Why the growing interest in the “VisMin economy” (Sabong News)
Author
John Tria
Date
APRIL 11 2022
Recent announcements regarding the national economy’s 5.7 percent growth in 2021 will definitely inspire confidence among many to imagine an even better recovery for their businesses and the over all economy for 2022.
Likewise, the latest surveys from the Social Weather Stations indicate the highest economic optimism since 2016 (https://mb.com.ph/2022/04/06/net-economic-optimism-highest-since-september-2016-sws-survey/).
Economic growth rates often arouse interest from prospective investors. When an economy grows fast then it means that there is room for individual business expansion. The size and growth of the economy are the firms that make up the different economic sectors. Thus, as firms and income keep growing, so will the economy.
This sentiment will boost confidence for those wanting to expand or restart expansion in the Visayas and Mindanao, or “VisMin” areas.
Note that In the last five years, to the performance of different sectors and regions, and the firms that do business in them outside Metro Manila, particularly the cities of Cebu and Davao have aroused interest from many.
Even the skylines of these two and other Vismin cities are clearly rising with commercial areas and condominium projects which attract investment since having developed areas make investing easier. Little wonder why the curiosity has grown in areas outside NCR. The “Vismin area “ is growing, and people are taking notice, and what to be a part of this growth.
This interest is because of two factors:
One is the impact of new economic reforms like lower taxes, and improved infrastructure that will spur economic activities, investment and investor interest in the Vismin area. These reforms channel higher levels of trade and expand to induce growth in various sectors, such as the service, manufacturing, and the agriculture sectors.
Another factor in evaluating the performance of such sectors are recent economic challenges, from the 2019 Trade war, the pandemic and the most recent Ukraine conflict that has increased the cost of fuel, travel and logistics.
Given both factors and their effects on local economies, the question increasingly asked is: which sectors posted growth or shrunk less, grew more, or which regions posted lesser declines compared with other regions and the nations GDP?
With this it is important to see which sectors of the Vismin economy must grow well into the future, so that they spur more growth in other sectors, and make the growth more inclusive.
In my view, the key industries that need to grow further in Mindanao in particular are the resource based industries such as responsible mining, sustainable forestry and modernized agriculture. I focused on these because this is where many of Mindanao’s lower income residents derive their income, or can avail of sustained livelihoods and achieve greater inclusion into the economy.
Unlike the rest of the country, Mindanao’s Agriculture, Fisheries and Forestry sector holds a substantial share of the total island economy and its over all employment. This sector produces not only food for household tables but also the raw material nèeds of the manufacturing sector, notably corn for the feed requirements of the poultry and livestock sector, and coconut for copra.
Mindanao’s agri sector also produces our main high value export crops namely bananas and pineapple, which are the major part of the roughly 9 and 10 percent of total Philippine GDP provided by agriculture.
Agricultural modernization reforms being pushed, such logistics improvements and mechanization inspire new thinking in agriculture, which is why such reforms must continue so that competitiveness of our agriculture sector increases over time.
More on the natural resources sector in the next column.
