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DAVAO REGION:THE RISING GLOBAL FRONTIER OUT OF THE

PHILIPPINE BACKDOOR


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ContentsMessage i

Foreword ii

PART I. THE DAVAO REGION DEVELOPMENT AGENDAIntroduction

Our craft is primed and mannedLocation, Land Area and Political Subdivision 1Population 2

Labor Force and Employment 2Physical Resources 2

Climate, Land, and Water Resources 2Transportation and Access 2

Economy 3Social Services 4Governance 4

To navigate choppy and treacherous watersH igh poverty incidence 4E nvironment degradation 4L ow levels of economic growth 5P oor access to basic services 5

And stake our claim to the global prizeW orld-standard logistics 5I

nternational market linkages 6N ew markets, emerging industries and the improvement of traditional industries 7

Our compass bears our aim true, leading us to harbors where we are dueH ealthy and empowered households 8E nabling infrastructure 8A bundant harvests 9R obust industries 9T ransparent and accountable governance 9S ustained socio-economic development 9

Our charts detect a journey to global visibility and engagementW

ork for more global presence 10I mprove economic integration 10T rim uncertainties emanating from changes in the global market 10H eighten governance response to environmental challenges and low family incomes 11

With provisions and gear that make the crews sojourn a gainful adventureH ealth and housing 11E ducation and skills development 12A griculture, environmental conservation and value-adding industries 12R oads, bridges, railroads, energy and telecommunications 12T rade and investment, tourism, mining, services and technology 12S ocio-economic development and accountable governance 12


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Contents

PART II. TECHNICAL NOTESIntroduction

Assessment of the Planning Environment 14Preparation of the Development Scenario 14

A. Assessment of the Planning EnvironmentPopulation 15Economy 16Physical Resources 19

Land, terrain, soil and climate 19Water resources and fishing grounds 19Forest resources 20

Tourism Areas 20Mining Areas and Mineral Resources 21ICT/BPO Industries 21Transportation and Access 22

Road transport facilities 22Sea transport facilities 22Air transport facilities 23

Family Income and Services 24Family Income 24Services 25

Education 25Health 25

Governance 26Summary

B. Development Scenario

Epilogue 30

List of Tables

Table 1 Gross Regional Domestic Product, Growth Rates, Mindanao 17Regions, Philippines, 2002-2008 @ Constant 1985 Prices

Table 2 Percent Distribution of Gross Regional Domestic Product, 18Mindanao Regions, 2002-2008 @ Constant 1985 Prices

Table 3 Fish Production, By Type of Production, Davao Region, 2001-2007 18

Table 4 Employment by Industrial Origin, Davao Region, 1993, 1998, 2003, 182007 and Growth Rates

Table 5 Number of OFWs, Mindanao Regions, Philippines, 1995, 2000, 2004 19and Growth Rates

Table 6 Land Area by Forest Cover, Davao Region, 1999 and 2007 20

Table 7 Average Annual Family Income and Expenditures, Mindanao Regions, 24Philippines, 2000, 2003 and 2006


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Contents

List of FiguresFigure 1 Location Map of Davao Region 1

Figure 2 Davao Regions International Linkages 6

Figure 3 Approved/Proposed Major Projects 13

Figure 4 Population Density, By Province, Davao Region, 1995, 2000, 2007 15

Figure 5 Population Growth Rate, By Province, Davao Region, 1995-2000, 162000-2007, 1995-2007

Figure 6 Metallic and Non-Metallic Mineral Resources, Davao Region, 2007 21

Figure 7 Mindanao Road Network, as of 2007 22


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Davao Region:The Rising Global Frontier Out of the

Philippine Backdoor

(A Hearts-2- Hearts Development Agenda, 2010-2020)


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Part I: Davao Region Development Agenda

1

PART I. The Davao Region Development Agenda

IntroductionThe global financial crisis experienced since early part of 2007 prompted many nations to

assess their past economic performance with the end of drawing lessons from its history. ThePhilippines is not an exception. The global financial crisis might not have affected the country asmuch as it has affected other nations, but it has presented the country both lessons and opportunitiestoo valuable for it to forego. To this end, the Davao Regional Development Agenda (DRDA), 2010-2020 takes stock of the regions own performance in the past years and based on its assessment,recommends a set of measures where it can address its deficiencies, maximize its opportunities andimprove its resilience. The preparation of the DRDA was intended to prepare the region for theglobal economic rebound, rally the Davao Regions stakeholders toward a shared development path

and to serve as invitation to prospective partners around the globe.

Our craft is primed and mannedLOCATION, LAND AREA AND POLITICAL SUBDIVISION

Davao Region isstrategically locatedin the southeasternpart of Mindanao,

surrounding theDavao Gulf. It isbordered on the northby Surigao del Surand Agusan del Surof Caraga Region andBukidnon of NorthernMindanao Region. Onits west is CentralMindanao and on itseast is the PhilippineSea. It faces

Micronesia in theSouthern PacificOcean to the east andEastern Indonesiathrough the CelebesSea to the South.

Davao Region spans 19,671 square kilometers of land area; shares 6.6 percent of thePhilippines land area and 19.3 percent of Mindanaos land area. It is comprised of 4 provinces,namely: Davao del Sur, Davao del Norte, Compostela Valley and Davao Oriental; and six cities,namely: Davao City, Panabo City, Tagum City, Digos City and the Island Garden City of Samal.

