CV posts modest growth
Economic expansion in Central Visayas slowed down last year, growing only 5.1 percent but the region remained the country's fourth largest economy valued at P551 billion in 2017.
The culprit to last year's growth was the 0.9 percent contraction in the construction sector, said National Economic and Development Authority regional director Efren Carreon in a press conference yesterday with the Philippine Statistics Authority.
"The slowdown in the construction has some positive aspects. The number of nonresidential construction continued to increase although this came with a drop in new residential construction," Carreon said.
He noted real estate players have cited the complex process in securing permits and licenses as among the key reasons why construction projects fizzled in 2017.
Some analysts, he added, have also said Cebu's market for residential condominium is nearing the ceiling, evidenced by slower rate of sales and rising share of property buyers from areas outside Cebu.
Central Visayas failed to hit the 6.4-6.9 percent target for last year, based on the Regional Development Plan.
It was also lower than the 8.6 percent gross regional domestic product (GRDP) growth in 2016.
This year the region targets to grow 6.9-7.4 percent.
Carreon believes last year's growth is still respectable given key growth drivers remained robust.
The services sector — which comprises the region's main growth drivers tourism, BPO, IT, and trade, among others — continued to grow last year and still post positive prospects this year.
Services grew 6.3 percent and accounted for 56.3 percent of the regional economy.
The agriculture sector also made a big rebound in 2017, growing 7 percent as production increased and few calamities hit the region last year, Carreon said.
Industry sector grew slower by 3 percent because of growth decline in construction, mining and utility subsectors; but notable the manufacturing subsector saw a 5.5 percent growth.
Carreon believes growth prospects this year look robust with the opening of Mactan-Cebu International Airport Terminal 2 and the new Panglao International Airport in Bohol.
"There are also a number of ongoing construction projects by private developers. At the central business district of Cebu alone, there are several construction projects at the Cebu IT Park and Cebu Business Park," he said, as he also cited Filinvest's Marina Town Project in Dumaguete City seen to provide additional 2,000 square meters of BPO office space in Negros Oriental.
Moreover, most positive about growth is the tourism industry.
The sector is expected to lead growth in the regional economy this year, he said.
"Hotel operators look forward to year-round high occupancy as tourist arrivals are expected to grow by 15 to 20 percent during the year," he said, citing the expansion of the region's tourist market.
Carreon expects airline companies to mount more direct flights from Cebu and Bohol whose new airport in Panglao will be ready by August.
Coming along with the growth in tourism is retail. The sector is also expected to see growth this year but may have to brace for stiffer competition from online retailers.
Furthermore, the IT-BPO sector is still projected to produce most jobs in the region.
KPO, which offers high-value services beyond the voice segment, is expected to grow at a faster pace.
Carreon also expects BPO players to continue expanding in the countryside to take advantage of local talents and high retention rates.
Overall, the economic planner was optimistic the administration's infrastructure buildup program will spur public sector investments in the region.
Among the big-ticket projects in the pipeline are the New Cebu International Container Port and the third bridge linking Cebu City and Cordova town.
In the planning stage are the Metro Cebu Expressway and a fourth bridge.