DAVAO REGION'S ECONOMIC PERFORMANCE in 2007
AND DEVELOPMENT PROSPECTS FOR 2008

Introduction
Agricultural Production
Non-Agricultural Production
Foreign Trade
Investments
Employment
Inflation
Peace and Order
Development Programs and Projects
Development Outlook

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DAVAO REGION's ECONOMIC PERFORMANCE in 2007
AND DEVELOPMENT PROSPECTS FOR 2008

I. INTRODUCTION

Davao Region’s economy fared better in 2007 than in 2006. Overall agricultural production expanded and total exports grew by 10.5 percent. Annual inflation rate was kept down at roughly 3 percent, better than government’s target of 4 – 5 percent and the previous year’s record of almost 6 percent. Employment rate improved to 93.4 percent. The tourism industry remained vibrant as more tourists visited the region, pushing hotel occupancy rate higher by 6 percent. The minimum daily wages were increased that somehow cushioned the adverse impact of the increase in poverty threshold. The region also benefited from remittances of overseas Filipino workers. All these developments were achieved under an atmosphere of peace and quiet as threats of terrorism and insurgency were contained effectively and the incidence of common criminality further reduced.

The region is expected to sustain its growth momentum in 2008 due to its internal strengths and significant investment promotion initiatives last year, such as the BIMP Investment Conference held in Davao City, the Davao Trade Expo (DATE) 2007, and the region’s trade and investment mission to Saudi Arabia. The region’s economy will continue to bank on its rich natural resource base and an expected good weather condition conducive for agricultural production expansion. More private sector investments in key sectors, such as agriculture, construction, mining, business process outsourcing and telecommunications, power market development, property and housing development, and educational and other personal services are expected due to the region’s stable peace and order, continuing improvement of basic infrastructure support, good financial facilities, connectivity to the global markets, and a comparatively better skilled labor force.

National government support to regional development is expected to increase in terms of infrastructure support, credit facilities, and extension services, among others, in view of an improving fiscal position brought about by the strengthening peso and a projected stable inflation rate. The region’s development oriented local chief executives are anticipated to provide impetus to local government initiatives that will help drive the region’s economy. The region’s civil society, with its established strong networks, offers a reliable support to government in the delivery of basic services.

All these factors and efforts to sustain the region’s growth momentum will be undertaken within the framework of the national super region strategy for Mindanao as an agri-business center, the region’ s industry cluster strategy, and the 10-point agenda of the current national administration.

A higher growth rate of the region’s economy, however, may not be realized this year as this may be weighed down by the adverse effects of the economic slowdown in the United States, a major trading partner of the region; the undesirable consequences of the strengthening of the peso on the region’s agricultural export industry and peso incomes of OFWs; and the overall negative impact of rising oil prices.

II. AGRICULTURAL PRODUCTION

Crops

Most of the region’s major crops, except palay, coffee and cacao, yielded higher productions in 2007. Banana, the region’s main crop and export commodity, experienced higher production due to the expansion of cultivated areas and more bearing hills in Davao del Norte, Compostela Valley and Davao City. Other crops, such as abaca, sugarcane, pineapple, and papaya, also bore higher yields due to expansion in harvest areas. Other fruits like mango, durian and lanzones experienced abundant harvests as a result of more mature fruit bearing trees.

Corn, both the white and yellow varieties, continued to improve its yield as a result of improved technology. The contraction in corn harvest areas was countered by the increasing use of open pollinated variety (OPV) and hybrid corn seeds under the government’s corn program. Rubber production also expanded due to more tapped trees in Compostela Valley.

Coconut recovered in 2007 due to sufficient rains. The increase in coconut production was hardly affected by pest infestation that has perennially plagued the industry.

Palay output, however, dropped by 10.3 percent due to the reduction in harvest areas as many farmers shifted to the cultivation of bananas, vegetables and other crops. The drop in areas planted to rice was observed in all provinces. Yield per hectare, however, improved to 4.38 metric tons. Coffee and cacao production likewise dropped due to the shifting of some cultivated areas to banana.

Production of Major Agricultural Crops
Davao Region, 2006-2007 (in metric tons)

Source:  Bureau of Agricultural Statistics XI

Fisheries

The fisheries sub-sector improved its performance by almost 20 percent over the previous year. Production from commercial and municipal fishing got a boost from the establishment of more fish shelters (payaos) undertaken with the assistance of the Bureau of Fish and Aquatic Resources. Except for brackish water and oyster farming, other farming types of aquaculture experienced higher production in 2007.

