By Julito G. Rada Posted on Jun. 19, 2013 at 12:01am
Inadequate power supply will remain a major problem that could stall regional growth, the Bangko Sentral ng Pilipinas said in a new report.
“Going forward, a major challenge that could hamper regional development, particularly in Mindanao, is the lack of adequate supply of electricity that threatens various economic activities,” the central bank said in its latest “2012 Report on Regional Economic Developments.”
It said the presence of different crop and livestock diseases and infestations in the regions also posed risks to the country’s food self-sufficiency plan and the livelihood of agriculture-dependent communities.
It said extreme weather conditions as a result of climate change was a significant issue in the regions, especially those that are heavily reliant on agriculture.
It said, though, that regional development was expected to benefit from the government’s various infrastructure improvement and development programs.
“Tourism will remain a key factor in regional economic activity. Hotel and resort constructions and expansions, as well as improved transportation services are expected to boost further the tourism industry across the regions,” the report said.
It also cited the earlier projection of the Philippine Constructors Association that the growth of the construction industry would accelerate to 8 percent this year on the back of sustained low inflation and interest rates.
“The surge in public construction investment in 2012, which was supported by the government’s increased infrastructure expenditures, provided momentum to the industry for 2013,” the report said.
It said the expansion of the business process outsourcing industry, sustained increase in emerging industries, remittances and the public-private partnership program would help propel the growth of the construction sector.
The report attributed the increase in private construction projects to higher demand for real estate and housing by migrant Filipino workers, as well as expansions in tourism and business establishments.
“An uptick in the number of approved building permits were seen in Calabarzon, Central Luzon, Northern Mindanao, Zamboanga Peninsula, Central Mindanao and Bicol. Higher residential building construction starts were also observed in most of these regions,” it said.
The report noted that the National Capital Region, in terms of bank service availability as of end-December 2012, had the highest number of banks relative to the total number of cities/municipalities under its jurisdiction with a density ratio of 176.06.
Following the NCR were Calabarzon and Central Luzon with density ratios of 9.90 and 7.50, respectively.
The Bangko Sentral considers the analysis of regional trends and developments as valuable inputs in monetary policy formulation and financial supervision.
The report tracks economic developments in the regions, focusing on demand and supply conditions, monetary and price developments as well as the emerging economic outlook. It also helps confirm the results of the business and consumer expectations surveys conducted by the central bank. source
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