt Mixed 10.77 7.63 (29.10) Sulfides (DMT) Scandium Oxalate 1.42 1.47 3.52 (DMT)) Total 10,142.64 10,239.09 0.95

Actual Gross Sales (PhP Million)

Gold 1,480.42 1,323.38 (10.61)

Silver 2.39 3.45 44.65

Nickel Ore 13,400.62 9,466.57 (29.36) Nickel/Cobalt Mixed 4,439.91 2,084.53 (53.05) Sulfides Scandium Oxalate 32.64 40.21 23.19 Total 19,355.98 12,918.14 (33.26) Estimated Excise Tax (PhP Million) Gold 59.22 52.94 (10.61) Silver 0.09 0.14 44.65 Nickel Ore 637.22 429.61 (32.58) Nickel/Cobalt Mixed - - - Sulfides Scandium Oxalate - - - Total 696.53 482.68 (30.70) Estimated Royalty Tax (PhP Million) Gold - - - Silver - - - Nickel Ore 526.86 378.66 28.13 Nickel/Cobalt Mixed - - - Sulfides Scandium Oxalate - - - Total 526.86 378.66 28.13 Employment Total 29,224 27,231 (6.82)

Preliminary data

Source: MGB Caraga

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SERVICES SECTOR PERFORMANCE

Tourism Figure 35. Tourist Arrivals, Caraga Region

More tourists visited the region in Q3 2019 as evident in the surge of tourist arrivals by 92.79 percent or 150,489 relative to the recorded visits of 78,057 in Q3 2018 (Figure 35). Substantial growths were noted in the region’s tourist arrival across groups with the highest increase recorded among the overseas or balikbayans, which rose by 1,227.71 percent during the period. The influx of domestic tourists in the region also increased significantly by 99.77 percent, while the foreign tourist visits grew by Surigao del Norte, Province of Dinagat Islands and roughly 55 percent during the period. Majority of City data only the tourists, comprising roughly 84.85 percent, Source: DOT Caraga were domestic tourists. Figure 36. Accredited Tourism-Related Establishments, The Province of Surigao del Norte, particularly Caraga Region the and Islands, is consistently the most visited tourist destination in the region, engendering roughly 45 percent of the total tourist arrivals in Q3 2019. Two (2) other tourist destination areas have surprisingly exhibited remarkable surge in tourist visitations during the quarter, such as the Province of Dinagat Islands and Cabadabaran City, generating growths of approximately 40 percent and 15 percent, respectively.

Moreover, the number of accredited tourism- related enterprises (TREs) rose by 15.91 Source: DOT Caraga percent in Q3 2019 relative to the same period in 2018 (Figure 36). This notable increase in the number of accredited TREs was a result of Figure 37. Number of Flights, Caraga Region continued advocacy efforts of DOT Caraga on mandatory accreditation in primary TREs, such in the case of the accreditation of community guides in Las Nieves, Agusan del Norte.

Air Transportation Page 15 of 21

Air traffic in the region contracted by 7.18 percent in Q3 2019, from 3,842 flights in Q3 2018 to 3,566 flights in Q3 2019 (Figure 37). Source: CAAP , Surigao and Siargao Both the Butuan and Surigao Airports, which are the main transit points in the region, have certain daily flight schedules and preventive experienced significant reduction in the number maintenance of aircrafts en route for Surigao of flights during the quarter by 15.12 percent and Airport. Moreover, the Philippine Airlines has yet 28.97 percent, respectively. Contributing to this to resume its operation in due to performance were the cancellation of a number the on-going rehabilitation of the runway. of Butuan trips due to low passenger uptake on

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Figure 38. Number of Passengers, Caraga Region Figure 39. Volume of Cargo, Caraga Region

Source: CAAP Butuan, Surigao and Siargao Source: CAAP Butuan, Surigao and Siargao