Figure 1.Location Map of Davao Region


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POPULATION

As of 2007, Davao Region was the fourth most populous region in the country and first inMindanao. It was second most densely populated and third fastest in growth in Mindanao. Amongits component areas, Davao City was the most dense, and had the fastest population growth rate.Davao del Norte, Davao del Sur and Compostela Valley had lower densities but their respectivegrowth rates closely followed each other, next to Davao City. Davao Oriental had the lowestdensity and slowest growth. It is projected that Davao City will be the most dense by 2020,followed by Davao del Norte, Davao del Sur and Compostela Valley. Davao Oriental will be tailingthe 3 provinces.

Spatially, the projected growth in the population density of Davao Region implies a symbiosiswith its neighboring provinces. Davao del Nortes proximity to Northern Mindanao via Bukidnoncould open up opportunities on agriculture. Davao del Sur on the other hand, could maximize itsproximity to the provinces of Sarangani and North and South Cotabato in Region XII. Theseadjoining provinces have almost the same level of projected density as the Davao provinces.

Labor Force and Employment

The regions labor force comprised 65.9 percent of the working age population on the average(2005-2009), higher than the national average of 63.9 percent and at par with most Mindanaoregions. The workers are highly-skilled with the number of overseas workers originating from theregion increasing by 29.7 percent in 2007, higher than the national average of 7.7 percent but lowerin terms of volume. The employment rate was 94.5 percent on the average for the same period. Theemployment followed the trend of the growth of the regions major industries, particularly theslowing down of the agriculture sector and the scaling up of industry and services sectors whichmay explain the rise in the tertiary enrolment toward medical, IT and services-related disciplines.

PHYSICAL RESOURCES

Climate, Land and Water Resources

About sixty percent of the regions land area is forestland, 40 percent is alienable anddisposable. The soil is rich and suited for agricultural crops and its climate is good with rainfallevenly distributed throughout the year. It is also outside the typhoon belt. It has abundantfreshwater sources available for commercial and drinking purposes. The regions major watercatchment areas cover 6,013.57 square kilometers, serving as the receptacle of various riverine

systems. These are Davao Gulf, Pujada Bay and Malalag Bay.

Transportation and Access

The regions arterial road networks substantially connect it to the other parts of Mindanao andthe rest of the country. It is served by thirty (30) port facilities for its cargo and passenger needs.Four of its port facilities are administered by the government and the rest are private-owned. Thegovernment-owned ports are Sasa Wharf and Sta. Ana Pier serving Davao City; Mati Wharf inDavao Oriental serves the eastern portion of the region and Malalag Wharf in Davao del Sur servesthe south side of the region. Three other ports were constructed by the government to serve Maco,Compostela Valley and Banaybanay, Davao Oriental. Sasa Wharf is one of the countrys premierexport and import hubs. It ranks third nationwide in foreign container traffic and fourth in domestic


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and foreign cargoes. Sasa Wharf ships out bulk cargoes to Hongkong, China and Singapore at leastthrice a week. Recently, the Davao Gulf particularly Bunawan, Pujada and Mayo Bays have beendelisted from the areas with perceived risks of the Joint Lloyds War Committee (JWC). JWC is

composed of underwriting representatives and company markets of the International UnderwritingAssociation. This decision of the JWC makes anchorage areas in Davao Gulf a more attractiveoption for international shipping companies which intend to lay-up their idle vessels at the facilitiesopened by the Philippine Government for this purpose.

The regions air cargo and traffic needs are served by the Davao International Airport. It isdesigned to accommodate approximately 1.2 million passengers and 84,600 tons of cargo annually.It is complemented with the latest navigational, security and baggage handling equipment includingan extended single 3,000-meter precision runway which can accommodate large aircrafts such asthe 747s and Airbus A-340s. Besides these two facilities, twenty-eight (28) aerodromes/airstripsare operating and owned by private entities, majority of which provide specialized services toagricultural plantations. The extensive tourism development promotion and the opening of

additional international flights triggered an increase in the international passenger traffic. Withinthe year, it served 11 direct international flights per week to Incheon, Korea; Manado, Indonesia;Hongkong and Singapore.

The region was also substantially covered by telecommunications facilities to the extent of enabling the Business Process Outsourcing services to thrive. Currently, there are 57 BPO centersin Davao City occupying 20,000 square meters of land and employing 3,000 workers which havegrown 56 percent in just one year.

ECONOMY

Traditionally, the regions comparative advantage over other Mindanao regions had beenagriculture. However, the share of the services sector to the total regional output had beenincreasing more than the agriculture sectors share in recent years. Trade contributes the bulk of theservices sector which is largely agriculture-based. This is also true for the manufacturing industrywhose good showing was largely attributed to the processing of agri-related products like food andbeverage. Banana, coconut, pineapple, rubber and abaca are the regions traditional export productswhose destinations included Japan, USA, Korea and some European countries. Banana and coconutare the regions top exports, topping the countrys production in both commodities. The regionsbanana industry contributes 43 percent of the countrys total production and its coconut industrycontributes 17 percent of the countrys total production. The area planted to banana in the regiongrew 42 percent while the area planted to coconut grew 8 percent between 2001-2008. CompostelaValley and Davao del Norte are the regions top producers of banana and Davao Oriental is theregions top producer of coconut. Other traditional export products showing stable growth over theyears are pineapple, mango and abaca. The regions agriculture sector kept the regional economyafloat at the onset of the global financial crisis.

The industries that have potentials for growth are mining, tourism and ICT/cyber services. Theestimates for the regions gold and nickel deposits are 189 million metric tons and 490.7 millionmetric tons, respectively. On the other hand, tourist traffic for the last 6 years had been increasing at10 percent on the average per year. These industries however, were largely vulnerable to changes inthe global market. The mineral production slowed down when the global financial crisis was felt.The regions tourism industry, however, showed more resilience because 90 percent of the touristtraffic was composed of domestic tourists. For BPO centers and ICT services, 30,000 square meters


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of land have been made available. The potential for growth of the BPO centers and ICT services hasbeen shown with seat expansion of over 100 percent in only one year.

