‘Fire-breathing’ ECONOMY IN THE YEAR OF THE DRAGON

DAVAO Region’s unique geographic position and diverse community contribute a significant strategic role to its accelerating and robust-expanding economic landscape.

In fact, foreign businesses, particularly East Asia and first-world nations such as the United States of America, invest their interest in all pillars that shaped the positive foundation of the jurisdiction today.

Based on the 2024 Socioeconomic Performance and Development Outlook in line with the performance and inflation report provided by the National Economic Development Authority - Davao Region (Neda-Davao), the Philippines’ top-performing region and the industry hub of Mindanao is forecasted to have competitive changes in the economic development, social development, environmental management, institutional development, and peace and security.

This, as strategically curated under the Davao Regional Development Plan (DRDP) blueprint for 2023 to 2028 of the Regional Development Council (RDC), anchored on the Philippine Development Plan (PDP) and on the eight-point socio-economic development agenda of the Marcos Administration to further alleviates the life of every Dabawenyos.

2024 Davao Region Economic Outlook

Over the years, agriculture accounts for the majority of the region’s Gross Domestic Product (GDP). However, the area has also increasingly become a hub for commerce, business, and tourism. Its exports of papayas, mangoes, bananas, pineapples, fresh asparagus, flowers, and fish goods give it a competitive edge in agribusiness. The area serves as a gateway to markets in other regions of Mindanao, Brunei Darussalam, and some sections of Malaysia and Indonesia.

Inflation

In 2022, the average inflation in Davao Region was recorded at 7.2 percent compared to 6.3 percent in 2023 as reported by the Philippine Statistics Authority (PSA) wherein the increase is primarily attributed to the acceleration in the Food and Non-Alcoholic Beverages sector.

However, Neda-Davao’s recent data showed that in 2024, prices of basic commodities are poised to remain at manageable and moderate levels and that several factors to be considered in determining and achieving low inflation are: Reduced tariff rates; mitigate the impacts of El Niño; intensive social assistance via subsidies; stable global oil prices; sustained remittance flows; higher employment; and increasing the value of the country’s currency.

Labor and Employment

The region for the past three years has tallied a high employment rate. In 2021, it recorded 94.5 percent, 96.5 percent in 2022, and 97.1 percent in 2023.

In the Year of the Dragon, the regional economic agency aims to have stronger employment facilitation through the Philippine Employment Services Office (PESO) Employment Information System and PhilJobnet, implement and maintain a more user-friendly job-search database; consistency of implementing programs aimed at assisting the vulnerable sectors and individuals across all walks of life; following the labor law; and enhancing the role of Regional Tripartite Industrial Peace Council (RTIPC) in advancing social dialogue and raising awareness about its services.

Investments

Currently, the Neda-Davao supports the programs of the Department of Trade and Industry in the region in strengthening the condition of the micro, small, and medium enterprises (MSME) through innovation and technological advancement.

The collaboration of the two agencies is also anchored on the National Innovation Agenda and Strategy Document (NIASD) which contains the country’s vision and long-term goals for innovation or to transform the country into a Smart and Innovative Philippines that is productive, resilient, sustainable, and inclusive.

As the Year of the Dragon unfolds, the Philippines is developing a strategy to turn Mindanao’s Davao Region into a premier logistics hub, first as a substitute for Singapore.

It is anticipated that the creation of an international logistics center in the Davao Region will draw in more capital, strengthen the region’s economy, promote trade, and enhance connectivity.

However, the initiative has two significant obstacles to overcome. The facilities at seaports and airports fall short of international standards, and there is little integration of the transportation networks. Sasa Port features a small port as well as a tiny dry dock. The airports in Davao and Mati are outdated. The land transportation terminals, seaports, and airports are not connected. Additionally, the area needs a productive urban mass transit system.

To carry out the project, the regional development plan is using a three-pronged approach. It entails enhancing the system of multimodal freight transportation, quickening the construction of logistics system infrastructure along the Davao Gulf, and harmonizing land use plans, ports, and logistics operations.

Foreign Trade

Neda-Davao revealed that foreign trade in the region may be affected due to the unpredictability of the global economy and constraints in terms of exportation and importation.

In the third quarter of 2023, the export value of the Davao Region amounted to USD 1.67 billion with top exports in Banana, Coconut Oil, Other Fruits and Vegetables, Processed Food, and and Gold.

Tourism

Davao Region has been an attractive destination for investment, more particularly in tourism and one of the major programs that Davao region has been preparing for is the expansion of outbound and inbound flights.

In line with this, the Department of Tourism-Davao Region (DOT-Davao) Regional Director Tanya Rabat wants Davao City, the business capital of the region, to have more international flights linking the city to different parts of the globe.

These international flights will help in Davao Region’s goal of positioning itself as a premiere adventure destination not just in the country but also in the Asean region. Among its major programs is the Davao Adventure Challenge, a year-long campaign of DOT-Davao Region that will introduce Davao’s unique natural attractions and eco-adventure escapades, especially from beaches to mountains.

Currently, Qatar Airways only runs one weekly flight from Davao to Doha, Qatar. There are three weekly flights from Davao to Singapore on low-cost carrier Scoot, and two weekly flights from Hong Kong to Davao on Royal Air.

The Davao to Manado route will also be opening this year.

Agriculture

This Year of the Dragon, the Department of Agriculture-Davao Region (DA-Davao), will put up major policies into place, the region will be able to maintain the increase of its agricultural output in major Agriculture, Fisheries and Forestry (AFF) sub-sectors such as fisheries, livestock, and palay. This means that the agency will integrate climate change into plans, projects, and programs related to agriculture (such as Climate Risk Vulnerability Assessment); prioritize research and development (R&D) programs and investments; make investments in and improvements to logistics, transportation, storage, and postharvest facilities; and lastly, improve facilities for the identification, diagnosis, and management of pests and diseases affecting plants and animals.