Cebu’s rosy outlook
IT WAS a good year for Cebu amid the challenges that tried to slow down its growth.
The Cebu business community described the beginning of 2016 as full of anticipation as the country elected a new leadership. Its members also described the fourth quarter as exciting and a defining period for business.
The last few months of the year, according to Melanie Ng, president of the Cebu Chamber of Commerce and Industry (CCCI), were exciting as the Duterte administration bared its 0-10 socio-economic agenda, opened the country to more trade opportunities by reaching out to neighboring Asian countries, which prompted the business community to recalibrate their efforts and even revisit existing sisterhood economic ties.
According to the National Economic Development Authority (Neda) 7, the business chamber of Cebu and Mandaue revealed that business sentiments in the region remain positive.
Construction up
Neda 7 Director Efren Carreon said the 2016 local economic growth was better than 2015 on the back of the positive performance of key industries, such as construction.
Neda 7’s gross regional domestic product (GRDP) growth target in 2017 is between 5.6 and 6.1 percent. But Carreon said he expects Central Visayas’s GRDP to grow by six to seven percent.
He noted the region had a better construction figure in the first semester of 2016, unlike the previous year where the sector pulled down the region’s economic performance.
Volume of new projects in the first semester in Cen- tral Visayas rose by 106.8 percent from 4,123 in 2015 to 8,525 in 2016. The number of projects in Cebu grew by 108.8 percent.
A growing middleclass market and price stability in the first semester of 2016 stimulated consumer spending. Big retail companies in the region also reported profit hikes.
Inflation in the first semester of 2016 stood at 2.8 percent compared to 2.4 percent during the same period in 2015.
As for the region’s labor market, Neda 7 showed that employment rate, as of last October, stood at 94.9 percent from 94.6 percent in 2015.
Cebu’s IT-BPM sector is expected to generate at least 20,000 new jobs this year.
Unemployment in the region fell from 5.4 percent to 5.1 percent, while the underemployment rate also fell from 16.8 percent to 16.1 percent.
Ng said Cebu was
Cebu’s rosy outlook flooded with “swirling opportunities” in 2016 amid the political transitions in the country and in its major trading partner the US, political controversies, chronic traffic congestion, and security issues, among others.
“In 2016 we were put in the midst of addressing the swirling opportunities that came our way. We were not able to grab it all, but it allowed us to see our competencies, and where to leverage in our respective businesses,” she said.
New opportunities
Glenn Anthony Soco, president of the Mandaue Chamber of Commerce and Industry (MCCI), shared the same sentiment, saying Cebu had the best economic scenario in 2016 with an economic growth that is impressive and economic indicators that are positive.
“It is a transitory year but a good year for business. This is also a preparation year for what will happen in 2017,” he said.
In the fourth quarter of 2016, some Cebu businessmen joined President Duterte in his state visits to China and Japan.
Ng said these trips opened more opportunities for trade and investments and created and strengthened linkages with counterparts in Asia.
During the President’s state visit to China last October, the Philippine government closed a $100-million contract for fruit exports to China, along with the lifting of the Chinese ban on Philippine bananas and mangoes.
Russia also committed to import around $2.5 billion worth of Philippine fruits, grains, and vegetables in the next 12 months.
Several foreign representatives from other countries also met with local business chambers to explore trade potentials in Cebu following Duterte’s pronouncements that the country is open to business and welcomes more investments.
Growth rate
According to Neda, the Philippines has one of the fastest growing economies in Asia, faster than China, Vietnam, Indonesia, and Malaysia.
“With a seven percent GDP growth in the first three quarters, we are sure to achieve, if not surpass, our target of six to seven percent growth for the whole of 2016, said Neda Socio-Economic Planning Secretary Ernesto Pernia.
“2016 was a colorful yet another good year for Cebu and the country. 2017 is another promising year because there seems to be no abrupt change in the international economic scene which can derail expected growth from planned government spending on infrastructure next year,” said CCCI’s past president Ma. Teresa Chan.
Neda said business outlook is bullish for 2017 as a result of Duterte’s state visits to China, Japan, and Asean (Association of Southeast Asian Nations) countries; and the ongoing, pipelined, prospective major public investment projects.
“Our chairmanship of the Asean Summit this year will be a perfect opportunity for the Philippine government to forge more partnerships with our neighbor countries,” Neda said.
With a good growth performance, Neda is setting the country’s 2017 GDP (gross domestic product) growth target between 6.5 and 7.5 percent.