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as of May 2005 indanao A Publication of theM Mindanao Economic Development Council (MEDCo) Updates investments AGRICULTURE trANSPORTATION fOreign trade tOurism griculture a Rice Total palay production in Mindanao reached 3.4 million MT in 2004, 5.9% higher than the 2003 output. This output gain was likely the result of wider harvest area and improvement in yield per hectare in irrigated and rain-fed farms. ’ Among the regions, ARMM had the highest ex- Mindanao s ECONOMY pected output growth this year at 26.3% while Regions IX and XII likewise displayed significant output increments at 6.1% and 3.9%, respective- ly. Harvest area in Northern Mindanao, however, n 2004, Mindanao’s economy consistently showed remarkable resilience was contracted by 4.1% due to the shifting of some producers to cash crops and the high cost brought about by the strong support of the agriculture and services I of palay inputs. sectors. Mindanao’s agriculture, fisheries and forestry sectors are expected to post a 2004 year-end growth of 3.8%. Services, the fastest-expanding sector in the past five (5) years and the largest contributor to Mindanao’s GDP growth in 2003, is projected to post a 4.4% year-end growth in 2004. The growth on the services sector was spurred mainly by the recovery of the transportation, communication and storage subsectors. The industry sector Corn likewise shall expand by 3.3%, propelled by significant contributions of the Corn production also performed significantly with a 11.5% mining and quarrying and manufacturing subsectors. growth brought about by the 3.0% expansion in the harvest areas, availability of quality seeds and better market prices which encouraged farmers to plant corn. Corn output increments were noted in most regions particularly in Regions X, XII and XIII. However, a slowdown in output was reported in ARMM due to slight worm infestation in Basilan, floodings in Maguindanao, landslide in Lanao del Sur and dry spell in Tawi-Tawi . Livestock Livestock and poultry outputs also exhibited positive increments this year compared to their 2003 performance particularly carabao, goat, swine and chicken production. While these sectors maintained their favorable performance during the first half of the year, livestock and poultry producers increased production as market demand for these commodities dramatically increased especially during the last few months of 2004. griculture a Rice Total palay production in Mindanao reached 3.4 million MT in 2004, 5.9% higher than the 2003 output. This output gain was likely the result of wider harvest area and improvement in yield per hectare in irrigated and rain-fed farms. ’ Among the regions, ARMM had the highest ex- Mindanao s ECONOMY pected output growth this year at 26.3% while Regions IX and XII likewise displayed significant output increments at 6.1% and 3.9%, respective- ly. Harvest area in Northern Mindanao, however, n 2004, Mindanao’s economy consistently showed remarkable resilience was contracted by 4.1% due to the shifting of some producers to cash crops and the high cost brought about by the strong support of the agriculture and services I of palay inputs. sectors. Mindanao’s agriculture, fisheries and forestry sectors are expected to post a 2004 year-end growth of 3.8%. Services, the fastest-expanding sector in the past five (5) years and the largest contributor to Mindanao’s GDP growth in 2003, is projected to post a 4.4% year-end growth in 2004. The growth on the services sector was spurred mainly by the recovery of the transportation, communication and storage subsectors. The industry sector Corn likewise shall expand by 3.3%, propelled by significant contributions of the Corn production also performed significantly with a 11.5% mining and quarrying and manufacturing subsectors. growth brought about by the 3.0% expansion in the harvest areas, availability of quality seeds and better market prices which encouraged farmers to plant corn. Corn output increments were noted in most regions particularly in Regions X, XII and XIII. However, a slowdown in output was reported in ARMM due to slight worm infestation in Basilan, floodings in Maguindanao, landslide in Lanao del Sur and dry spell in Tawi-Tawi . Livestock Livestock and poultry outputs also exhibited positive increments this year compared to their 2003 performance particularly carabao, goat, swine and chicken production. While these sectors maintained their favorable performance during the first half of the year, livestock and poultry producers increased production as market demand for these commodities dramatically increased especially during the last few months of 2004. oreign trade foreign trade transactions in Mindanao are projected to remain Fbullish this year as export growth is targeted to reach 5.9% from US$1.4 billion in 2003 to US$1.5 billion in 2004 . Our top five (5) traditional export products include coconut oil, banana, tuna, fresh pineapples and iron