Ensuring Economic Growth

Current Situation

 

   The Gross Regional Domestic Product of Bicol reached P189.6 billion in 2008. The region’s GRDP growth rate in the past five years followed the country’s overall Gross Domestic Product growth rate, except in 2006 when Bicol’s economy dipped to a 2.6 percent growth on account of the successive strong typhoons that battered the region. It was followed by a record growth of 7.5 percent due to the massive rehabilitation of typhoon damaged infrastructure, utilities, and commercial and residential properties. In 2008, GRDP growth of 4.3 percent was the fifth highest among the regions of the country. 

 

   GRDP growth averaged 5.1 percent for the last five years. Bicol’s contribution to the country’s GDP remained at about 2.8 percent, ranking 10th among the regions. Despite positive growth in the economy, most Bicolano families remain poor.    

 

   Average yield of the region’s major agricultural crops is lower than the national average. Farmers do not practice new farming technologies. Land holdings are becoming smaller due to increasing population. Calamities affect agricultural production and productivity. The fishing grounds of the region are being destroyed due to illegal and over fishing. The destruction of coral reefs is unabated. Watershed denudation causes sedimentation of coastal areas. Commercial fishers encroach on municipal waters.  Inland bodies of water are silted.

 

   Mining and quarrying contributed a large share to GRDP and exhibited high, though un-sustained growth for the past five years. There are three large-scale and 14 small-scale mining projects in the region. This sector, however, has been blocked by protests by anti mining and environmental groups, especially after two spill incidents occurred in the Rapu-rapu mining site that eventually led to a suspension of its operations in 2005 and 2006. 

 

   Electricity generation is a major industry in the region, with the region’s geothermal energy plants in Tiwi and Sorsogon contributing a substantial share to the Luzon grid. Despite the clamor of Bicolanos, high power rate persists. The potential for geothermal energy is not fully tapped despite government's efforts to promote investments in this sector.

 

   Construction has recently shown growth potential as its share increased from 5.9 percent in 2004 to 8.8 percent in 2008.  Infrastructure projects lined up for implementation within the region are expected to further boost these construction activities. 

 

   On the other hand, the share of the manufacturing sector remained at about 1.3 percent, despite growing at a respectable average rate of 4.1 percent for the past five years.  Growth in this sector has been hampered by high power rates and inadequate infrastructure facilities. These factors and the unreliable supply of raw materials discourage investors to come to the region.  

 

   The services sector was the most resilient, growing at an average rate of 4.3 percent and contributing the largest share (43.6 percent) to GRDP. This sector propped up the regional economy. Transportation and communication, trade, and tourism sub-sectors contributed a combined share of 27.2 percent and exhibited relatively high and sustained growth. Ownership of dwellings and real estate is also a potential driver on account of its 8.4 percent average contribution to GRDP.

 

   In terms of employment, agriculture and fishery employ the most number of persons in the region. Persons employed in these sub sectors comprise about 46 percent, while the services sector employs about 42 percent. Under the services sector, trade and transport/communication have a big slice of the labor market.  Tourism remains to be a strong source of employment. The industry sector employs 12 percent of the region’s workers.   

 

   The challenge is to accelerate and sustain growth in the economic sectors which contribute a large share to GRDP, employ the bulk of workers in the region, or are potential job generators, and has comparative advantages. These sectors are agriculture, fishery, trade, transport and communication services, tourism, and manufacturing. Moreover, economic growth and employment generation should increase family incomes in order to contribute to poverty reduction and improve the level of human development among Bicolanos.

 

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Desired Situation

 

   Bicol shall be an economically self-sustaining region. The people are gainfully employed and are receiving adequate compensation. The benefits of development reach the masses. Poverty incidence is reduced to zero. Food is available and affordable. Agriculture and fishery is able to produce the region’s food needs. The economic activities of production, processing, and distribution attract people to stay in the region. 

 

   Agribusiness companies in Bicol are globally competitive. Farmers and fishers manage their businesses. The supply of production inputs is reliable and available from local producers. Production systems are resilient to changes in weather patterns. Quality products are sold locally and internationally. Outputs from research and development are disseminated to target users. 

 

   Bicol shall be a primary tourist destination for ecological, agricultural, educational, and medical tourism in the country.  Tourist facilities shall be well maintained. There is access to these places through good quality roads, ports, and airports.  Tourists walk the streets undisturbed. Tourists go back to their homes with fond memories of Bicol. Local residents are educated on the importance of tourism as an industry

 

 

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Strategic Interventions

 

1. The region’s economic growth will be achieved through modern agricultural systems, modern fisheries, vibrant tourism, mining, and energy production. Agriculture production systems and practices will follow acceptable international standards. Organic farming shall be adopted. Self-sufficiency in food will be achieved by increasing average yields, opening of new areas for cultivation and adoption of advanced production technologies.  Plantation farming shall be promoted especially in pili and abaca.  Support services like extension, credit and marketing facilities shall be provided. Drip irrigation systems and farm to market roads will be constructed to support agriculture. 

