Message by MARGARITA R. SONGCO Deputy Director-General
Planning Workshop on the Updating of the Industry Cluster Roadmaps
Grand Regal Hotel, Lanang, Davao City
22 January 2014
Ladies and gentlemen, good morning.
It is a pleasure and a privilege to have this opportunity to join you in this industry cluster planning workshop. This event is part of our effort to scale-up the implementation of the Industry Clustering Strategy as one of the means to develop and strengthen key sectors, thus, contributing to the achievement of sustained and inclusive growth.
It has been our thrust to transform the economy from one that is consumption-driven to one that is increasingly investment-led and employment-oriented. This is one of the critical strategies outlined in the Updated Philippine Development Plan 2011-2016 aimed at sustaining, if not surpassing, our growth performance in the first three years of its implementation. In doing so, the revival of the manufacturing subsector along with the creation of new drivers of growth is deemed necessary.
The manufacturing subsector’s potential for innovation, value adding, and backward linkage with the agriculture sector – the main source of livelihood of the poor – is expected to drive the economy to a higher growth trajectory, create high-quality employment opportunities, and substantially reduce poverty.
This potential has been partly demonstrated when we reported the country’s Gross Domestic Product (GDP) in the first three quarters of 2013. During this period, the manufacturing subsector contributed 2.1 percentage points of the 7.4 percent GDP growth. Based on the latest Labor Force Survey in October 2013, it employed 3.1 million workers or about 8 percent of the country’s total employment.
These evidences of the manufacturing subsector’s contributions to the economy were further supported by the latest Monthly Integrated Survey of Selected Industries (MISSI). The MISSI shows that manufacturing output, measured by the Volume of Production Index (VoPI) and Value of Production Index (VaPI), increased by 21.3 percent and 16.2 percent, respectively in November 2013. The growth rate of VoPI for November 2013 is the highest since September 2010, while VaPI growth rate is highest since November 2012.
Looking at the Davao Region’s economic performance, the region posted a strong, better-than-expected growth of 7.4 percent in 2012, higher than the national average of 6.8 percent. This is due to the expansion in the services sector which contributed 53 percent to the region’s economy. The industry sector, which accounted for 29 percent of GRDP, grew much faster at 8.9 percent in 2012 from a 0.7 percent growth in 2011. This is mainly attributed to the surge in the manufacturing activities for processed food, beverages and fruits such as banana chips, coconut, among others. Manufacturing subsector expanded by 14 percent and contributed 1.4 percentage points of the 7.4 percent GRDP growth.
Given this, we see the need to maximize the manufacturing subsector’s potential in increasing its value added and contribution to inclusive growth. Critical constraints and support needed will be determined and addressed through various sectoral roadmaps prepared by the private sector in coordination with the Department of Trade and Industry.
These sectoral roadmaps will form part of the Manufacturing Industry Roadmap or the MIR that will then be integrated with the agriculture, services and other sectoral roadmaps. As a result, a Comprehensive National Industrial Strategy (CNIS) will be formulated, spelling out strategies in strengthening the link of these sectors with basic sectors as suppliers or markets as well as developing local industries to become more competitive in preparation for greater regional and global integration.
I am glad to note that, consistent with the Philippine Development Plan, the Updated Davao Regional Development Plan is pushing for the scaling-up of the implementation of the Industry Clustering Strategy for the priority industries in this region which include banana, mango, coconut, livestock and poultry, tourism, among others. Furthermore, the region is stepping up agro-industrialization by promoting efficient and well-developed value chains to encourage growth in agri-business and expand job opportunities.
In closing, the country’s economy has been touted as one of the fastest-growing economies in the region. While we are aware of this growth and take pride in the recognition given by the international community including credit rating agencies, we also acknowledge that we are yet to make this growth felt by every Filipino. As such, we will continue to find ways in accelerating the achievement of inclusive growth. I hope that this two-day event will serve as a venue in this effort by discussing and providing solutions to the different issues concerning the priority industries in this region.
I thank the organizer, RDC XI headed by Acting Chairperson, Regional Director Maria Lourdes Lim, for spearheading this activity.
To everyone, thank you and a pleasant day to all.