SOCIAL SERVICES

The number of graduates in tertiary education had been increasing at 2.52 percent annuallyfrom 2001 to 2007. Remarkable increases had been detected in medical and allied disciplines,service trades and IT-related courses. In recent years, there was a growth in foreign studentsavailing of the regions secondary education and medical school services. A Japanese school wasalso established to serve the education needs of Japanese descendants and residents in the region.

Davao Region is also eyed as a potential Medical Tourism Hub in Mindanao with BIMP-EAGA as a possible expansion area in the future. The Southern Philippines Medical Center,Mindanaos biggest government hospital provides health services as well as research and trainingsboth for local and foreign physicians.

GOVERNANCE

Various initiatives are undertaken to improve governance. The use of online media by theLGUs promoted transparency and accountability in the regions regulatory environment. The LGUsnow provide information on their plans and programs, income and expenditures, as well as, transacttheir bidding processes online. The installation of the governments Local Governance PerformanceManagement System (LGPMS) tracked the performance of the LGUs based on the priorities of thegovernment. The Regional Development Council (RDC) XI also initiated a benchmarking systemwhere the progress of the region toward the attainment of regional targets can be tracked. Thisincluded measuring the absorptive capacities of LGUs and national government agencies in

implementing development programs and projects. For exemplary performance, Davao City earnedrecognition in the Asian Cities Award 2007 as 10 th in the Asian Cities of the Future, 6 th as the MostCost-Effective City and 5 th as Best in Human Resources.

to navigate choppy and treacherous watersThe region faces the following challenges in the decade ahea d:

H igh poverty incidence

The regions poverty incidence worsened with the proportion of the families below the poverty

income threshold increasing from 28.5 percent in 2003 to 30.6 percent in 2006. The regionspoverty incidence was the lowest among Mindanao regions, but higher compared to the nationalpoverty incidence. From 2000 to 2006, Davao Oriental, Davao del Norte and Compostela Valleyconsistently had high poverty incidences compared to Davao del Sur and Davao City.

E nvironmental degradation

Flooding had been widely experienced particularly in urban and urbanizing areas. Landslidesdue to crude mining practices were also experienced in the mined-out areas of the region.


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L ow levels of economic growth

The growth of the regional economy over time was slow. From 2002-2008, the average growthwas 5.15 percent annually in real terms, lower than the Philippines 5.35 percent and trailed behindNorthern Mindanao at 6 percent as far as the Mindanao regions are concerned. During the sameperiod, the regions share to GDP remained flat at between 4.5 and 4.6 percent.

P oor access to basic services

Poor access to basic services had resulted in a less desirable literacy level for the region at 90percent in 2005, lower than the national average of 94 percent. The Net Participation Rates (NPR)for the elementary and secondary levels were decreasing at 1.85 and 1.24 percent annually,respectively. The Maternal Mortality Rate (MMR) was at 123 deaths per 100,000 livebirths and theInfant Mortality Rate (IMR) was at 11.9 deaths per 1,000 livebirths. Both are higher than the

national averages.

and stake our claim to the global prizeThe opportunities for the region are three-fold: 1) it leads other Mindanao regions in logistics;

2) it has the capability to participate actively in the global market; and 3) it has new markets,emerging industries and export products to push its economy forward. These opportunities if tappedand taken advantage of optimally, will increase the chances of the region to address its challengesand achieve its development objectives.

W orld-standard logistics

Inter- and intra-regional travel has been made possible with the improvement of the tri-modaltransport network of the region.

By land, the national arterial and secondary road networks have improved the flow of goodsand people from the region to other parts of the country. The Davao-Bukidnon Road connectsDavao Region to Northern Mindanao; the Davao-Agusan Road links Davao Region with Caragaand the Davao del Sur-Sarangani Coastal Road connects Davao Region to Central Mindanao. Thisconnectivity would be further augmented by the completion of the Kapalong-Talaingod-ValenciaRoad connecting Davao del Norte to Bukidnon, and the improvement of Surigao-Davao CoastalRoad in 2010. These projects would further improve trade links among these areas. A watertransport system that will serve the coastal provinces of Davao Region and Central Mindanao withSamal Island as the Transport Hub will be worth pursuing as this will hasten the flow of goods andpeople between these areas and greatly enhance the regions tourism highway.

By water, the existing seaports would be augmented with the further expansion andmodernization of Sasa Wharf. The P420-million expansion had been designed to accommodate 18foreign vessels at any given time. This facility would be ready for the arrival of cargo vessels fromHongkong, China, Singapore, Australia, Europe, the United States, Middle East and the countriesfrom BIMP-EAGA in the near future. The development of world-class facilities in Sasa Wharf willboost tourism and domestic and foreign trade.


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By air, the Davao International Airport (DIA) has expanded its air routes to serve the variety of passengers and cargo traffic. It is equipped with the latest navigational facilities and security andbaggage handling equipment. Majority of the aerodromes/airstrips provide specialized services to

agricultural plantations . DIAs new terminal building is equipped with state-of-the-art technology toenhance security and provided with an electronic flight information display system for ultimatetravel convenience. It has 14 domestic and international counters that can handle a steady flow of passenger traffic 24/7. The installation of a new Landing Instrumentation System (ILS) upgraded itscompliance to the International Civil Aviation Organizations (ICAOs) Precision ApproachCategory that can accommodate 8-10 aircraft landings per hour.