Fisheries Output
Davao Region, 2006-2007 (in metric tons)

Source:  Bureau of Agricultural Statistics XI

Livestock and Poultry

The production of carabao, swine and goat improved in response to higher consumer demand and availability of livestock for breeding from sources. Cattle production, however, declined due to scarce supply from outside sources.

Production of the poultry industry, however, was adversely affected by the closure of some layer farms. There was also a corresponding decline in the production of chicken and duck eggs.

Poultry and Livestock Production
Davao Region, 2006-2007 (in metric tons)

Source:  Bureau of Agricultural Statistics XI

II. NON-AGRICULTURAL PRODUCTION

Tourism

The region continued to attract more tourists. In 2007, the number of visitor arrivals, as reflected in the region’s hotel occupancy rate, was 5.7 percent higher than the previous year. Tourist receipts amounted to P9.8 billion.

Hotel Occupancy
by Province/City, Davao Region, 2007

Source:  Department of Tourism XI

About 80 percent of the region’s tourists visited Davao City. The Island Garden City of Samal, which boasts of some of the region’s white beaches, cornered 5 percent of the region’s tourist market. The rest of the tourists took to the region’s provinces and other cities.

Around 44 percent of the tourists came to the region for business purposes. Those who attended conventions and conferences comprised 28 percent, while those who visited the region for holiday and pleasure accounted for 20 percent.

Approximately 92 percent of the region’s tourists were domestic travelers, 2 percent of whom were OFWs and balikbayans. The remaining 8 percent were foreigners, majority of whom were nationals of Japan, Korea, United States, China and Australia. The number of Korean tourists jumped tremendously, hitting almost 320 percent growth, as many of them came to the region to learn the English language. Koreans have also started to set-up small business in the region, particularly in Davao City. The number of Japanese visitors meanwhile declined by roughly 10 percent.

All these figures affirm the role of the region, particularly Davao City, as one of the country’s premier convention centers and a favored tourist destination.

Transportation

Air Travel

Domestic passenger traffic at the Davao International Airport in 2007 totaled 1,480,408, lower by 1.5 percent compared to the previous year. The number of international passengers, however, soared by 60.6 percent from 33,663 in 2006 to 53,856 in 2007. The increase in international passenger traffic was brought about by extensive tourism development and promotion, lower fare rates, and the opening of additional international flights plying the region. As of December 2007, there were 11 international flights per week bound for Inchon (Korea), Manado (Indonesia), Hong Kong and Singapore.

There was also a 9.6 percent increase in domestic cargo traffic, which reached 45.5 million tons in 2007. International cargo traffic reached 15,455 tons during the year.

Sea Travel

The number of ship calls at the region’s seaports declined by 20 percent from 32,000 in 2006 to 26,000 in 2007.  Cargo throughput, however, expanded by about 6 percent. Passenger traffic also improved by 2.1 percent reaching about 1.6 million during the year.  Domestic vessels comprised 93 percent of total ship calls.

Ship Calls and Cargo and Passenger Traffic
Davao Region’s Ports, 2006-2007

Source:  Philippine Ports Authority

Banking

As of June 2007, the region had 253 bank branches which comprised 137 universal and commercial banks, 28 thrift banks and 88 rural and cooperative banks.

Total assets of these banks were valued at P77.2 billion. Deposit liabilities amounted to over P68 billion, up by 2.5 percent over the December 2006 level. Deposits in universal and commercial banks accounted for 87 percent of total bank deposits, while the rest were in thrift banks (7 percent) and rural and cooperative banks (6 percent). The region’s net loan portfolio was P15.1 billion, which was 17 percent lower than the previous year.

Selected Banking Indicators
Davao Region, as of Dec 2006 and 2007

Source:  Bangko Sentral ng Pilipinas

III. FOREIGN TRADE

Exports

Export earnings of the region’s merchandise that were channeled through the Davao Port rose by almost 11 percent to US$ 720.4 million in 2007 from US$ 651.7 million the previous year. The increase in export earnings was achieved even with the decline in export volume to 2,716.5 metric tons in 2007 from 2,859.3 metric tons in 2006. This clearly indicates that the region was able to export more high value commodities that offset the expected lower peso incomes in the face of the peso’s appreciation against the US dollar.