ore agglomerates. Nickel ores, along with iron ore agglomerates, were among the major industrial export products of Mindanao. Japan, USA, Netherlands, South Korea and Taiwan remain as Mindanao’s top five (5) export destinations. Combined US and Japan markets capture 71.7% of the total exports share of Mindanao. Singapore, meanwhile, is considered as a major export market for the island’s coconut oil and tuna products. IMPORTS are projected to decline by 11.0% as of year-end n general, Mindanao is seen to enjoy a 22.6% 2004. Mindanao still regularly imports flat-rolled products of iron, growth in trade surplus for 2004. wheat, milk, iron ore and concentrates and kraft liner. Majority I of Mindanao’s imports are sourced from USA, Vietnam, Brazil, Japan and New Zealand. Thailand and China emerged as two of our major non-traditional sources of products this period where we imported more than US$65.8 million worth of goods, particularly flat-rolled products of iron, rice, fertilizers (urea and ammonium sulphate) and fabrics (textile). investments A number of new investments continued to pour in Mindanao. Based on BOI data alone, the number of registered projects shot up by 38.1% in 2004 and targeted to generate 7,243 jobs. Total value of these registered investments reached P7.81 billion in 2004 or a 279.6% growth from P2.06 billion in 2003. Meanwhile, a total of nine (9) new investment projects were registered at the PHIVIDEC Industrial Authority with a total project cost of P1.6 billion and are expected to generate at least 283 job opportunities. Almost all Among the newly registered investments, the distillery of the BOI-registered investments were already in their plant of Ginebra San Miguel, Inc. emerged as the biggest commercial operations while six (6) of the PHIVIDEC- investor in PHIVIDEC with a P1.4 billion project cost. The registered projects are currently in their planning and said investment is already in its pre-construction stage. construction stages. Majority of these investments are Meanwhile, the Global Steel Works International, Inc. which geared on food processing and large-scale agricultural bought the National Steel Corporation (NSC) in Iligan City production. was the biggest investor registered in the BOI with a P6.1 billion project cost. Mindanao Updates 4 oreign trade ransportation t employment n 2004, the economy employed 7.8 million Mindanaoans, of which more than half (51%) were in the agriculture Isector while 39% were in the services sector . An increase in employment was observed from the agricul- ture sector (3.7%) due to improved harvests and in the ser- The number of air passengers was significantly increased by vices sector (6.6%). Most of those who are in the services 7.3%. This was brought about by increased tourism activities sector either work in the wholesale and retail industry (e.g. among the Mindanao regions as well as the conduct of the malls and department stores) and in the transportation and important holidays (e.g. All Saint’s Day, Christmas, etc.) during communications industry. More than half (57%) of those the period. The Davao City International Airport is still the who have work were full-time employees , while 41% of the busiest airport in Mindanao accommodating approximately employed persons were underemployed or those who work 1.4 million incoming and outgoing passengers. Cagayan de less than 40 hours a week. Oro Airport is the next busiest airport admitting more than 0.5 million passengers. Air cargo likewise improved by 3.1% this Unemployment remains stable as it posted 7.9% of the la- period brought about by increased reliance of businessmen bor force compared to the country’s overall performance; a and passengers for faster shipment of goods and products reflection of the island’s vital capacity to generate enough to other destinations. jobs to keep up with labor force growth, which itself is a function of the rapidly rising population. Meanwhile, sea passenger performance posted a 2.5% increase this period. Disembarking passengers comprised the majority (51%) of the sea passenger traffic among the Mindanao ports while 49% were embarking passengers. The relative growth in the volume of sea passengers may still be attributed to the increased tourism activities in the various Mindanao regions. Sea cargo traffic, on the other hand, maintained its performance in 2004 which can be attributed to the continuous transportation of goods to and from the Mindanao ports. tourism indanao’s total visitor arrivals are estimated to grow by the tourism week observance of other key destinations in M8.9% from 2.2 million in 2003 to 2.4 million in 2004. Mindanao. While majority of these visitors are domestic travelers, the number of international visitors are also expected to rise. The Department of Tourism (DOT) further noted that the attractions of these areas for investment opportunities Regions X and XI are the major tourist destinations in provide reasons for both domestic and foreign visits.