The regions power demand will be progressively addressed with the completion of the 230KV Maramag-Bunawan Transmission Line, Sibulan Hydropower Project and the Mindanao 3Geothermal Plant.

The region is also served with the latest telecommunications services. Major telecom providers

operate in the region with digital exchanges and radio systems. These are complemented by thelatest wireless services like wireless landlines and internet. The region is provided with sufficientbandwidth to meet the projected demands of BPOs like the call centers and software developmentcompanies. The regions broadcast requirements are ably filled by local AM/FM radios, TVstations, cable TVs and Direct-to-Home (satellite) TVs. Such logistical capability has positionedthe region as a formidable player in the knowledge industry.

I nternational market linkages

The countrys participation invarious international agreementsbenefits the region by way of opportunities in the identified areasof cooperation, most notably alongtrade and investments, tourism,human resource development, agro-industry development, sea and airtransport development, energydevelopment, natural resourceconservation and security.

The Association of South EastAsian Nations (ASEANs) sixmember-countries had been joinedby Vietnam, Myanmar andCambodia. The emphases of itscooperation are the three pillars of security, socio-cultural andeconomic integration. The aim of creating the ASEAN EconomicCommunity (AEC) by 2015 wouldmean a potential market of over 560million people for the country andconsequently for the region.

Figure 2. Davao Regions International Market Linkages


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Under the Brunei-Indonesia-Malaysia-Philippines East Asian Growth Area (BIMP-EAGA),the main thrusts are to develop the agro-industrial, tourism, transport and energy resources of thesub-regions of the member-nations under a framework of increasing trade and investments. From

the Philippines side, the initiative is being pursued to specifically provide a trade and culturalfrontier for the islands of Mindanao and Palawan, and the Davao Region ably serves as gatewayand hub for the cooperation. BIMP-EAGA covers a total land area of 1.6 million square kilometerswith a combined population and potential market for the region of 61.8 million people. The regionsproximity to Australia and New Zealand adds to the potential market of the region.

On the Coral Triangle Initiative (CTI), the protection and productivity of the marinebiodiversity within the waters of Philippines, Indonesia (Central and Eastern), Malaysia (Sabah),Papua New Guinea, Solomon Island and Timor-Leste are the foci of cooperation. Cooperation areasare along human resource development, institutional development and biodiversity conservation.This economic group holds a potential market of 150 million people. The Davao Gulf, particularlyDavao Oriental (the tip of the Philippine Eastern Seaboard) plays a vital role in this initiative.

The emerging cooperation among the Central East Asia Growth Polygon (CEAGPOL)countries involving the Philippines; Taiwan; Hongkong; Macau; Guandong and Fujian and possiblyHainan in China, Okinawa in Japan and Guam/Marianas offers advantages to the region through thecombined potential huge markets of Southeast Asia and Northeast Asia. Cooperation would bealong the promotion of socio-cultural roots and economic interests.

N ew markets, emerging industries and the improvement of traditionalindustries

The agriculture sector had been traditionally driven by the production of banana and coconut.

The biggest traditional importers of these products are Japan for banana and the US for coconut.The new consumers of the regions banana and coconut are Korea and China for banana and Iranfor coconut. Recently, the Netherlands, Denmark and France have been patronizing the countrysseaweeds. The Philippines supplies 42 percent of the total global demand for seaweeds. Of thisproduction, Mindanao supplies more than 60 percent. The region has been participating in thePhilippine seaweeds industry through its aquaculture production which increased 10.5 percentannually from 2001 to 2007. It is projected that the global prices of seaweeds are expected toincrease in the coming years, propelled by surging demand. The region will continue serving itsforeign markets for banana, coconut, pineapple, abaca and mango and will step up seaweedsproduction. China is an emerging market for the regions agriculture and mineral exports. It isexpected to surpass Japan as the worlds second biggest economy.

Given the strength of the regions agriculture sector, the region can participate in the Halalfood industry which the BIMP-EAGA is consolidating and targeting to get a share of 2 percent inthe world market. Global demand for Halal food is projected to reach USD 2.1 trillion in 15 years.Davao City hosts the National Halal Certification Board.

From the services sector, tourism has been one of the regions growth drivers. Tourist receiptshave been growing 10 percent annually and tourist arrivals have been increasing 11 percent. Thesector is forecast to grow at an average of 10 percent annually in the coming years with receiptsincreasing from P8.2 billion to P9.1 billion.

An emerging growth driver for the region is the mining industry. While gold prices in theworld market have been relatively stable during the financial crisis, those of the other metals have


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sharply dipped but are widely anticipated to surge once the global construction industry recoversfrom the meltdown.

The construction industry would be another industry to watch as there is high probability that itwill improve along with the increase in the number of overseas workers and expatriates originatingfrom the region. With the expected growth in the construction industry, the real estate business isalso expected to follow.

From the services sector, trade will continue to dominate but it is expected that the demands of the mining, construction and tourism industries will trim the share of agriculture and agri-relatedservices.

The region can vie as a primary BPO destination in the Philippines. Davao City currently ranksfourth among the Philippines next wave cities for cyber services and is a primary node of thePhilippine Cyber Corridor under the Super Region Strategy. The regions share of BPO centers to

the countrys total is expected to grow, particularly the employment absorption rate currently at 22percent with the interventions from the Commission on Higher Education (CHED) and TESDA interms of improving the work forces English speech faculty.