The region’s top exports were raw and by-products of its major crops, namely, banana, pineapple, rubber, coconut, wood, tuna, and asparagus. Export earnings of products making up the region’s priority industry clusters accounted for 72 percent of the region’s total export earnings.

The fruit industry led the region in export earnings. Fresh bananas, banana flour and banana puree continued to dominate the region’s exports accounting for a 58 percent share despite a slight decline in their export value by 0.8 percent. Banana chips, which became part of the region’s top exports in recent years, earned US$ 33.2 million, posting a growth rate of 29 percent. Fresh and canned pineapple was the region’s second largest dollar earner reaching US$ 120.8 million or 17 percent of the region’s total export earnings. Pineapple export earnings grew by 145 percent. Fresh and processed mango, although not among the region’s top exports, grossed US$ 2.4 million last year.

Among industrial crops, rubber and coconut featured prominently among the region’s export earnings. Rubber earned US$ 42.2 million, around 2.5 percent lower than in its earnings in 2006 but still enough to place the product at third in the top ten exports of the region. Coconut by-products, such as activated carbon, charcoal, dust, and briquettes, raked in US$ 33.2 million, 15 percent higher than earnings in 2006. Desiccated coconut chip exports likewise enjoyed a bumper year, earning US$ 13.9 million, 56 percent higher than the previous year. Coconut acid oil, cake and liquor joined the region’s top export products in 2007 earning US$ 7 million but coco coir exports dropped to US$ 0.5 million.

For fishery products and vegetables, frozen tuna brought in US$ 7.3 million; seaweeds, although not among the top exports, earned US$ 1.2 million, and asparagus fetched US$ 6.1 million.

The wood industry banked on earnings from finished wood products which generated US$ 9.5 million in 2007, recording a hefty increase of 94 percent. The mining industry likewise brought in US$ 3.9 million from gold and chromite exports.

Top Ten Merchandise Exports
Davao Region, 2006-2007 (in million US$)

Source:  Department of Trade and Industry / Bureau of Customs

The region’s top export destinations in 2007 were the following:

1)   Japan - (banana and its by-products, mango, pineapple, coconut and its by products, asparagus, wood products, gold and chromite)
2)  China -(banana and its by-products, rubber, coconut and its by products, frozen tuna, gold and chromite)
3).  United States -(banana chips, desiccated coconut, frozen tuna)
4).  Korea – (banana and its by-products, mango, pineapple, coconut and its by products, gold and chromite)
5).  Germany – (banana and its by-products, frozen tuna)
6).  United Kingdom – ( banana and its by-products, desiccated coconut)
7).  Canada – (coconut by-products, seaweeds)
8).  New Zealand – (banana and its by-products, mango)
9).  Russia – (banana and its by-products, seaweeds)

Other export destinations included Hong Kong, Singapore, Thailand, Georgia, Iran, Malaysia, Australia, France, Italy, Brazil, Colombia, Switzerland, countries in the Middle East, and other European and African countries.

Imports

The value of the region’s merchandise imports in the first 3 quarters of 2007 reached US$290.2 million, higher by 10 percent over that of the previous year. Among its top import commodities were inputs for the manufacture of corrugated boxes and packaging materials for banana exports. Rice was also a major import. Other leading imports were major agricultural production inputs, such as fertilizers and fungicides. Among the leading sources of the region’s imports were USA, China, Vietnam, Thailand, Korea, Malaysia, Finland, New Zealand, Indonesia and Japan.

Top Ten Merchandise Imports
Davao Region, 2006-2007 (in million US$)

Source:  National Statistics Office

IV. INVESTMENTS

The confidence of investors in the region’s economy was high as the Securities and Exchange Commission (SEC) reported P289 million in new investments in 2007, about 89 percent higher than the level registered in 2006. Paid-up capital of newly-registered corporations accounted for 80 percent, while contributions of partnerships provided 20 percent. The SEC-registered number of stock corporations and partnerships also rose by almost 7 percent.

Per records of the Board of Investments (BOI), investors also committed a total of P4.9 billion for the region from January to November 2007, approximately 104 percent higher than that of the previous year. The commitments were for projects for mass housing (P81.1M), fruit processing (P52M), activated carbon (P10.7M), virgin coconut oil (P7.5M), coco coir peat (P4.7M), wood processing (P6M), upland banana plantation (P1B) and hydropower (P3.7B). The hydropower project will be located in Calinan, Davao City and was the largest investor commitment during the last 3 years for Davao Region. Investor commitment for mass housing meanwhile is 74 percent higher compared to the 2006 figure.