Meanwhile, the Siargao Airport generated a 3.72 Figure 40. Number of Ship calls, Caraga Region percent increase in the number flights in Q3 2019, which totalled to 1,842 flights from 1,776 flights in the same period of 2018. Additional trips were established for Siargao Airport during the period due to scheduled international and national surfing competitions organized by the Provincial Government of Surigao del Norte that was held in the Municipality of General Luna, Siargao Islands. Both the number of air passenger and volume of cargoes bound to Siargao Islands jumped by 14.55 percent and 11.78 percent during the period. Source: PPA Agusan

Consequently, the region’s number of air passengers and the volume of cargoes in Q3 Figure 41. Number of Passengers, Caraga Region 2019 declined by 2.30 percent (Figure 38) and 22.50 percent (Figure 39), respectively.

Sea Transportation

The preliminary data on sea transportation showed an expansion in sea traffic, as volume of sea passengers, ship calls and cargo improved in Q3 2019 compared to the same period in 2018. Source: PPA Agusan Ship calls slightly grew by 0.05 percent, from 3,871 in Q3 2018 to 8,873 ship calls in Q3 2019 Figure 42. Volume of Cargo (MT), Caraga Region (Figure 40). The minor surge was ascribed to the increase in foreign ship calls caused by the resumption of nickel ore mining operations of Agata Mining Ventures, Inc. (AMVI) in , Agusan del Norte. The improvement in foreign ship calls offset the slight drop in domestic ship calls by 0.08 percent in Q3 2019, compared to the same period in 2018, which was attributed to the suspension of ship calls of some RO-RO vessels from to and vice versa.

Passenger traffic grew by 4.30 percent to reach Source: PPA Agusan 190,889 passengers in Q3 2019 from 183,027

Page 16 of 21 passengers in Q3 2018 (Figure 41), which was attributed to the increased preference on ships by students bound for Manila, and .

Moreover, cargo throughput expanded by 35.20 percent in Q3 2019 relative to its performance in Q3 2018. This was contributed largely by the increase in export volume, which substantially surged by 60.60 percent. The increase in foreign shipment was attributed to additional nickel ore shipments of AMVI. Apart from this, transport of domestic products also increased by 10.36 percent during the period (Figure 42). The improved local cargoes’ shipments were ascribed to the increased volume in the transport of general cargoes, petroleum products, sand and gravel for road and bridge construction, wood products such as lumber, and vegetables and fruits bound for Cebu and .

Land Transportation

The region’s vehicle registration improved in Q3 2019 as evident in the surge in the number of registered vehicle units by 21.6 percent, which totalled to 68,341 from 56,189 in Q3 2018 (Figure 43). About 68 percent of these registered vehicles units were renewal of registrations, which grew by 32.45 percent during the period. Newly registered vehicle units comprised 32 percent, which volume also expanded by 3.71 percent. Among the provinces, Agusan del Norte accounted approximately 67 percent of the registered vehicle units. The provinces of Agusan del Sur, Surigao del Norte and Surigao del Sur contributed 8.5 percent, 11.7 percent and 12.6 percent, respectively.

