Cordillera economy drops to 2.1 percent

By Dexter A. See

BAGUIO CITY  – The Cordillera office of the National Economic Development Authority disclosed the region’s Gross Regional Domestic Product (GRDP) dropped to 2.1 percent last year from 6.3 percent the previous year indicating a slump in the overall economic situation regionwide although economists ruled a 3 to 5 percent economic growth this year.

            

Dr. Leonardo Quitos, Jr., NEDA-CAR regional director, said the slowing down of the region’s economy was due to the decelerated growth of the industry sector that accounted for the bulk of the region’s economy with a share of 53.0 percent in 2011, slightly lower than its 53.1 percent share in 2010.

            

The Cordillera had an imbalanced growth in the industry and agriculture sectors, thus, the need for the government to infuse added funds to make the region’s agriculture sector resilient,” Aquitos, adding that the services sector’s share was 36.4 percent, an increase from its year-ago share of 36.2 percent.

            

According to him, the agriculture sector accounted for the lowest share at 10.6 percent which is lower than its 10.8 percent share the previous year.

            

“The industry sector decelerated from 8.6 percent in 2010 to a mere 1.9 percent in 2011,” he said, adding that the sector was kept in a positive growth due to the increase of manufacturing, the major contributor to the industry sector, but the sub-sector suffered a marked slowdown from 10.3 percent increase in 2010 to 4.3 percent last year.

            

Quitos explained the electricity and water supply sub-sector also slowed down from 7.0 percent in 2010 to 3.1 percent last year while mining and quarrying sank deeper to negative 11.4 percent from negative 0.3 percent the previous year due to the decline of gold production by the mining companies regionwide.

            

Moreover, the NEDA-CAR official claimed the construction sub-sector suffered a reversal in growth from a 4.1 percent growth in 2010 to a negative 6.0 percent in 2011 due to subdued public construction and severe government spending on the allocated funds for the purpose.

            

“The service sector also slowed down from 5.8 percent in 2010 to only 2.9 percent in 2011,” Quitos said, citing that the other services such as education, hotels and restaurants and medical services sub-sector cushioned the slow down with a remarkable increase of 9.3 percent last year which is almost four times its growth of 2.4 percent in 2010.

            

Quitos added real estate, renting and business activities also continued to accelerate from 3.8 percent in 2010 to an increase of 5.6 percent in 2011 with the help of the business process outsourcing activities that have rapidly grown mostly in Baguio City while the other sub-sectors also increased but also in slower paces, except financial intermediation which suffered a sharp reversal from a double digit growth of 24.6 percent in 2010 to a negative 7.7 percent last year and public administration from 5.9 percent to negative 3.0 percent last year.

            

He explained the agriculture sector had slowly reeled from the damages of Typhoon Pepeng several years ago and posted a modest growth of 0.4 percent last year from a negative growth of 2.7 percent the previous year.

            

“The fishery sub-sector showed a big reversal in growth from a negative 17.9 percent in 2010 to 3.1 percent last year while agriculture and forestry also rebounded from negative 2.5 percent in 2010 to 0.3 percent in 2011.

            

Quitos emphasized the service sector was the highest contributor to the region’s economic growth rate last year with 1.1 percentage points followed by industry that contributed 1.0 percentage points while the agriculture sector contributed the least with only 0.04 percentage points.

            

In order to enhance the region’s economic growth this year, Quitos cited the Regional Development Council (RDC) in the Cordillera mandated the National Irrigation Administration (NIA) to formulate a 5-year irrigation development plan and for the Department of agriculture to formulate its agriculture resiliency program in order to significantly improve agriculture production in the coming years to strike a balance between infrastructure and agriculture growth.