Economic recovery is now in sight.

The region saw a promising re-emergence or resurgence as the economy achieved a reversal from the previous year’s economic doldrum. Strategies on scaling up of the vaccination rollout, relaxation of mobility and border restrictions, and reopening of multiple sectors underpinned expectations of continued economic revival paralleled by improved business and consumer confidence.

On the Road to Recovery

The MIMAROPA economy bounced back in the second year of the pandemic. The Gross Regional Domestic Product, or GRDP, grew by 3.3 percent, a rebound from the 7.5 percent contraction recorded in 2020. This may be attributed to the measures in managing the pandemic such as the imposition of granular lockdowns and the accelerated or aggressive campaign for vaccination, which also ran simultaneous to the gradual reopening of the economy, the implementation of the BBB program and ELCAC WONA initiatives.

On the supply side, growth was driven by the contributions from Services, which is 45.6 percent; industry, 34.8 percent; and agriculture, forestry, and fishing, 19.6 percent.

The Services sector experienced a robust growth as all sub-sectors have expanded except for financial and insurance activities.

Despite a minimal 2.0 percent growth in accommodation and food service activities, it marked a huge improvement over -45.6 percent drop in 2020, which can be attributed to the relaxing of travel restrictions and opening of tourist spots in the region.

Notably, the growth in the Services sector was brought about by the sizeable expansion in human health and social work activities at 17.1 percent and information and communication at 11 percent that was driven largely by online business opportunities, increased internet connection demand and usage, and continuous shift to virtual meetings and activities.

Education also rebounded with 8.7 percent growth after contracting by 5.7 percent in 2020. Under the Education Service Contracting of the Government Assistance to Students and Teachers in Private Education, or GASTPE, 27,307 students were provided financial assistance, amounting to 247 million pesos. Meanwhile, 22,690 students were provided with financial assistance under the Senior High School Voucher Program, which amounted to 341 million pesos. Moreover, a total of 965 million pesos was released for the Tertiary Education Subsidy Program under the Free Education Law, or the Universal Access to Quality Tertiary Education Act. Some 47 million pesos was also released for the Tulong Dunong Program and 742 million pesos for the Free Higher Education Program.

As we can see, no learners were left behind, even in the face of the pandemic.

Construction sub-sector achieved a 13.2 percent growth from -23.4 percent in 2020. This is largely due to the Build, Build, Build Program of the government. The new Calapan Port Terminal is expected to be operational within the year to complement the new Batangas Port Passenger Terminal now in operation. Manufacturing also recorded a 5.4 percent growth that contributed to the total industry sub-sector recovery of the region

The Agriculture, Forestry, and Fishing (AFF) sector rebounded from a negative 2.0 percent growth in 2020 to a respectable 5.2 percent growth in 2021. The significant increase may be attributed to the increased volume of production of crops, livestock and poultry, and fisheries. In 2021, AFF accounted for 19.6 percent of the region’s economy compared to a 19.2 percent contribution in 2020.

On the demand side, growth in 2021 was buoyed by the steep rise in gross capital formation at 22.9 percent. The reversal was mainly attributed to rise in intellectual property products (IPP) and construction. The remarkable reversal in IPP from –28.6 percent in 2020 to 21.8 percent in 2021 was due to increased intangible fixed assets (e.g., royalties, patents), mineral exploration and evaluation, and entertainment, literary, and artistic originals.

Moreover, construction’s significant upturn from –27.5 percent in 2020 to 16.6 percent in 2021 can be attributed to the completion of critical infrastructure projects, such as the rehabilitation of national roads, construction and improvement of bridges, and build, repair, or maintenance of flood control structures.

Household consumption grew by 5.8 percent, which indicates the restoration of consumer confidence and abated infections as a result of easing quarantine restrictions and the accelerated vaccination.

Government expenditure also expanded by 7.1 percent. Further, external trade improved despite negative growth in 2021. Exports climbed out of –46.0 percent to –1.3 percent this year. The same trend can be seen in imports with –20.9 percent in 2021 compared to -28.8 percent in 2020.

Getting There

We can state with confidence that we can get back on track as we are traversing the path to a resilient recovery. However, we should be vigilant for the possible further outbreaks of COVID cases, natural disasters, and the ongoing impact of Ukraine-Russia conflict.

Since April 15 of this year, more than half of the country’s economy has already shifted to alert level 1, where indoor capacity of businesses and travel restrictions are friendlier to the public than last year’s. NEDA estimates that under alert level 1, the economy is expected to gain around 10.8 billion pesos per week of economic activity and reduce the number of unemployed persons by around 195,000 this quarter.

The accelerated vaccination deployment and improvements in the healthcare system in the region will continue to contribute greatly in hastening economic growth. These will also pave the way toward the full reopening of the economy and other social activities such as face-to-face learning and school activities. Increased productivity will be the key for increased economic activities and income opportunities.

The updated Philippine Development Plan and the Regional Development Plan have been fine-tuned as well to recommend policies and maximize investments in human capital and reduce infant mortality and fertility rates. This would lead to accelerated economic growth driven by a change in the population structure where adolescents and young Filipinos can reach their potential and significantly contribute to the workforce.

We also look forward to realizing the proposed fiscal policy interventions on improving our growth prospects and managing supply and prices of key commodities to support the transportation and agriculture sectors. Timely social protection measures could also help cushion the impact of rising fuel prices. Efforts to safeguard sufficient domestic food supply could ease further upward pressures on inflation.

Moreover, the catalytic role of connectivity infrastructures and port city development remain remarkably vital in the economic recovery of MIMAROPA. These interventions are seen to create agglomeration economies with benefits hinting at increased tourism spending, reduction of industry barriers, and larger market areas.

MIMAROPA is physically proximate to the greater capital region, but economically distant from it. We will utilize this geographic advantage to advance our economic development objectives. We are prepared for the next level of development by implementing smarter infrastructures, focusing on innovation for basic sectors such as agriculture and fisheries, and putting premium on climate change adaptation and mitigation at the core of development planning.

We recognize the role of innovation in the country’s structural transformation and transition to high-income country status. We shall sustain our regional economic growth by innovating in our strongest sectors. This will be one of the priorities in the next development plan.

Later this year, the next Regional Development Plan and Regional Physical Framework Plan will be crafted. We remain steadfast to providing relevant and evidence-based analysis and recommendations in relation to the reinvigorating the region’s economy.

Our Call to Action

All of our efforts in 2021 have made it clearer for us to find the silver lining out of the difficulties we have experienced in the past two years.

Our resolve to collaborate will further crystallize our shared vision to create wealth income opportunities and jobs.  As we remain committed in delivering and improving public goods and services, we are coming back strongly in order to rebuild the economy of the region and create equitable change and sustainable future for all.

Patuloy tayo sa pagsulong ng Ambisyon para sa matatag, maginhawa at mapanatag na buhay para sa lahat.