Focus, capitalize on strong sectors, says business chief

CARREON

Maintaining CV’S ECONOMIC GROWTH

The local governments and industries in Central Visayas should focus more on the sectors that have helped fuel the region’s economic growth to maintain its strong economic performance in the second half of the year.

Glenn Soco, Mandaue Chamber of Commerce and Industry (MCCI) president, made this call amid the region’s strong economic performance in the first half of the year.

Soco cited the need to focus on the sectors like business process outsourcing, agriculture, tourism, services and real estate.
“There is a need to put more focus and capitalize on information technology and the digital economy,” said Soco in a text message to Cebu Daily News.

Strong 6 months

Last week, National Economic and Development Authority Central Visayas (Neda-7) Director Efren Carreon reported that the regional economy remained strong during the first six months of the year despite all the challenges it faced in that period.

Speaking to members of the Central Visayas Regional Development Council (RDC-7) during a full council meeting, Carreon presented indicators that showed the strength of the region’s economy.

These included investor sentiment, export performance, the state of the IT-BPM industry, transport industry, tourism, agriculture, inflation, and employment, all of which recorded positive growth earlier this year.

“Central Visayas will still continue to be the economy, capital and gateway of the south,” said Soco, who also welcomed the region’s economic developments.

Infrastructure

He also said that Central Visayas is also poised to expand further with infrastructure projects earlier approved by the RDC-7.

Among these projects, which he said will be vital to the region’s growth, are the Metro Cebu Expressway, Mandaue-Consolacion-Liloan Bypass Road, Talisay-Minglanilla-Naga Bypass Road, as well as upgrading of the airports in Panglao and Siquijor.

Likewise, he said that the reintegration of Negros Oriental to Central Visayas will complement the region’s growth.

Exception

Philip Tan, MCCI past president, said Central Visayas, with Cebu at the center of it, has always been an exception to the whole economy of the Philippines due to its growth rate being higher than that of national figures.

Central Visayas grew by 8.8 percent in 2016, higher than the country’s growth rate at 6.9 percent.

“But inflation will somehow be affected. There will be too much demand and our capability in the supply chain will be challenged,” Tan said in a phone interview.

Demand-supply balance

With the boom in infrastructure in the region, Tan projected a possible shortage of skilled workers here — an indication that the region may be growing faster than its potential for growth absorption.

“We need to balance the demand side of growth and the supply side of skilled workers to really support all these developments,” said Tan.

To attract manpower and encourage retention, the business leader said costs would have to be higher to compensate for the increase in workers’ salaries.

He added that if the region does not become competitive, potential workers can always go somewhere where the benefits are better.

Tan also brought up other problems that will come as a result of growth, including traffic, garbage, flooding, and poor road conditions, all of which are already evident in Cebu.

In his presentation, Carreon said investors were bullish on the retail industry, with investments in this sector continuing to expand to the countryside.

He said sales growth is more modest during the period covered this year compared to last year mainly because 2016 was an election year.

Economic drivers

Tourist spending, OFW remittances, and higher disposable incomes also boosted domestic consumption.

Food and food service, electronics, and health products lead the growth of the retail industry during the six-month period.

Carreon also said the IT-BPM industry remains robust, with expansion in terms of operation and services offered ongoing as well as service offerings having evolved from contact centers to higher-value services.

“Cebu and Negros Oriental remain preferred destinations for outsourcing companies despite losing spots in Tholons’ list of top outsourcing sites,” he said.