Figure 43. Motor Vehicle Registration, Caraga Region

Source: DOTr Caraga

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PEACE AND SECURITY

Criminality Continuous trainings, exercises and seminars The region’s average monthly crime rate such as basic skills and techniques in criminal (AMCR)1 reduced by 2.36 percentage points in investigation exhibited positive impacts in Q3 2019, which recorded at 28.37 percent providing prompt solutions to reported crime and compared to 30.73 percent in the same period in in the filing of cases in court. The proper and 2018. On the average, there were 28 crimes effective implementation of Police Integrated recorded per month for every 100,000 Patrol System (PIPS), through foot and mobile population in the region from July to September patrols, has strengthened crime prevention, as of 2019. well as resulted in improved CCE and CSE in the region. Relatedly, the region’s total crime volume shrunk by 6.10 percent in Q3 2019 relative to the 2,477 Table 7. Crime Statistics, Caraga Region recorded crime incidents in Q3 2018 (Table 7). Indicator Q3 ‘18 Q3‘19 Percent (%) The decline in the reported incidents of both Change index and non-index crimes2 by 17.72 percent Index Crime and 3.10 percent contributed to the overall drop Butuan City 92 73 (20.65) in the region’s total crime volume. Agusan del ADN 65 63 (3.08) Sur registered the highest decline in reported ADS 96 101 5.21 crime incidents by 21.27 percent in Q3 2019. PDI 21 17 (19.05) The reduction in reported crime volume was also SDN 135 80 (40.74) noted in Agusan del Norte by 12.80 percent, SDS 99 84 (15.15) Butuan City by 1.13 percent and Surigao del Sur Caraga 508 418 (17.72) by 8.40 percent. Meanwhile, both the provinces Non-Index Crime of Dinagat Islands and Surigao del Norte Butuan City 408 363 (11.03) exhibited a surge in crime volume by 39.62 ADN 289 287 (0.69) percent and 14.32 percent, respectively. ADS 501 369 (26.35) PDI 32 57 78.13 The intensified law enforcement and anti- SDN 326 447 37.12 criminality operations such as “Oplan Sita,” SDS 413 385 (6.78) campaign against loose fi rearms, and continued Caraga 1969 1908 (3.10) conduct of illegal-drug operations among the Crime Volume different units/offices of the PNP contributed to Butuan City 500 436 (12.80) the reduction in the overall crime volume in the ADN 354 350 (1.13) region. In addition, the strengthened PNP ADS 597 470 (21.27) PDI 53 74 39.62 collaboration with the concerned community SDN 461 527 14.32 stakeholders has been considered as an SDS 512 469 (8.40) essential element in the region’s endeavor to Caraga 2,477 2,326 (6.10) eliminate local insurgency and reduce crime Crime Clearance Efficiency (%) volume. Butuan City 90 95 5 ADN 91 95 4 The region achieved remarkable improvement in ADS 90 93 3 crime clearance efficiency (CCE)3 and crime PDI 91 99 8 solution efficiency (CSE)4, which posted at 95 SDN 88 94 6 percent and 91 percent in Q3 2019, respectively, SDS 87 93 6 relative to its performance in the same period in Caraga 90 95 5 2018. The Province of Dinagat Islands topped Crime Solution Efficiency (%) among other provinces in both CCE and CSE Butuan City 79 86 7 performance, which achieved 99 percent in both ADN 85 91 6 indicators. ADS 83 89 6 PDI 87 99 12

1 AMCR is calculated as number of crimes over total population over number 3 PNP defined CCE as the percentage of cleared cases out of the total of months multiplied by 100,000 population. number of crime incidents handled by law enforcement agencies for a 2 PNP defined index crimes as crimes which are sufficiently significant and given period of time. which occur with sufficient regularity to be meaningful, such as murder, 4 PNP defined CSC as the percentage of solved cases out of the total physical injury, robbery, theft and rape. number of crime incidents handled by law enforcement agencies for given period of time.

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Indicator Q3 ‘18 Q3‘19 Percent (%) Change SDN 83 90 7 SDS 80 88 8 Caraga 83 91 8 Source: PNP Caraga

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DEVELOPMENT PROSPECTS

Agriculture Development storage facilities in the , Surigao del Sur.  Construction of 9.8 kms. Farm-to-Market (Source: 11 December 2019, Road (FMR) Project in the barangays of https://www.pna.gov.ph/articles/1088509) Tungao and San Mateo, Butuan City with a total project cost amounting to PhP 159 Trade and Industry Million, which is funded under the Department of Agriculture - Philippine Rural  The Intellectual Property Office of the Development Project (DA-PRDP). The (IPOPHL) established a satellite project is expected to benefit thousands of office at the Department of Trade and farmers in both barangays, which has an Industry (DTI) Caraga to provide assistance aggregate potential area for agricultural to the public, particularly the micro, small, development expansion of 9,930 hectares. and medium enterprises (MSMEs) in the (Source: Alexander Lopez, PNA CARAGA, 14 region in securing intellectual property rights October 2019) (IPR), as well as to promote the agency’s services across the country.  Concreting of 11.92 kms. San Vicente- (Source: 21 November 2019, Mahapag FMR Project in -San http://caraganewscourier.com/ipophl-puts-up- satellite-office-in-butuan-city/) Luis, Agusan del Sur with funding assistance

