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28 April 2022

Butuan Grand Palace Hotel

PRISCILLA R. SONIDO, CESO III

Regional Director


Introduction

Colleagues in government, partners from the private sector, friends from the media, ladies and gentlemen, good morning.

Our economic landscape dramatically changed in recent years due to the occurrence of the Coronavirus Disease 2019 (COVID-19) pandemic. The emergence of its various variants further challenged the Region’s outlook and saw new waves of lockdowns and protocols. Erratic weather disturbances, notably Typhoons Auring in February and Odette in December 2021, also impacted Caraga Region and its economy.  

Caraga Region’s poverty incidence among the population worsened from 35.2 percent in the first semester of 2018 to 38.3 percent in the first semester of 2021, which translated to 117,008 more Caraganons living in poverty. The imposition of stringent community quarantines due to the pandemic, which impacted economic activities, contributed to increased poverty incidence, among others.

Despite these challenges, the Region displayed adaptability and resilience by remaining steadfast in its recovery and development efforts.

Economic Performance

As reported by the Philippine Statistics Authority, Caraga Region’s 2021 gross regional domestic product or GRDP, at constant 2018 prices, expanded by 7.2 percent compared to the -6.9 percent adjusted growth rate in 2020. This growth performance was well within the Caraga Regional Development Plan (RDP) 2017-2022 Midterm Update’s forecast for 2021 of 7.0 percent to 7.6 percent. During this time, our Region’s economy grew faster by 1.5 percent than the Philippines’ 5.7 percent.  

Likewise, Caraga Region’s growth performance in 2021 is among the highest among regions in the Country, which signifies that we are on the right growth trajectory and on track in our economic recovery efforts and development interventions. Further, Caraga also ranks as the fifth fastest-growing economy nationwide and the second-fastest among the Mindanao Regions, just a bit behind the Bangsamoro Autonomous Region in Muslim Mindanao.

Prospects and Recommendations

Better management of COVID-19 has enabled Caraga Region’s economic landscape to improve in 2021 as evidenced by its expanded growth performance. Our economic gains serve as evidence that we are heading in the right direction. These are encouraging developments and with the continued positive outlook we could recover and further develop in the next years. This year, we are looking into sustaining our momentum towards economic recovery.

On March 21, 2022, the President signed Executive Order No. 166, Series of 2022, adopting the 10-point policy agenda to accelerate and sustain economic recovery in 2022 and beyond. The policy agenda involves 10 key strategies to accelerate and sustain economic recovery and strengthen the domestic economy against external shocks, including:

  1. Strengthening healthcare capacity;
  2. Accelerating and expanding the vaccination program;
  3. Further reopening the economy and expanding public transport capacity;
  4. Resuming face-to-face learning;
  5. Reducing restrictions on domestic travel and standardizing LGU requirements;
  6. Relaxing requirements for international travel;
  7. Accelerating digital transformation through legislative measures;
  8. Providing for enhanced and flexible emergency measures through legislation;
  9. Shifting the focus of decision-making and government reporting to more useful and empowering metrics; and
  10. Medium-term preparation for pandemic response.

The policy agenda focuses on the shift from a pandemic to a more endemic mindset, which means that the disease is still around but at a level where it is not causing significant disruptions in our daily lives. With this shift in mindset, we can build on our initial gains to minimize the long-term scarring effects of the pandemic and mitigate the impact of external shocks.

As we embark on our new development planning period (2023-2028), we in the National Economic and Development Authority have already identified key priority areas to improve productivity over the medium term, including:

  1. Smarter infrastructure;
  2. Regional equity;
  3. Innovation; and
  4. Climate change.

Moreover, the shift to lower COVID-19 alert levels throughout the Region will spur more business activity and allow people to join or rejoin the labor force and find work to earn and provide for themselves and their families. In Alert Level 1 or new normal, most capacity and travel restrictions have been lifted. For April 16-30, 2022, only Butuan City and Surigao del Sur are placed under Alert Level 1, all other provinces are still in Alert Level 2. Lowering alert levels will also improve the tourism industry via increased tourism arrivals and receipts. Hence, our Region should push for increased vaccination rates and booster shots administration in the Region.