Our compass bears our aim true, leading us toharbors where we are due

The region envisions increasing its global presence in the next decade. In line with this vision,the region shall aim for the following objectives and targets:

H ealthy and empowered households

Increase in the growth rate of tertiary education graduates of 5 percentLiteracy rate of 95 percentNet enrolment rate of 100 percent by 2015 for both elementary and secondary levelsMaternal Mortality Rate of 27.8 per 100,000 livebirths and Infant Mortality Rate of 5.7 per1,000 livebirths by 2015Malnutrition rate reduced to 7.2 percent among preschoolersIncrease in the number of households with owned residential units

E nabling infrastructure

National roads density of 1 km/sq.km. of land areaRenewable energy sources tapped for development, e.g. 600 MW from hydro power and131 MW from solar, ocean and biomass by 2013100 percent of households energized100 percent of households have access to potable waterIrrigated to irrigable land ratio of 1.0


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Our charts set a journey to global visibility and

engagementThe region shall maximize its participation in the global market by: 1) working for more global

presence; 2) improving economic integration; 3) trimming risks and uncertainties emanating fromthe global market; and 4) heightening governance responses to environmental challenges and lowfamily incomes. The specific strategies are:

W ork for more global presence

Pursue agri-industry with an eye for next-level products up the value chain, markets, andtechnologiesTarget new trading markets, diversify export products and improve the competencies of thelabor forcePosition the region as the Education, Medical and Tourism Hubs of Mindanao with a view toexpanding to BIMP-EAGA; as IT Hub and a Retirement Haven of East AsiaPursue initiatives toward transforming the region into the countrys Halal base and to expandtrade in the Middle East and other Islamic countriesImprove support for the development of industrial and economic zonesPursue the growth of the real estate sector as capital formation to entice tourism and tradelocators

I mprove economic integration

Improve the farm-to-market roads and irrigation facilities; develop alternative and renewablepower sources and maximize the use of online facilities to improve linkages between theproduction and market centers with a view to reducing production costs and affording exportproducts to be price-competitive in the global marketMaximize the benefits of the industry clustering approach to include: 1) addressingenvironmental impacts emanating from the development of priority industries; 2) enhancingaccess of small industries to capital inputs; 3) promoting the principal-subsidiary structure inthe manufacturing sector; and 4) increasing the leverage of local industries to negotiate formore competitive prices of export products in the international market; and 5) ensuringcompetent and skilled human resources

T rim uncertainties emanating from changes in the global market

Pursue the implementation and initiate the expansion of coverage of Customs, Immigration,Quarantine and Security (CIQS) Rules, Regulations and Procedures to reduce trade barriersBroaden foreign market coverage to reduce uncertainties on trade barriers and changes inworld pricesImprove the competencies of the labor force to maximize participation in the global marketand propel local industries with homegrown talentMaximize the benefits of online media to improve the business regulatory environment


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Update the Comprehensive Development Plans(CDPs)/zoning ordinances and ProvincialDevelopment and Physical Framework Plans (PDPFPs) to regulate conversion of agriculturallands to non-agricultural usesUndertake aggressive promotion on the peace and development efforts in Mindanao

H eighten governance response to environmental challenges and low familyincomes

Implement the triple bottom line approach in development projects to maximize socio-economic benefits and minimize environmental impacts, e.g. CSR and responsible miningpractices, internalization of environmental effects to development projectsIncrease efforts on social development toward equipping the population as global players of developmentEnsure the availability and accessibility of safety net programs to minimize the potential

negative effects to vulnerable sectors and prevent poverty from falling below the target level,e.g. food security measures and social medical packages

PRECONDITIONS TO DEVELOPMENT

The preconditions for the 10-year development are the following:

The policy environment for the agriculture, mining and tourism industries should beharmonized and decision zones in terms of land use and water reources should be resolved andreflected in the Land Use Plans and zoning ordinances of the LGUs.The business regulatory environment should be oriented toward achieving more transparencyand accountability.Environmental regulations are enforced and mechanisms for disaster risk reduction andmanagement are operational.Improvements in infrastructure particularly on access roads, power and seaports should bepursued and completed.Basic requirements for health and education facilities are satisfied.

with provisions and gear that enable the crewssojourn a gainful adventure

Development interventions toward achieving the objectives and targets within the 10-yearperiod will be directed at supporting the following thematic interventions and major projects:

H ealth and housing

To prime the region as Mindanaos Medical Hub and Retirement Haven, the health facilitiesshall be improved toward the standard level and the Mindanao Cancer Center in Tagum City shallbe developed. Medical and social programs shall be packaged to include provision of safety netmeasures geared at increasing the resilience of the population in responding to the onslaught of global pandemics. More aggressive housing programs that aim to eliminate the housing backlogshall be pursued.


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E ducation and skills development

As Southern Philippines Education and IT Hubs, improvement of educational facilities andcapabilities including the improvement of skills competencies shall be carried out. Online educationprograms shall be promoted to widen access to education. To increase literacy rates, rural educationand empowerment programs shall be undertaken.

A griculture, environmental conservation and value-adding industries

The agriculture sector shall be developed to increase productivity and improve the trickle-down effects of development to the population. Multiple cropping particularly for coconutplantation areas shall be promoted. Activities toward next-level industries in the value chain of traditional products shall be aggressively supported particularly for banana, coconut, pineapple,mango, seaweeds and abaca. To increase the resilience of farm workers and agricultural production,

food security programs shall be pursued and risk transfer programs for agricultural crops shall beensured. The agriculture sectors sustainable growth shall be promoted with aggressive activities onenvironmental rehabilitation, conservation and preservation programs.