from DA-PRDP amounting to PhP 197.91

Million. Infrastructure Expansion (Source: RPCO Caraga/ Joy M. Montecalvo, PRDP, http://prdp.da.gov.ph/11-92km-fmr-to-start- in-agusan-del-sur/, 24 September 2019)  Construction of access roads connecting several areas within with  The DA-Caraga, through the Rice approved project cost by the Department of Competitiveness Enhancement Fund Budget and Management (DBM) amounting (RCEF), turned over a total of 110 units of to PhP50.8 Million. (Source: Media Information mechanical rice trans-planters to 110 eligible & Communication Surigao Facebook Page, 26 farmer associations and cooperatives in the November 2019) region with a total project cost amounting to PhP 30.4 Million on 12 July 2019 at the DA- Integrated Laboratories Compound, Brgy. Commercial/Business Expansion Taguibo, Butuan City. (Source: Rhea Abao, DA Caraga/PIA Caraga, 17  Commercial business expansion by July 2019, Philippine Primark Properties, Inc in Surigao https://pia.gov.ph/news/articles/1024579) City, which will be located at a property of LGU-Surigao City through lease or PPP  The PhilFIDA distributed four (4) portable financing arrangement. spindle-stripping machines and two hand (Source: DXKS RPN RADIO Surigao Facebook tractors to 160 farmers in Cecilia Page, 4 December 2019) of San Luis and Barangay Muritula in Esperansa, both within the Province Agusan  Tony and Lulu, a comfort food fusion del Sur, with a total cost amounting to PHP restaurant located at J.C. Aquino Avenue, 1.0 Million. Butuan City next to BPI and in front of (Source: PNA CARAGA, 12 Otober 2019, Robinson’s Place Butuan, is set to open in https://www.pna.gov.ph/articles/1082988) December 2019. (Source: Tony and Lulu Facebook Page)  The Department of Social Welfare and

Development (DSWD) Caraga provided a Transportation Service Expansion and grant amounting to PhP 4.4 Million to the Development Alingit Fisherfolk Multi-Purpose Association,

Inc. (AFMPAI) in Lianga town, Surigao del  Re-operationalization of City Airport Sur for the installation of ice plant and cold and City Airport in the 4th quarter of 2019. Page 20 of 21

 Modernized public utility buses commenced its operation in Butuan City.

(Source: Alexander Lopez,

https://www.pna.gov.ph/articles/1083307, 16

October 2019)

 Ground breaking of taxi services operated by the Balangay Transport Services Cooperative (BALTRANSCO) of Butuan City,

which was granted provisional authority to operate 50 units in the region. (Source: NewsLine Philippines, https://www.pna.gov.ph/articles/1083307, 16 October 2019)

 Additional Balangay Taxi units will be rolled out on 27 December 2019. Moreover,

MLhuillier Taxi will also be launched, which will be comprised of new Avanza, Mirage and Vios units. (Source: Butuan City Community Page, 27 December 2019)

Disaster Risk Reduction and Climate Change Adaptation and Mitigation

 Construction of “Road to Peace” projects in Agusan del Sur and Surigao del Sur, which will be implemented by the Department of Public Works and Highways with a total project cost amounting to Php 748.6 Million.

Said projects will improve access and delivery of services to conflict affected areas in the region. (Source: Department of Public Works and Highways Facebook Page, https://www.facebook.com/pg/dpwh13/notes15 October 2019)

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