List and Value of Investment Commitments
Davao Region, as of November 2007

Source:  Board of Investments

The region likewise received more foreign direct investments (FDIs) in 2007.  FDIs reached P45.696 million, 143 percent more than the previous year’s level.  The sharp increase in FDIs was due to the revitalization of the mining and quarrying industry in the region.  The entire Industry sector, meanwhile, received P31.2 million or 68 percent of the FDIs.  The Services sector got P14.3 million or 31.3 percent of the total FDIs, and the Agriculture, Fishery and Forestry sector took P215 thousand or 0.47 percent of the total FDIs.

Foreign Direct Investment
by Newly Registered Corporations and Partnerships
Davao Region, 2007

Source:  Securities and Exchange Commission

V. EMPLOYMENT

As of July 2007, the region had about 1.8 million workers out of its estimated 2.7 million population aged 15 years old and over of 2.7 million. This translates to a labor force participation rate of 66 percent. The region’s employment rate improved to 93.4 percent from the 92.9 percent recorded for the same period in 2006.

Almost 90 percent of the region’s workers were employed either by the Services sector or the Agriculture, Fishery and Forestry (AFF) sector. Both sectors had an almost even share of the region’s total employment with the Services sector absorbing 45 percent and the AFF sector taking 44 percent. Industry, on the other hand, employed 11 percent. Workers in the Services sector were mostly in wholesale and retail trade (38%) followed by transportation, communications and storage (15%). AFF workers were mostly in agriculture, hunting and forestry (95%). Industry workers were mostly engaged in manufacturing activities (45%).

Labor and Employment Statistics
Davao Region, July 2007

Source:  NSO Labor Force Survey

Top occupation groups were laborers and skilled workers (39%), farmers, foresters and fishermen (20%) and officials of government and special interest organizations (10%). Half of the employed were wage and salary workers in both government and private institutions, while the other half were own account and unpaid family workers.

The Department of Labor and Employment (DOLE) XI reported that during the first semester, 331 workers were adversely affected by the closure of 8 establishments in the region due to economic reasons. Moreover, about 1,548 workers were laid off during the period. The number of laid-off workers was 65 percent higher than the figure in 2006.

Nonetheless, government continued to pursue its commitment to provide employment. Through DOLE XI assistance, about 34,000 job seekers in 2007 found employment. Government did not only assist in the placement of workers but also provided career guidance and pre-employment seminars.

The region’s latest minimum daily wage increased by P10 in 2007. In the cities, agricultural plantation workers now receive P240.00, while non-agricultural workers employing more than 10 workers take P250.00. Workers in the provinces receive P2.00 less than their counterparts in the cities.

Daily Minimum Wage Rates
Davao Region, (Effective July 2007)

      Source: National Wages and Productivity Council

VI. INFLATION

The region’s average inflation rate in 2007 slowed down to 2.9 percent from 5.9 percent the previous year. This was brought about by slower growths in the prices of basic goods and services. The region’s inflation was slightly higher than the national average of 2.8 percent but lower than government’s target of 4.0 - 5.0 percent for the year.

By commodity group, Food, Beverage and Tobacco posted the highest inflation at 3.8 percent. Some food items that registered significant price increases were chicken, flour and dairy products. Housing and Repairs posted the lowest price growth at 1.2 percent. Services posted a low inflation as the cost of education, medical and transportation, even under the face of rising oil prices, did not move up significantly within the period.

Average Inflation Rate by Commodity Group
Davao Region, 2007

      Source:  National Statistics Office

Average Monthly Inflation Rate, All Items
Davao Region, 2006 and 2007 (in percent)

The highest inflation was recorded in December at 4.7 percent, while the lowest was in August at 2.1 percent. This was due to increased demand for food items during the holiday season and price hikes in liquefied petroleum gas, kerosene and charcoal. Davao del Sur and Davao del Norte (including Compostela Valley) registered the highest inflation rate at 3.5 percent. Davao City, on the other hand, posted the lowest rate of 2.2 percent. Davao Oriental’s inflation rate was 3.2 percent.

The slow rise in inflation has also slightly reduced the purchasing power of the peso in the region. One peso in year 2000 was worth P0.68 in 2007, down from P0.71 in 2006.