2. Pili processing shall be developed. Pili plantations shall be established. Asexual propagation of pili seedlings shall be done in nurseries within the plantation. Processing of pili will be done at the farm level to ensure good quality of nuts, to reduce transport cost and to add value to the produce and to generate employment within communities. Research for new products from pili and prolonging its shelf life will be given highest priority. 

3. The abaca industry shall be revitalized. Selection of sites and of planting materials shall be done to prevent diseases. Tissue culture laboratories and nurseries shall be maintained to provide good planting materials. Trainings on the utilization and marketing of abaca fiber shall be conducted. 

4. Rice production systems will be developed to counter the effect of rising temperature and changing weather conditions.  Revised planting calendar, synchronized cropping schedules, and short season varieties will be introduced to farmers. New breeds of rice tolerant to drought, salinity and floods will be developed through research. State universities and colleges (SUCs) shall lead in research and extension. Warehouses will be established so that rice would be available during off season thus ascertaining food security in the region. Volumetric water pricing will be introduced to maximize irrigation water use. 

5. Corn production will utilize genetically modified varieties capable of producing high yields, resistant to pests and diseases and drought tolerant.  Corn grown in the region will be utilized for livestock and poultry feed production. Corn warehouses will be put up near the feed mills to ensure supply of raw material.  

6. High value crops will be produced through hydroponics. Cut flowers will be grown in green houses. These technologies will allow for the year round growing of vegetables and cut flowers. High value vegetables and cut flower production will be along the national highway strip. Efficient air and land transport systems will allow for the transport of vegetables and cut flowers to national and international markets. 

7. Coconut will be utilized for bio-fuel and geo-textile.  These commodities will be exported. Macapuno production will be increased and will be processed in the region. The production of embryo cultured coconut seedlings will be pursued to provide the needed planting materials. Mono cropped coconut areas will be devoted for multi-cropping or small ruminants’ production. 

8. Open upland and lowland areas and mono-cropped coconut areas suitable for agro-forestry will be planted to jatropha, pili and fast growing hardwoods. Jatropha oil will be used as an additive to diesel. The fast growing hardwoods shall be the raw material for the wood-based industries of the region.  Production forests will be planted to dipterocarps and minor forest species. The rehabilitation of the watershed areas where the headwaters of the irrigation systems originate has to be given high priority. This will also sustain water supply in the region.   

9. Goat-raising will be promoted for the production of halal meat. Silos for feeds and silage will be put up in strategic locations. These will ensure adequate supply of feeds. Improved goat strains will be introduced to farmers. Chicken for meat and egg production will be intensified using advanced technologies like tunnel ventilation of growing houses and highly mechanized operations. Modern chicken production will be supported by the establishment of a chick hatchery and construction of a feed mill in the region. Production and processing facilities for livestock and poultry will be established in the complex. Packaging and bottling plants will also be located in the area. 

10. Fish culture will be promoted in inland as well as marine areas. For inland fisheries, pangasius for fish fillet production will be introduced among fishpond owners. Production of tilapia in the inland lakes will be regulated to avoid overstocking. Mariculture will be intensified in Ragay Gulf and Lagonoy Gulf. Other suitable coastal areas will be devoted to mariculture.  Rearing of grouper, bangus and other marine fish species will be taught to municipal sustenance fisherfolks. Feed mills will be established. 

11. Bicol will be a prime tourist destination of the country.  There will be a sustained growth in local and foreign tourist arrivals. Efficient and reliable transport systems, affordable and clean tourism facilities and a hospitable population will be prime considerations in the influx of tourists. Tourism related festivals and activities will be aggressively promoted to lure local and international tourists to stay longer in the region. Quality and affordable souvenir items will be made available in strategic display centers to encourage tourists to spend more in the region. New tourist destinations will be developed and will be made highly accessible. With the support of private investors, additional tourism facilities and services will be constructed. 

12. With the presence of abundant mineral reserves, investors in the mining sub-sector will be attracted to the region. Gold and iron ore will be the primary metallic minerals to be extracted in Masbate and Camarines Norte. Limestone for cement making will be mined in Albay and Camarines Sur. Quarry materials around Mayon volcano will be extracted and exported to other areas of the country as well as to neighboring countries. 

13. Ensuring economic growth requires the support of the educational sector. Education will play a significant role in transforming new entrants to the labor force to go into agriculture, fisheries, and vocational courses. The trade school system will be re-introduced where vocational and technical courses will be an attractive alternative to tertiary education. Advanced research and development for new technologies will be undertaken by SUCs in collaboration with the private sector. 

14. Climate training centers shall be established in all provinces. Climate and weather data will be available from on-site agro meteorological equipment. Farmers and other producers will be trained how to use these data to plan their farm activities. Farmers and fishers will be provided with basic knowledge on climate forecasting and use in designing crop management strategies such as when to plant or start operations to minimize losses from weather disturbances. 

15. The transportation system of the region shall be made more efficient. Products and commodities will be able to reach their destinations on time and still of good quality. Farm to market roads will be converted to asphalt or concrete roads passable year round. Ports and airports will be interconnected through the land transportation arteries. The efficient rail transport system shall be able to transport passengers and cargo to Metro Manila and the Calabarzon area. Telecommunication systems shall be able to provide farmers and industry players with timely information on buyers, volume, and prices of their products.

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