Has Mindanao’s economy thrived under martial law?

Published May 29, 2018, 12:05 AM

by Francine Ciasico

John Tria
John Tria





As martial law’s first anniversary comes upon Mindanao, questions about what it has brought the island quickly surface. Of course, there are the protests and accusations that challenge such measures. Yet after a year, and despite old and new threats from waning armed groups, Mindanao’s economy seems to have thrived.

The numbers tell an inspiring story. In a previous column, i wrote about the increase in the Gross Regional Domestic Product (GRDP) growth rate in three of the five Mindanao regions which exceeded the country’s 6.7% GDP in 2017.

In particular, and contrary to expectations, the Davao Region clocked 10.9 percent, and SOCCSKSARGEN, 8.2 percent. The welcome surprise was the Autonomous Region in Muslim Mindanao (ARMM), 7.3 percent, a turnaround from last years 0.4%. That these regions’ growth, taking place under martial law surpassed the country’s shows how economic resilience may be building up to overcome the old vulnerabilities.

These numbers accompany other firsts. Air connectivity has increased, with direct flights from Davao and Cagayan de Oro to several Visayan cities like Dumaguete, Tacloban and Kalibo and Kuala Lumpur all under martial law.

Tourism in Davao and Cagayan de Oro is at its most robust, with Davao particularly surpassing 2016 figures, hitting a record two million tourists, about 10 percent more than the previous year despite martial law. New hotels are coming up in both cities, to meet the demand for rooms due to numerous conventions and family tours.

Agricultural output remains strong as recent reports from the Department of Agriculture show slightly improved productivities in various commodities that cancel out previous declines, and challenge the thought that martial law gagged the Mindanao economy into a stupor. Nonetheless, more needs to be done to spur agriculture growth that will employ many of the rural poor, while keeping food prices in check.

Why these happen despite the Marawi conflict is a mystery to many. The numbers do not lie.

Moving forward, another possible good push for the economy will come from new investments. The possibility that reforms under TRAIN 2 will create special incentives that can draw more manufacturing and similar investments to Mindanao is gaining ground as the Department of Finance readies itself for discussion on this next round of tax reforms.

Over the last 30 years, the bulk of manufacturing investments were concentrated around Metro Manila, and creating, on average 2/3 of our GDP, and concentrating wealth and influence in the capital, luring millions in search of opportunity, while also creating traffic jams and urban blight.

That said, these old incentives have not spread these investments to areas like Mindanao. Perhaps it is time to enable other regions to grow industries at a similar pace. New rationalized incentives need to be designed to achieve that effect. As the economy is building a new resilience and keeps on growing, this is the best time to engage these reforms.

Even as these new incentives have yet to be implemented, both the Cagayan de Oro and Davao City Chambers of Commerce are reporting unprecedented interest from both local and foreign investors in the city, as they each have been hosting investment missions and trade visits over the last year. Both have invested time and effort to promote Mindanao as an investment destination, something that will reap long rewards in the near future.

Having mentioned these figures and trends leads many to question the statements of some quarters that martial law has brought suffering, paranoia and fear among Mindanao residents.

Perhaps the psychological programming against strong government in the post EDSA period has made many crowds cynical over strong state efforts to deal with threats. For many Mindanaowons, the negative reaction against martial law comes mainly from people who do not live on the island, who do not have the historical perspective on recurring conflict that they have.

This reality has grown an appreciation for strong measures to deal with debilitating violence. In Mindanao, strong state measures such as checkpoints in city entrances and exits are often welcomed by local residents, who worry that laxity in these measures may create openings for terrorists and traffickers to create violence.

In all, the improved economic numbers on the martial law anniversary may not exactly transform Mindanao into an economic power over night, but it ought to force deeper critical reflection on Mindanao’s reality, and how harnessing its now budding potential to lift the country will need a firm hand.


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