Business & Economy

In Cordi, it’s time to stop relying on electronics

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BAGUIO CITY -- The Cordillera may need to let go of its reliance on semiconductor and electronics exports, which failed to slow down its economic decline in 2016.

The region’s gross regional domestic product (GRDP) dropped to a 2.1-percent growth rate last year, compared to the revised 2015 growth rate of 4 percent, the Philippine Statistics Authority (PSA) said last week.

The region’s growth rate has been erratic since 2011, when the region posted a 1.5-percent GRDP, which led to a further slump of 0.5 percent in 2012.

The region performed better in 2013 with a 5.4-percent growth rate, only to see it decline to 3.3 percent in 2014, rise again in 2015 and then plummet in 2016.

This time, government statisticians attributed the slow Cordillera growth to the poor performance of private construction projects in upland provinces.

Although public infrastructure investments were high last year, construction activities slowed down based on the volume of business permits issued and expenditure reports submitted by various agencies, said Aldrin Bahit Jr., acting chief of the PSA statistical operations and coordination division in Cordillera.

But growth in the manufacturing sector also dropped from 4.4 percent in 2015 to 3.8 percent in 2016, said Villafe Alibuyog, PSA Cordillera director.

She described manufacturing as the biggest growth contributor to the Cordillera’s industry sector.

More than half of the region’s economic growth are due to manufacturing but electronics and semiconductor firms, which operate in the Baguio City Economic Zone, have been suffering poor demand since 2014.

 

Diversify growth areas

“We need to diversify our sources of growth in the industry sector. We cannot just rely on our traditional high-value electronics exports that also make us vulnerable to the realities of global decline,” said Jedidia Aquino, assistant Cordillera director of the National Economic Development Authority.

The new growth driver for the region appeared to be the services sector, owing to the positive impact of tourism, education and business process outsourcing on the regional economy, Aquino said.

The growth rate of services sector, however, dropped from 6.8 percent in 2015 to 6.5 percent in 2016.

Agriculture remained the ailing sector of the regional economy, which contracted further to a negative 4.7-percent growth rate in 2016, from a negative 4.1 percent in 2015.

Farming continued to fall victim to calamities triggered by extreme weather, although Benguet province and parts of Mt. Province and Ifugao province remained the principal sources of salad vegetables like carrots, cabbages and lettuce, the Department of Agriculture said. - VINCENT CABREZA/Inquirer.net

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