R oads, bridges, railroads, energy and telecommunications

The infrastructure sector shall be developed to support the requirements of the industrial andeconomic zones, tourism and production areas and clinch the regions niche as the countrys Halalbase. The tri-modal transport shall be continually developed to further increase internal access andexternal connectivity. Alternative energy sources shall be tapped to boost power supply andincrease household access. The coverage of telecommunications facilities shall also be expanded.

T rade and investment, tourism, mining, services and technologyTo further boost the growth of the services sector, policy and fiscal support for small- and

medium-scale industries shall be improved and fiscal incentives for new and emerging industriesparticularly the downstream and upstream industries of export products shall be supported. Themining industry shall be developed within the responsible mining framework. Policy harmonizationactivities shall be undertaken to support the development of the agriculture, mining and tourismsubsectors. Davao Region shall be promoted as BPO destination to create a beachhead for other IT-related activities.

S ocial development and accountable governance

The social sector shall be sustainably developed by ensuring that poverty reduction programsshall be pursued via job creation activities. Safety net measures for disaster-related phenomena andpeace and development programs shall be vigorously advocated. The updating of Land Use Plansand Comprehensive Development Plans with corresponding zoning ordinances with priorities fordecision zones surrounding agriculture, mining and tourism areas shall be undertaken. Websitedevelopment access for LGUs and Local Government Performance Management System (LGPMS)tracking shall be the regions primary tools in pursuing accountable governance.


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Figure 3. Approved/Proposed Major Projects

Mindanao Rural Development ProgramDavao Industry Clustering Program(coconut, mining)Mineral Investment Promotion ProgramAgricultural Ecotourism PromotionDevelopmentSurigao-Davao Coastal RoadMati-Maragusan RoadCompostela-Cateel RoadRehabilitation of Mati AirportCompostela-Cateel RoadMicro-hydro and biomass, wind resourcepotential energy development projectBaganga BridgeScenic HighwayIntegrated Coastal ResourcesManagement CenterRehabilitation of Communal IrrigationProjects

IT Hub/BPO DestinationMedical Hub, Education Huband Retirement Haven-related

activitiesFood Exchange ComplexMindanao Railway System (DC-GSC component)Buda CIPModern Sea Travellers CenterDS-DC-DN Railway ProjectDC-IGaCoS Bridge ProjectBunawan-Maramag Power LineProjectDavao Industry ClusteringProgram (tourism)Tamugan Surface WaterDevelopment ProjectTamugan Hydro Power PlantProject

Davao Industry Clustering Program(banana)Agricultural Eco-tourism PromotionDevelopmentMindanao Rural DevelopmentProgramFood Exchange Complex (TagumCity)Rehabilitation of Waterways inSelected Samal Water TransportHubTagpopongan PortIGaCos Circumferential RoadDS-DC-DN-Bukidnon RailwayProjectMindanao Cancer CenterRehab of CIPsWorld Class MarinaRehabilitation of River Basins inMindanaoValencia-Talaingod Road

Mindanao Rural DevelopmentProgramAgro-Industrial and AgribusinessEconomic ZonesMineral Investment PromotionProgramJewelry Industry ProjectsKalaw BridgePantukan PortTagbibintaCIPAguacan CIPNuevo Iloco CIP

Mindanao Railway SystemBiofuelsAssessment and Clean up ofAbandoned MinesDiwalwal Road

Davao Industry Clustering Program(mango and seaweeds)Tourism Gateway Project

Mindanao Rural Development ProgramMango Industry Development ProjectKiblawan-Panaglib CIPMindanao Railway System (DC-GSCcomponent)Ocean Thermal Energy DevelopmentDS-DC-DN Railway ProjectFood Exchange Complex (Digos City)BiofuelsSibulan Hydro Power Plant ProjectDavao del Sur-Sarangani RoadPadada-Kiblawan-Matanao-SaranganiRoadBiomass resource energy explorationprojectRice Processing Complex


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Technical Notes


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Part II: Technical Notes

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PART II. Technical Notes

IntroductionThe preparation of the Regional Development Agenda (RDA) requires the review of the

regional economy and a proposal for a development scenario in the next 10 years. Thus, the firstpart of this Technical Notes presents an assessment of the regions planning environment and thesecond part presents the process how a proposed development alternative was selected.

1. Assessment of the Planning Environment

As suggested in the Guidelines on the Preparation of the RDA , the Existing-Trend-Comparison-Significance to the objectives (ETCS) format was used in the intra-area analysis of the regions planning environment. Historical data mainly from 2001-2008 were used toestablish the trajectory of the various development indicators used in the analysis and theregions performance was assessed against the performance of other Mindanao regions and of the Philippines to obtain the benchmarks for the regional targets.

Davao Region underwent various configurations earlier than 2000 which explains thepreference of using 2001 as the lower end of the time-frame in the analysis. The intra-areaanalysis was done at two levels: a) comparison among the component areas of the region; andb) comparison among Mindanao regions and that of the Philippines. The comparative analysisamong the component areas of Davao Region was done using a 2-dimensional matrix reflectinga set of selected sectoral indicators compared by province/city and the region. The main sourcesused in this process were the Provincial Development and Physical Framework Plans (PDPFPs)which have recently been updated with the Provincial/Local Planning and ExpenditureManagement (PLPEM) as Guidelines. The existing disaggregation of data available in officialsources constrained the comparative analysis among the five cities of the region. So, theanalysis was limited to the four provinces and Davao City.

The results of the intra-provincial analysis were used to assemble a SWOT matrix whichyielded insights on the relative strengths, weaknesses, threats and opportunities of the regionmaking it convenient to derive at the outset, a set of strategies that recognizes the regionsinternal and global environments.

