Is Mindanao ready for the ASEAN Economic Community in 2015?

DAVAO  CITY (MindaNews/09 August) — Take away Mindanao from the Philippine equation and the country’s agricultural production will drastically plummet.

Last year, Mindanao earned at least $3 billion from agricultural exports, accounting for 60 percent of the country’s total agricultural exports, data from the Mindanao Development Authority (MinDA) showed.

The total exports of the island, including non-agriculture based commodities grew by 16.7 percent with a value of $4.187 billion in 2012 from $3.588 billion in 2011.

The 16.7 export growth in Mindanao is more than double the country’s 7.6 percent increase in exports last year.

Mindanao’s top 10 export markets are the United States of America, Japan, China, Netherlands, South Korea, Singapore, Switzerland, United Kingdom, Germany and Malaysia.

“We should be proud to be Mindanawons because we’re rich. The potentials of Mindanao are far larger than any place in the entire Philippines,” said businessman John Gaisano Jr., referring to the vast fertile lands, bountiful seas and massive mineral wealth lying in the island.

Gaisano says he firmly believes that Mindanao can grow big time sooner with proper directions set into motion by both the public and the private sectors.

This year, Gaisano is overseeing a major event to address what has not been done and what could be done for Mindanao.

Charting Mindanao’s direction

Now on its 22nd year, the Mindanao Business Conference (MinBizCon), the largest annual gathering of government and business leaders and members of chambers of commerce in the island, takes centerstage once again on August 8 to 10 at the SMX Convention Center here with the theme “Moving Towards ASEAN Business Integration.”

The MinBizCon is an initiative of the Philippine Chamber of Commerce and Industry (PCCI).

As MinBizCon 2013 conference director, Gaisano has been pulling the strings to make the best out of the conference that was first held in this city in 1992.

MinBizCon 2013 was supposed to have been hosted by Ozamiz City but it backed out and the hosting was eventually accepted by the Davao City Chamber of Commerce and Industry, Inc. (DCCCII), on short notice.

“This conference will pave the way for a better Mindanao. It will be very different from the past conferences because we made sure that “it’s the output of Mindanawons, by Mindanawons and for Mindanawons,” Gaisano, also a DCCCII trustee, told MindaNews on July 29.

With just a few months preparation, Gaisano said they were able to build a powerhouse cast of speakers never before assembled in the history of the MinBizCons.

Aside from President Benigno Simeon Aquino III,  the major speaker for  MinBizCon 2013, 14 Cabinet secretaries and senior government officials, as of the July 30 program, were slated to address the most pressing issues affecting the business sector in the island.

The issues they will address are based on the five regional consultations  MinBizCon 2013 organizers conducted a few months ago, Gaisano said.

Mindanao, the second largest island in the Philippines, comprises 26 provinces, 33 cities, 422 towns and six regions:  9 (Zamboanga Peninsula), 10 (Northern Mindanao),  11 (Davao), 12 (Southwestern Mindanao, also known as Soccsksargen),  Region 13 (Caraga) Region) and the Autonomous Region in Muslim Mindanao.

Based on the regional consultations attended by at least 250 local business and industry leaders, organizers of the MinBizCon 2013 crafted an eight-point policy agenda for submission to the President.

These issues include Agriculture, Power, Tourism, Transport and logistics, Skills development, Small and Medium Enterprises, Information and Communications Technology,  and Mining.

“It is imperative for the national government to address those concerns because if provided the support, it will not only help the poor but propel the economy of Mindanao to greater heights,” Gaisano said.

Not a war zone

Surprisingly, the eight-point policy agenda of the MinBizCon 2013 did not include the peace process between the government and the Moro Islamic Liberation Front (MILF), which is gaining positive strides such as the signing of the Framework Agreement on the Bangsamoro (FAB),  two of the four required annexes, and a ceasefire that has been holding in the last five years.

Signed on October 15 last year, the FAB  serves as the framework for the comprehensive peace agreement between the government and the MILF, the largest Moro armed group fighting for self-determination in the last few decades.

Under the FAB, both parties agreed to work for the creation of a new autonomous political entity that would replace the Autonomous Region in Muslim Mindanao (ARMM) by 30 June 2016.

Mindanao also hosts the biggest concentration of the New Peoples’ Army (NPA) in the country,  in the Caraga and Davao regions.

