The economy of Western Visayas grew by 6.1 percent from between calendar years 2017 to 2018 compared to 8.6 percent growth between 2016-2017. This was the report of Director Fred S. Sollesta of the Philippine Statistics Authority (PSA) Region 6, during the press conference on the 2018 Regional Economic Performance of Western Visayas on April 25, 2019 at the Grand Xing Imperial Hotel, Iloilo City. The region’s growth approximates the national average GDP growth rate at 6.2 percent. Total gross regional domestic product (GRDP) amounted to P372.87 billion from P351.38 billion in 2017 or P21.5 billion more in the value of goods and services produced in Region VI.

The 6.1 percent GRDP growth rate resulted in the region becoming rank number 12 among the 17 regions, excluding the NCR. However, in terms of magnitude or size, Western Visayas or Region VI remained the 5th largest economy outside of NCR. This performance demonstrates that the region has firmly laid the groundwork for continued progress in the future, being among the largest regional economies of the country.

Agriculture, Hunting, Forestry and Fishery or AHFF contributed 17.2 percent of total regional output.  Industry’s share was 24.7 percent, while Services contributed 58.1 percent, making the region still a service-oriented economy.  Services include transport, storage and communication, trade and repair of motor vehicles, motorcycles and personal and household goods, financial intermediation, real estate, renting and business activities, public administration and defense, compulsory social security and related activities.

Overall, the region had a slower growth in all sectors: with agriculture even decelerating by 1.4 percent.  The Industry Sector is almost the same (8.7 in 2017 to 8.6 percent in 2018), while the Service Sector decreased from 8.5 percent to 7.5 percent.    

RD Ro-Ann A. Bacal of NEDA-VI, discussed some of the factors which contributed to the GRDP performance.  The temporary closure of Boracay from April 2018 to October 2018 resulted to the decrease in visitors by almost 900,000 resulting to less customers for hotels and restaurants.  Less customers meant less orders for food items, including rice, vegetables, meat, fish, eggs, fruits, etc., not to mention pasalubong items. Less demand for the products, meant less consumption income for affected families.

The closure also resulted to foregone revenues from the LGUs. Basing only from collections of terminal and environmental fees, at an average daily tourist arrival then of about 5,941, the LGUs experienced losses of about P1.93 million daily or P57.92 million per month or an estimated P347.52 million for the 6 months.  The loss of this revenues meant that programs and projects that would have been charged to this local fiscal resource were not realized.

Despite unfavorable conditions last year, the region was the 3rd highest producer of palay in the country, next to Cagayan Valley and Central Luzon. Sugarcane output, mostly in Negros Occidental decreased by 26.2 percent owing to the reduction of sugarcane planting areas in the Western Visayas in response to low prices; smaller cane because of reduced fertilizer use in Central Visayas; and the early cut-off of milling operations in Northern Mindanao. The livestock, poultry and fishery products, on the other hand, experienced decreases in overall production. Due to less supply, demand for products increased resulting to a high food inflation rate (8.4 percent in 2018 from 2.1 percent in 2017).

The upbeat performance in public construction (from 4.3 percent to 14.3 percent), on other other hand, resulted in demand for skilled and unskilled labor.   The regular infrastructure projects of the government as well as in the private sector is expected to drive construction-related activities in the region; e.g. increased quarrying, importation of construction materials, opportunities for small-time ventures near the workplace, and, upon completion, an enhanced delivery of public services. The groundbreaking and start of construction of the Jalaur River Multi-Purpose irrigation project Stage 2 bodes well for the economy covering the infrastructure, industry, and services sectors and is expected to contribute positively to the growth of Western Visayas, especially in the countryside.

Notwithstanding the slower growth of the economy, RD Bacal informed the participants that poverty incidence among families declined from 25.0 percent to 15.9 percent and among population, from 31.4 percent to 21.2 percent for the 1st Semester of 2018 compared to 2015 levels.

Domestic demand is expected to improve in view of the increase in salaries of government employees (4th tranche of salary standardization law) and in increase in the minimum wages from PHP 256.50 – 298.50 effective May 2015 to PHP 295.00 – 365.00 effective July 12, 2018 (per Wage Order Nos. 22 to 24).  The implementation of poverty reduction programs has also augmented the income of the population.

The BPO industry employed 21,500 workers in Iloilo City and 30,000 in Bacolod City in 2018. However, there is still a need to attract for more investors in the region in order to generate more employment opportunities and ultimately decrease the 18.6 percent unemployment rate.

Director Bacal also discussed what needs to be done in order to overcome the sluggishness experienced in 2018, which include: fast-tracking the implementation of infrastructure projects; improve the utilization of fiscal resources to pursue the region’s priority programs and projects; woo investors to establish their ventures in the region; local leaders to continually have a more competitive outlook in governance; and to relentlessly deliver the needed social services to populations in need.

During the open forum, questions included the significant contribution of the Boracay closure to GRDP, how the closure affected the AFF output, how the upcoming election can affect the economy, what drastic reforms should be instituted for the agriculture sector, making available provincial product accounts, and the decreasing output of mining and quarrying vis-à-vis the increasing demands of the construction industry.

The press briefing was attended by Assistant National Statistician Candido J. Astrologo, Jr. of PSA and was participated by representatives from line agencies, members of the media, private sector groups, SUCs and LGUs.