2. Selection of the Development Scenario

The results from step 1 were used to obtain the proposed development scenario for theregion, to wit: a) Agriculture and Services and b) Agriculture and Industry with emphasis onmining, tourism and ICT. A simple modified Goal Achievement Matrix (GAM) was used todetermine which of these development alternatives have the most potential to achieve theregions goals and objectives for the planning period.

Unlike the usual GAM, the assignment of weights for each goal was not applied in thisprocess as equal importance was given to each goal. Thus, each goal was assigned a set of 3criteria. Instead of the weights, a qualitative measure was applied for each criteria ranging fromlow (1); medium (2) to high (3) to denote the potential of a development alternative to satisfy aparticularly goal given a particular criterion. The scores were added in a straightforwardmanner. The development alternative with the higher score was selected.


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Population Density, Davao Region94 - 172

173 - 245

246 - 269

270 - 463

464 - 560

0 4 7, 50 0 9 5, 00 0 1 4 2 ,5 0 0 1 9 0, 00 023,750Meters

1995 2000 2007

1. Assessment of the Planning EnvironmentA. POPULATION

In 2007, Davao Regions total population of 4.15 million was fourth most populous region inthe country and first in Mindanao. It shared 5 percent of the countrys population and 19 percent of Mindanaos population. It was second most densely populated and third fastest in growth inMindanao. In 1995, Davao Region was fourth among Mindanao regions in density but it hasovertaken most regions in 2007, making it the second most densely populated next to ARMM.From 1995 to 2007, Davao City was the densest area in the region, increasing from 348 to 588persons per square kilometer. Not one of the regions provinces has yet reached half of DavaoCitys density level. Next to Davao City, Davao del Norte followed with density ratios rising from170 to 245. Davao del Sur tailed Davao del Norte at densities growing from 161 to 209.Compostela Valleys density ratio reached the hundredth mark in 2000, increasing to 166 in 2007.Davao Orientals density, on the other hand, has never reached the hundredth mark over the years(Figure 4).

Figure 4. Population Density, Davao Region by Province, 1995, 2000, 2007(persons/sq.km.)

Source of population data: NSO

Davao Regions population growth rate from 1995-2000 was 2.41 percent, higher compared to2000-2007s 1.71. The regional configuration at this time still includes parts of Caraga andSOCCSKSARGEN. From 1995 to 2007, the growth rate was slower at 1.98 percent compared to1995-2000. Over time, Davao City exhibited the fastest growth at beyond 2 percent. Growth wasfastest in 1995-2000 at 2.83 or nearly 3 percent. Davao del Sur followed Davao City with aremarkable growth of 2.47 percent in 1995-2000, overtaking Davao del Nortes 2.22 andCompostela Valleys 2.37 percent. In 2000-2007 however, Davao del Surs growth slowed down at1.12 percent, lower than Davao Orientals 1.19 percent and Compostela Valleys 1.30 percent.Davao del Nortes growth rate consistently follows Davao City. Davao del Norte is usuallyfollowed by Davao del Sur then by Compostela Valley. Davao Orientals population growth ratenever reached the 2 percent-mark over the years (Figure 5).


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Population Growth Rate, Davao Regio1.12 - 1.54

1.55 - 1.97

1.98 - 2.40

2.41 - 2.83

0 4 7 ,5 0 0 9 5, 00 0 1 4 2 ,5 0 0 1 90 ,0 0023,750Meters

1995-2000 2000-20007 1995-2007

At the current rate, it is projected that the regions density will increase to 256 persons per squarekilometer in 2020 with Davao City reaching 691. The provinces will tail Davao City in the

following order: Davao del Norte (291), Davao del Sur (256), Compostela Valley (166) and DavaoOriental (155).

Figure 5. Population Growth Rate, Davao Region by Province,1995-2000, 2000-2007, 1995-2007

Source of population data: NSO

B. ECONOMY

In 2008, Davao Regions total output at constant prices was valued at P63.987 billion. Thiswas 4.51 percent of the countrys GDP, ranking Davao Region 7 th among the regions in the countryin both value and growth rate. Compared to Mindanao regions, it is second to Northern Mindanaoin terms of value and third in terms of growth rate.

In 2008, the regional economy slowed down, posting a growth of 3.8 percent compared to 6.6percent in 2007. The lower performance was attributed to the huge drop in production value of themining and quarrying industry which contracted by 8.67 percent compared to a growth of 9.6percent in 2007. The construction industry also dipped sharply from 28.24 percent in 2007 to 5.71percent in 2008. Noticeably, the forestry sector gained the highest growth with more than 125percent in 2008. The manufacturing industry remained bullish in the past 3 years growing from 5.4

percent in 2006 to 8.13 percent in 2008.

About 42 percent of the regions value of production comes from the services sector, 33percent from the industry, and 25 percent from agriculture, fishery, and forestry sector. Trade,manufacturing and the agriculture and forestry subsectors respectively dominated the 3 main sectorsin 2008 with the following corresponding shares: 99 percent agriculture and fishery; 53 percenttrade; and 60 percent manufacturing.

On the average the regions annual growth rate in real terms was 5.15 percent from 2002-2008tailing behind Northern Mindanao at 6 percent, while its share to the countrys total outputs hoveredat 4.5-4.6 percent (Tables 1 and 2).


