BAGUIO CITY – The city government is crafting an economic continuity plan to help cushion the impact of soaring oil prices on various sectors, Mayor Benjamin Magalong said Tuesday.

“The plan aims to address identified risks and outline solutions for each of the affected sectors to help sustain economic activity amid the downturn,” he said in a media interview.

He said the plan will include measures to prevent a slump in the services and tourism sectors, which are among the city's main revenue sources.

“We are finalizing. We have declared a state of calamity so that we can access the quick response fund and assist the most affected sectors as an immediate response, but long-term plans and responses are currently in the pipeline,” he added.

The city government is bracing for a decrease in tourist arrivals due to an economic slowdown as a result of fuel price volatility triggered by the continuing Middle East conflict.

"As we navigate the economic challenges ahead, we remain hopeful that proactive measures and collaboration among sectors will help cushion the impact on the city’s economy," the mayor said.

Citing data from the Baguio Tourism Council, he said tourist arrivals have dropped by as much as 40 to 50 percent in recent weeks.

Accommodation facilities in the city have also experienced a general decrease in occupancy rates by 40 to 50 percent, reflecting the broader slowdown in visitor activity.

Hotels like those in Camp John Hay were full on Thursday and Friday, but only 60 percent full on Saturday, showing a slowdown in local tourism.

The Hotel Restaurant Association of Baguio has said before the Holy Week, accommodation establishments saw a drop in reservations.

The downturn is already affecting the local economy, with projections indicating that tourist arrivals could fall further – possibly by as much as 60 percent in the coming weeks.

“This decline is expected to impact revenues, which may be reflected in next year’s financial performance," he added.

The official also said economic indicators show a downtrend, from 5.6 percent last year to 4.4 percent this year, with projections suggesting it could dip below three percent in the first quarter.

"This is why we need to adopt new strategies to stimulate economic activity, particularly to support micro, small, and medium enterprises (MSMEs), which are among the most affected sectors," the mayor said.

“Baguio is service and tourism-based. We need a lot of economic activity, so we are looking at opportunities, some silver linings,” he said.

He also encouraged potential visitors to take advantage of the current lack of crowds and faster travel due to eased traffic congestion.

Magalong assured the public that the city remains ready to welcome guests, with efforts in place to maintain safety, cleanliness, and a pleasant experience for all.

"As Baguio faces economic challenges brought by reduced tourist arrivals, we remain optimistic that travelers can help support local enterprises while having a more enjoyable and stress-free visit," he said.