Mindanao investments down 63% in 1st half » Manila Bulletin Business

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Strong rebound seen as soon as Marawi crisis is over

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By Bernie Cahiles-Magkilat

Investments in Mindanao dropped by a hefty 63 percent in the first half of the year to P6.87 billion from P18.42 billion in the same period last year, but Trade and Industry Secretary Ramon M. Lopez expressed confidence of a strong rebound once the war in Marawi City is over, saying the government will pour in so much resources to implement a new masterplanned urban development to ensure Marawi can rise from the ashes a lot stronger, becoming a catalyst in the realization of the Mindanao promise.

Ramon M. Lopez

Board of Investments data showed that investment pledges in four Mindanao regions outside of the ongoing conflict area of Marawi City dropped substantially. Region 10 (Northern Mindanao) got P1.382 billion, 81 percent decrease from P7.304 billion, Region 11 (Southern Mindanao) with P3.210 billion or 49.74 percent down from P6.386 billion, Region XII (SOCCSKSARGEN) with P927.8 million or 77.11 percent down from P4. 054 billion, and Region 9 got nothing from P648 million last year. Investments in Region 13 (CARAGA) rose 100 percent with P1.35 billion in new projects from zero in the first semester last year. There was no data on the Autonomous Region of Muslim Mindanao (ARMM) where Marawi is part of. But Lopez explained that Marawi, at present, has a miniscule impact given that ARMM alone has only 0.67 percent contribution in the country’s gross domestic product.

“Maybe it’s just timing. Based on people we talk to there is still strong interest given the fundamentals and the strong promise of Mindanao especially in agri processing, energy, property development and manufacturing,” Lopez said on the steep drop in Mindanao investments.

He admitted that with the security issue, investors have to rethink the timing of their business, “but not changing the destination of their investments because the parameters and the givens are still there, like good soil and climate that are necessary for their projects.”

“Those (businesses) that are not yet there, they are studying the timing but confidence is still in areas outside of Marawi like Cagayan de Oro and Iligan because Marawi is not Mindanao.”

Investors, he said, have a better picture of the Mindanao situation but they are not withdrawing from Mindanao, “The numbers are still there.”

Lopez, however, said that once the war in Marawi City is over, all roads will lead to this city, benefiting the entire Mindanao.

“As soon as the Marawi siege is over, maybe this year, there will be much higher confidence level in areas outside of Marawi but Marawi will have the most dramatic economic improvement. There will be lots of opportunities and a spillover in the nearby areas but the impact in Marawi is immediate because the government will pour everything in there,” said Lopez.

“The government is master planning of a new Marawi City,” Lopez said.

President Duterte has committed a P10-billion budget for the rehabilitation of infrastructure destroyed during months of bombing that pounded the city to route the terrorist Maute Group. He was also seeking for a five month extension of Martial Law in Mindanao.

On the part of the DTI, Lopez said the agency will implement a P10-million livelihood assistance to the micro enterprises in Marawi.

On top of this, the agency will boost its micro financing for Marawi businesses under the government’s P3 or the Pondo sa Pagbabago at Pag-asenso, a micro-financing program at minimal interest rate with no collaterals.

So far, the government has allocated P1.5 billion for P3 but the Senate may further increase the fund for another P2 billion. The P3 has already covered 67 provinces in the country through its micro financing conduits and local cooperatives and non-governmental organizations.

The government is also extending P500,000 to families of those killed in action. There are now over 100 civilian casualties in Marawi.

“Once the war is over, rehabilitation will start with or without the extension of Martial Law. So, we have to allocate micro financing because most of the residents in Marawi are entrepreneurs,” Lopez said.

The massive rebuilding of Marawi, he said, will eventually benefit the entire Mindanao, which has not really been affected by the Marawi crisis.

“The promise of Mindanao is still there, the impact of Marawi does not mean it lost its potential because definitely it is still there,” he reiterated.

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