The Region is moving closer to achieving the target of 80 percent of its population being fully vaccinated against COVID-19. As of April 24, 2022, Caraga reported a total of 1,564,099 fully vaccinated individuals which translated to about 68.99 percent of its population. However, the Region has low booster/additional doses administered reported at only 186,095. The rollout of the second booster shot started on April 25. Relative to this, the Region will ramp up the vaccination roll out and cover a broader eligible population by augmenting the medical personnel administering the vaccines, scheduling mobile vaccinations, and information and communication campaigns.

The May 2022 national and local elections will likely boost economic growth via election-related spending on printing and advertising, meetings and sorties, and other administrative expenses.

However, this may be canceled out by increased prices following the ongoing Ukraine-Russia conflict. The threat of escalation of the conflict may further result in a supply chain crisis and global inflation. Relative to this, the government is proactively monitoring the impact of the Ukraine-Russia conflict, particularly of the temporary inflationary pressures mostly due to elevated oil and commodity prices. The impact of rising prices is being addressed through the provision of fuel subsidies for farmers and fisherfolks, unconditional cash transfers to the poorest, and financial subsidies for public utility drivers.

Additionally, the Caraga Regional Tripartite Wages and Productivity Board is also currently conducting consultations throughout the Region on the proposed minimum wage adjustments. Raising the minimum wage would combat the impacts of inflation and improve the standard of living for minimum wage workers.

Ensuring the availability of accessible financing windows, especially among micro, small, and medium enterprises is also crucial in sustaining growth and in the recovery of the business sector.

Pursuant to the approval of the President, progressive expansion of face-to-face classes is now being implemented in both public and private schools in areas under Alert Levels 1 and 2. The resumption of face-to-face schooling will improve learning productivity and provide a boost to the economy via increased activity of establishments around schools.

The Region will also continuously ramp up infrastructure programs through the Build, Build, Build program given its strong multiplier effect. Timely implementation and completion of infrastructure projects will have a big impact on the Region’s recovery prospects. Among the top projects to be implemented by the Department of Public Works and Highways in 2022 include the Surigao-Davao Coastal Road with an approved budget of PhP1.18 billion; Agusan del Norte/Agusan del Sur North-South Lateral Road, La Paz – Loreto Section with an approved budget of PhP900 million; and Butuan City – Agusan del Norte Logistical Highway with an approved budget of PhP784 million. Additionally, the Port of Masao in Butuan City will commence its management and operation in May 2022.

Caraga Region secured a total of PhP67.73 billion funding allocation for programs, projects, and activities (PPAs) in the Fiscal Year (FY) 2022 General Appropriations Act. The Caraga Regional Development Council has also endorsed an estimated proposed budget of PhP153.36 billion for PPAs form implementation in FY 2023. The said PPAs are programmed for regional priority thrusts supporting the geographically-isolated, disadvantaged, and conflict-affected areas; Regional Recovery Program (RRP) from COVID-19; Balik Probinsya, Bagong Pag-Asa Program; capacity building for local government units on devolved functions; and Post-Typhoon Odette Regional RRP, among others.

The Region has also formulated the Post-Typhoon Odette Caraga RRP with PhP60.04 billion budgetary requirements for implementation from 2022-2028. We shall endeavor to follow through and monitor the funding of these projects for the recovery of the typhoon-affected areas and individuals.

Conclusion

Given the existing challenges and the reforms needed to boost the economy, the Region shall endeavor to put in place enabling factors such as a stable political landscape, low and stable inflation, and a robust financial sector that would shape and support its growth. To this end, the government shall strive to improve processes as well as environments to restore our growth potential and get back on a growth trajectory towards the realization of the AmBisyon Natin 2040.

The year 2022 is a crucial year as the Country will elect new leaders for the next three to six years at the local and national levels, respectively. This year also marks the formulation of the new national and regional development plans for the medium term following the end of the current planning period. The said plans will reflect the government’s socio-economic policies, strategies, and programs in support of and consistent with the development agenda of the new administration and are geared towards the attainment of development goals and objectives in the long-term development plan. The plan will also ensure that the goals of the Country and the Region are still relevant, responsive, and adaptive to the present context and applicable to its growing and evolving needs in the years to come. It shall serve as the overall guide in development planning for the next six years.

Borrowing the words of Socioeconomic Planning Secretary Karl Kendrick T. Chua, “Let us work together to take the Country to the next level of development.” Now, let us work together so that the Region’s economic progress shall translate to a matatag, maginhawa, at panatag na buhay for every Caraganon.

Thank you for coming and good day to all!

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