VII. PEACE AND ORDER SITUATION

The region continued to enjoy a relatively stable peace and order in 2007. Disturbances to the region’s peace and order have been limited to common criminality. Terrorism threats have been repelled by the aggressive posture of local government units, the national police, and the military. The insurgency problem has also been effectively contained as government became more focused in its development assistance through the Kapit Bisig Laban sa Kahirapan (KALAHI) program, among others, to the remaining communities in the region affected by armed conflict.

Common criminality was likewise reduced to a minor hindrance to regional development. The national police reported that total crime volume in the region declined by 4.6 percent as the volume of index crimes slid by 16 percent. Non-index crimes dropped but not as much at 8 percent. Except Compostela Valley, the other provinces of the region and Davao City reported reduced crime volume. The incidence of criminality is usually higher among the urban centers as almost half of the total number of crimes in the region were committed in Davao City. Davao del Norte, which has 3 cities, accounted for the next largest share of the region’s crime volume at 20 percent.

Total Crime Volume
by Province/City, Davao Region, 2006-2007

Source:  Philippine National Police

The region’s average monthly crime rate in 2007 fell to 7.55 from 7.92 per 100,000 population in 2006 but Davao City had a higher average monthly crime rate at 9.45 per 100,000 population Crime solution efficiency, however, was still running at around 86 percent in 2007, almost the same level as the previous year.

Crime Solution Efficiency Rate
 by Province/City, Davao Region. 2006-2007

Source:  Philippine National Police

VIII. DEVELOPMENT PROGRAMS AND PROJECTS

The overall better performance of the region’s economy in 2007 was achieved with the support of additional public investments that resulted to the implementation of key development programs and projects.

A total of 1,121 nationally-funded infrastructure projects worth 2.3 billion pesos were completed in the region in 2007. Road improvement and rehabilitation accounted for the largest share in project investments at P691.8 million. The rest of completed nationally-funded projects in the region are the following:

Source: Regional Project Monitoring Committee

Aside from the regular programs and projects of national and local governments that provided critical support to socio-economic development, capital formation and improvement of governance, a total of 114 infrastructure projects that were funded by Official Development Assistance or ODA were also completed in the region in 2007. These projects cost 2.2 billion pesos. These included roads and bridges, irrigation systems, market and transport terminals, classrooms and school buildings, among others.

These projects provided critical support to increasing the region’s agricultural production, as well as efforts in poverty alleviation. The biggest was the rehabilitation of the Monkayo-Tagum road section, costing about P1.5 billion.

Source: Regional Project Monitoring Committee

DEVELOPMENT OUTLOOK

Davao Region is likely to grow at a moderate rate in 2008 but will be able to withstand the adverse effects of a possible recession in the United States, one of its major trading partners; the expected further strengthening of the Philippine peso; and the volatility of oil prices in the world market. Several positive factors could outweigh the negative factors and sustain the region’s growth momentum. These factors include an expected good weather condition, rich natural resource base, stable peace and order, continuing improvement of basic infrastructure support, good financial facilities, connectivity to the global markets, high investor confidence, an aggressive private sector, development oriented local chief executives, established networks of civil society, and a comparatively better skilled labor force.

Upsides

Agricultural production will get a boost from good weather conditions and government support
Expected good weather condition for the rest of the year would likely boost production of crops, livestock and fisheries. The government can further sustain its support to the growth of the Agriculture, Fishery and Forestry sector through infrastructure, technology and extension services, post-harvest and storage facilities, accessibility to rural credit, market expansion for agricultural products, area expansion and distribution of high-yielding variety seeds. Lower import costs of inputs due to the peso appreciation, and the utilization of better technology could encourage more production. Davao Region’s crops, such as bananas are well protected from extreme weather disturbances and should encourage producers to expand.

Rich natural resources shall allow production expansion
The region’s rich agricultural lands, forest resources, fishery grounds, and mining areas can still allow more production and ultimately provide more than ample opportunities for income growth. Further, improved utilization of the region’s rich natural resources, such as land, in the long run is expected to get a boost from the proactive stance of the region’s local chief executives to adopt a development strategy marrying development and physical planning.

Investor confidence to remain high
Investors’ confidence in the region’s ability to provide reasonable returns will remain high. The past year saw investment commitments running 60 percent higher than the previous year and investors have good reasons to pour their money in the region: a stable peace and order, good financial facilities with connectivity to world markets; improving infrastructure facilities for travel in and out and within the region; increased frequency for air travel, among others.

