BIZ LEADERS’s region’s H2 OUTLOOK
The services and tourism sectors are expected to drive the economy of Central Visayas in the second half of 2017, helping the region to even surpass its economic growth in the previous year.
Glenn Soco, president of the Mandaue Chamber of Commerce and Industry (CCCI), said this (the economic growth) would be driven by the region’s strong service sector.
“The local economy continues to be robust. Although there might be effects on the tourism sector for this year, but this will be compensated by other sectors like retail, real estate, and BPO (business process outsourcing), which will sustain our growth momentum,” Soco told Cebu Daily News.
Philip Tan, MCCI past president, also said that he too would be expecting the region’s economy to grow between 5 to 10 percent this year, but this would depend on how the industry would deal with the issues regarding tourism in the next six months.
Tan said as he believed that tourism would continue to be one of the drivers of the region’s economy if the issues faced by the sector would be addressed.
He was referring to hurdles faced by the tourism industry in the first half of the year because of the several travel advisories issued by the US and European countries as well as the Abu Sayyaf group encounter in Bohol among others.
2016 growth
In 2016, Central Visayas grew by 8.8 percent, ending the year with a P525-billion gross regional domestic product (GRDP) and cementing its place among the fastest growing regional economies in the country.
The services sector had the biggest contribution to the growth with 55.5 percent share. The Industry sector contributed 39.1 percent, and agriculture, forestry and fisheries contributed 5.9 percent.
In terms of growth, industry sector registered the highest growth, specifically the construction subsector, which grew by 40.4 percent.
The services sector grew by 5.9 percent while the agriculture, forestry and fisheries sector contracted by 0.6 percent.
Fourth fastest economy
The region registered the fourth fastest economic growth in the country after Eastern Visayas (12.4 percent growth), Central Luzon (9.5 percent growth) and Davao Region (9.4 percent growth).
But while the region continued to grow in the first half of the year, Tan said that the tourism sector’s contribution would continue to play a big role in helping the region to hit its economic targets in the second half.
“We need to anticipate the performance of tourism and how it is being affected by the current situations. If the tourism sector will not perform as expected, then we might not be able to hit those targets,” said Tan.
5.9M visitors in 2016
Central Visayas saw gains in the tourism industry in 2016 and while there are no official data for the first half of 2017 yet, sources said arrivals have been strong despite security issues the country has been facing since the start of the year.
Data from the Department of Tourism in Central Visayas (DOT 7) showed that the region welcomed 5.95 million tourists from January to December 2016, up by 29.17 percent from 4.6 million during the same period in 2015.
“Tourism is the backbone of the economy because it has a multiplier effect. Restaurants, hotels, consumer spending, retail outlets, and logistics complete the cycle,” he explained.
The business leader said stakeholders should make sure tourists feel good about coming to the Philippines by creating an image that the Philippines is an interesting place to visit.
Investments
Tan said he also hopes to sustain the growth of the construction industry, pointing out the need for sustainability through 2018.
“So far, we have many ongoing projects, but if there aren’t any new ones that will be started, we will create a vacuum in the first quarter of 2018,” he said.
Cebu and Central Visayas are assured of more investments when business confidence, whether among foreign or local investors, is high.
Among the external or internal factors that Tan cited which may affect investor sentiment include tax reforms, depreciation of the peso against the dollar, and fluctuating oil prices.
He also pointed out that the purchasing power of the locals, which is spurred by employment, serves as the lubrication of the economy to move forward.
Gov’t spending
Melanie Ng, Cebu Chamber of Commerce and Industry (CCCI) president, said the organization was confident the region would equal or even surpass its growth in the previous year.
Ng anchored her optimism on the increase in government spending and private sector investments, particularly in the areas of construction and manufacturing.