Gaisano explained that while peace continues to be a concern for the business sector, it is not the only problem of Mindanao and the conflict is just contained in certain pockets of the island— away from the big economic and industrial hubs such as the cities of Davao, Cagayan de Oro, General Santos and other booming localities.

“Mindanao is not a war zone. It is generally safe to live in most parts of the island and park your investments here,” he stressed.

He appealed to the media to be more circumspect when reporting on conflict and not to make it appear that the whole island is under fire.

Organizers are expecting at least 1,000 local and foreign participants to the conference here.

Gaisano said that through MinBizCon 2013, participants and the larger public “will be given a good perspective of what’s happening in Mindanao.”

Ricardo Juliano, MinBizCon 2013 conference chair, stressed that the event is so important that instead of resolutions passed on to the President and Cabinet secretaries at the end of the conference, they will now present an  eight-point Mindanao business policy agenda.

He noted that the policy agenda will be tracked if government acts on them, through the Mindanao Development Authority (MinDA), a state agency created to integrate peace and development initiatives in the island.

Wider opportunities

Juliano, also PCCI vice president for Mindanao, said the conference will help Mindanao prepare for a bigger market and opportunities that will arise as a result of the looming integration of ASEAN economies.

According to the ASEAN website, the ASEAN Economic Community (AEC) that will integrate the economies of the 10-member states will “transform ASEAN into a region with free movement of goods, services, investment, skilled labor, and freer flow of capital.”

The member-countries of the Association of Southeast Asian Nations (ASEAN) are Brunei Darussalam, Cambodia, Indonesia, Lao People’s Democratic Republic, Malaysia, Myanmar, Philippines, Singapore, Thailand and Viet Nam.

In anticipation of the ASEAN economic integration, conference organizers adopted the theme “Moving Towards ASEAN Business Integration.”

In simple terms, the ASEAN “will become one big single market and production base,” Juliano explained.

The integration also seeks to make the ASEAN “a highly competitive economic region, a region of equitable economic development and a region fully integrated into the global economy.”

The AEC areas of cooperation include human resources development and capacity building; recognition of professional qualifications; closer consultation on macroeconomic and financial policies; trade financing measures; enhanced infrastructure and communications connectivity; development of electronic transactions through e-ASEAN; integrating industries across the region to promote regional sourcing; and enhancing private sector involvement for the building of the AEC.

In short, the AEC will transform ASEAN into a region with free movement of goods, services, investment, skilled labor, and freer flow of capital, according to the group’s website.

“The ASEAN economic integration is an opportunity to be a lot better and for Mindanao particularly, it is an opportunity to shine,” Juliano told MindaNews in a separate interview in General Santos City on July 30.

He recalled that in olden times, Mindanao “was the front door of the country” in terms of trading because of the island’s proximity with neighboring Muslim-dominated countries, particularly citing the Royal Sultanates in mainland Mindanao back then as effective political and economic power houses.

The Philippines is a member of the nearly two-decade BIMP-EAGA (East ASEAN Growth Area) comprising Brunei, East Indonesia, East Malaysia and the Philippines’ Mindanao and Palawan.

For the looming integration of ASEAN economies, Juliano cited that Mindanao has competitive edge with its still vast fertile lands, tourism spots and geographically closer locations to some countries in the ASEAN region like the Muslim dominated Indonesia, Malaysia and Brunei.

600-M ASEAN population as market

It is also a good opportunity for Mindanao’s food manufacturing sector to capture a bigger market by focusing on halal production, Juliano noted.

With at least 600 million ASEAN population and half of that Muslims, our manufacturers should consider the halal industry, which also includes non-food products, as a considerable moneymaking mill, Juliano said.

Both Juliano and Gaisano agreed that there’s a need to prepare and a lot work to do for Mindanao to fully take advantage of the vast opportunities that the ASEAN economic integration offers.

Among these  are better farm-to-market roads, stabilizing the island’s power situation (see separate story), easier access to financing for MSMEs, skills improvement of workers, and improving other infrastructures necessary to attract investments to the island.

“Let’s finally get all our act together now to bring Mindanao to further greater heights,” Gaisano said (Bong Sarmiento/ MindaNews)

[This piece was first published in the August 8, 2013 issue of OUR Mindanao newsmagazine[