More foreign direct investments in the mining industry
The mining industry is expected to grow as more foreign direct investment inflows for the industry were received and are expected to continue in the future. The industry will likewise benefit from various on-going government initiated infrastructure support projects, such as construction and improvement of road networks leading to and from the mining sites.

Construction industry likely to enjoy a banner year
The construction industry will likely enjoy a banner year with the foreseen better fiscal resources of government for infrastructure support. Possible infrastructure investments in the region include those that will be established to support expansion agricultural areas; those that improve accessibility within the region and to areas outside the region, and those identified under the Comprehensive Infrastructure Investment Program for the Super Region strategy. Davao Region is part of the Mindanao Agribusiness Super Region. The national government through the Home Mutual Development Fund has also allocated P30 billion this year for housing and has initiated efforts to fast track the implementation of housing projects.

Inflation likely to remain manageable
The prices of basic commodities in the region that experienced upward spikes towards the end of 2007 are expected to settle to a stable level as demand returns to normal after the frenzied Christmas spending. Oil prices will eventually taper down as high prices and the onset of spring would slow demand of world economies highly dependent on foreign oil sources. Government’s lowering of oil tariffs will also help stabilize oil prices. With the peso likely to remain strong in the next few months and commodity supply remaining stable, prices of basic commodities are going to rise slowly.

High employment rates in agribusiness, mining and construction ventures
With expected expansion of agriculture production and processing, mining activities, and construction, employment in these sectors are likely to remain high in 2008.

Downsides

Possibility of investment postponement
While local conditions tend to boost investor confidence, rising agitation in the national political scene could make them withhold their investments until a more stable political climate emerges.

Lower export incomes
The export industry of the region would be facing rough times if oil prices will not drop and the peso continues to appreciate. Export companies with fixed marketing agreements would be badly hit by this scenario. Local business process outsourcing companies are expected to continue to feel the heat of the strong peso as their income in dollar terms would have lower peso values. Unless local BPOs can strike new marketing agreements at higher prices, maintaining the current manpower level in the call centers may be difficult to sustain.

Region’s promising sectors in 2008

Agribusiness (especially high value commercial crops)
The national government strategy identifying Mindanao as a super region for agri-business and the comparative advantage of the region in agriculture, fishery and forestry make agribusiness a sector worth investing in 2008. The region also continues to possess a large human resource that could support agribusiness ventures. Further, government’s thrust to promote entrepreneurship should be taken advantage by the region. While crop production and handicraft-making are the staple ventures in rural areas, it is important that farmers aim for higher value products. The recent popularity of banana chips in the world market strengthens this strategy. Banana jam is another segment that has the potential to achieve the same level of popularity.

The United States Department of Agriculture has also assured the Philippines that it would speed up the process of pest risk analysis for Philippine bananas—a move that is expected to boost the country’s export earnings. This can also send a positive signal to small farmers to diversify into high value crop production. Government is opening up more markets for bananas and other high-value commercial crops (HVCCs), which contribute significantly to the country’s agro-fishery export earnings, through selling and trade missions in major markets like China and Japan and emerging markets in Europe and Asia.

Coconut farmers should strive beyond the production of copra, desiccated coconut, coco coir, briquettes and charcoal. They could diversify to the production of coconut by-products that can be used as natural health supplement and as cosmetics, such as soaps, massage ointments and aromatherapy oils.

Processing of mangoes and other fruits is a venture that needs to be further promoted given an established and expanding foreign market.

ICT/Telecommunications
The telecommunications sector continues to be a promising investment area. Business process outsourcing, such as call centers and medical transcription services, have become important contributors to the local economy. The expansion of call centers outside Metro Manila is expected to continue despite the peso appreciation because of high global demand and availability of skilled and relatively cheaper human resources. The number of subscriptions to cellular phone and internet services is also growing and would continue to be so this year and the years beyond.

The telecommunications sector continues to be a promising investment area. Business process outsourcing, such as call centers and medical transcription services, have become important contributors to the local economy. The expansion of call centers outside Metro Manila is expected to continue despite the peso appreciation because of high global demand and availability of skilled and relatively cheaper human resources. The number of subscriptions to cellular phone and internet services is also growing and would continue to be so this year and the years beyond.

Information and communication technology (ICT) has now permeated business and government operations in the rural areas. As the regional economy is further drawn into the global economy, the demand for ICT is likely to expand. As part of its nationwide reach, the Cyber Corridor Super Region Strategy likewise covers Davao City, which now carries the monicker Silicon Gulf.

Tourism development
The increase in flight frequencies to and from the region, the offers of discounted air fares of competing airlines, and the non-increase in land and sea fares, together with improving transportation and other support facilities make the tourism industry in the region a bright prospect for investment. The continuing rise in visitor arrivals and hotel occupancy rates despite the peso appreciation provides proof to the potential of investing in the industry.

Property and housing development
Property development, particularly through mass housing, is likely to be intensified this year particularly with the huge fund allocation for housing by government and its efforts to fast track the processing of business permits and licenses of qualified developers. Despite their expected lower peso incomes due to the peso appreciation, the OFW families as a property and housing market remain a good prospect.

Unless their supply remains stable, construction materials will not likely experience huge price increases this year. In addition, more government construction projects, especially those under the Super Region strategy, regular national and local infrastructure programs have been lined up for implementation this year. Hence, the construction industry is in for another profitable year.

Mining and Wood
The value of the region’s gold mineral deposits is estimated to run to billions of US dollars and as such the mining industry will always be a rewarding prospect. Products of the region’s wood industry, particularly furniture, are likewise getting favorable demand from the global market.

Medical and English language education
The high enrolment in nursing education in the region is likely to continue this year despite fears of a US recession. The demand for educational supplies and equipment for such courses would also be expected to run high.

The demand for English language training from non-English speaking foreign nationals like the Koreans is likely to continue. The growing need for call center agents in the region likewise has created a substantial demand for services offering English proficiency lessons.

Power market development
The growing power consumption demand in the region indicates a pressing need for power supply investments this year. A hydropower supply project is being completed in Davao del Sur and another one is expected to be established this year in Davao City. Additional investments for such projects are needed, particulary to serve the power needs of the urban centers and rural communities of the provinces of Davao del Norte, Compostela Valley and Davao Oriental.

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Downloadable Documents

Medium-Term Philippine Development Plan, 2004-2010
Socio-Economic Report 2006
Human Development Report 2006

NEDA XI documents

Regional Development Plan 2004-2010

RDC Resolution No. 47, Approving the DRDP
Table of Contents
Message from the President
Message from the Secretary of Socio-Economic Planning
Foreword by the RDC XI Chair
Preface by the RDC XI Vice-Chair
List of Acronyms
Chapter 1 Executive Summary
Chapter 2 Increased Job Creation through Economic Growth
Chapter 3 Enhanced Social Development with Direct Poverty Reduction Measures
Chapter 4 Improved Physical Planning and Sustainable Management of the Environment
Chapter 5 Improved Infrastructure and Logistics Support
Chapter 6 Good Governance

Regional Development Report 2005

RDR 2005 Cover
Table of Contents and Foreword
Chapter 1-General Economic Performance
Chapter 2-Human Development
Chapter 3-Agri-Industrial Development
Chapter 4-Infrastructure Development
Chapter 5-Governance and Development Administration
Annex A
Annex B

 

The Millenium Development Goals
FIRST DAVAO REGIONAL PROGRESS REPORT

Linking Project Study to Investment Programming and Budgeting
The Davao Region Success Story

Presentations

The Davao Regional Development Plan, 2004-2010

The Regional Physical and Framework Plan of Davao Region, 2003-2030

The RDC Briefer

Speeches

Message delivered by Regional Director Nicasio Angelo J. Agustin of NEDA Regional Office XI during the Convocation of the Provincial Government of Davao del Norte at the Bulwagan, Provincial Capitol, Tagum City, Davao del Norte.| July 14, 2008

Message of Socio-Economic Planning Secretary and NEDA Director-General Romulo L. Neri, delivered by Dr. Nicasio Angelo J. Agustin during the Closing Program of the Launching of the SUD Book Series and Recognition Program | July 11, 2007

Director Agustin's Speech during the Launching of the project Mechanization of Mud Press-based Organic Fertilizer Production | July 3, 2007|

Director Agustin's Speech during the Launching of the Cacao/Cocoa Processing Project | Jule 18, 2007

Director Agustin's speech during the MRSC turn-over Ceremony | June 26, 2007

ARD Uy's opening remarks during the JDS Briefing | August 23, 2007