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Table 1. Gross Regional Domestic Product, Growth Rates, Mindanao Regions,Philippines, 2002-2008 @ constant 1985 prices

Region/Year 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 Average2002-08

Philippines 4.7 6.1 4.9 4.4 7.2 3.8 5.18Region IX 4.5 4.9 6.9 2.1 7.4 2.2 4.66Region X 5.6 6.0 4.4 6.8 7.9 5.3 6.00Region XI 4.2 6.9 4.1 5.4 6.6 3.7 5.15Region XII 3.8 6.4 2.3 6.7 6.7 4.6 5.08Caraga 0.9 5.8 3.9 4.9 8.6 3.2 4.55ARMM 2.6 5.4 3.7 4.1 5.4 1.9 3.85Source: NSCB

Table 2. Percent Distribution of Gross Regional Domestic Product,Mindanao Regions, 2002-2008 @constant 1985 prices

Region/Year 2002 2003 2004 2005 2006 2007 2008 Average2002-2008

Region IX 2.6 2.6 2.6 2.6 2.5 2.5 2.5 2.6Region X 4.8 4.8 4.9 4.8 4.9 4.9 5.0 4.8Region XI 4.5 4.5 4.6 4.6 4.5 4.5 4.5 4.5Region XII 3.5 3.5 3.6 3.5 3.5 3.5 3.5 3.5Caraga 1.3 1.3 1.3 1.3 1.3 1.3 1.3 1.3ARMM 0.9 0.9 0.9 0.9 0.8 0.8 0.9 0.9Source: NSCB

Back in 2001-2003, the regions comparative advantage over the other Mindanao regions wasagriculture, fishery and forestry based on the location quotient values of more than 1, indicating thatthe region was specializing in agriculture, producing products more than its domestic requirementand was exporting. The regions foreign export base for its agricultural products remained strongover the years. This is consistent with the shift in services in recent years as trading, whichdominates the services sector, could largely be agriculture-based.

The regions top traditional commodities for export are: banana, coconut and its by-products,pineapple, asparagus, rubber and abaca. These are exported to the USA, Japan, Korea, someEuropean and Asian countries. Between 2001 and 2008, the regions banana production increased42 percent together with the area planted to banana. Production reached 3.5 million metric tons in2008 and the total area planted to banana in the region reached 80,000 hectares or about 18 percentof the national area dedicated to banana. Banana was one of the regions export commodities whichproductivity increased 36 percent. Coconut production also increased 16 percent between 2001 and2008 while the area planted increased 7 percent. Pineapple production also leapt 36 percent. Othercrops that have potential for export growth are abaca, sugarcane and mango.

Fish production grew 5.6 percent from 2001-2007. It was dominated by municipal fishingproduction with 50 percent coming from this commodity. Aquaculture production grew the fastestat 10.5 percent for the same period although the volume was smaller (Table 3). This subsector has avery high potential to grow in the coming years as demand for aquaculture products in theinternational market, particularly seaweeds, is growing. The Philippines produces 42% of the totalcarageenan production for export and Mindanao shares more than 60 percent of the nationalproduction. Global prices of seaweeds are also expected to rise in the next few years, propelled byincreasing demand.


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Table 3. Fish Production, By Type of Production, Region XI, 2001-2007Commodity Production (In metric tons)

2001 2002 2003 2004 2005 2006 2007 AAGRCommercialFishing

11,355 12,472 12,415 10,163 10,609 14,516 16,870 6.8

Municipal Fishing 27,925 28,354 29,869 29,247 32,574 30,195 34,403 3.5Aquaculture 9,904 11,958 11,548 15,114 11,912 13,119 18,409 10.5Total 49,984 52,784 53,832 54,524 55,095 57,830 69,322 5.6Source: BAS XI

With the agriculture and fishery production potentials of the region, there is a high probabilitythat the region can participate in tapping the US$150 billion global market for Halal, a large-scaleprogram of non-traditional, high-value crops in farms and fisheries and value-adding throughinnovative packaging and agri-processing technologies . Demand for Halal food is projected toreach US$ 2.1 trillion in 15 years. The region under the BIMP-EAGA initiative can participate in its

effort of consolidating and targeting a share of 2 percent in the world market. Under the Medium-Term Philippine Development Plan (MTPDP), Davao Region is cited as the Halal Center of thePhilippines.

Employment in the industry and services sectors held positive growths of 0.75 percent and0.69 percent, respectively. From the industry sector, mining and quarrying posted the highestgrowth during the period with an annual average rate of 6.98 percent annually. Employment levelswere at their lowest in the period 1998-2003, due to the regional reconfiguration transferringSOCCKSARGEN to Region XII. Employment levels in the agriculture and industry sectors werescaled down significantly. After 2003, Davao Regions economy recovered, posting positiveemployment levels in all three major sectors with agriculture drawing the highest growth of 2.3percent. Employment performance from 1993-2007 appears to be following the trend of growth of major industries particularly the slowing down of the agriculture sector and the scaling up of industry and services sectors (Table 4).

Table 4. Employment by Industrial Origin, Davao Region, 1993, 1998, 2003 and 2007and Growth Rate (in 000)

Industry Employment GR1993 1998 2003 2007 93-98 03-07 93-07

Total 1,838 1,917 1,686 1,686 0.85 1.23 -0.61Agri, Fishery andForestry

1,000 943 680 762 -1.17 2.30 -1.92

Agriculture and Fishery 721Forestry 41Industry 182 224 196 202 4.24 0.60 0.75Mining and quarrying 14 25 23 36 12.30 9.37 6.98Manufacturing 107 117 101 95 1.80 -1.22 -0.85Construction 53 75 68 67 7.19 -0.30 1.69Electricity, Gas and Water 8 7 4 4 -2.64 0.00 -4.83Services 656 750 710 722 2.71 0.34 0.69Transport, Comm, Storage 71 94 103 102 5.77 -0.19 2.62Trade 310 319 320 301 0.57 -1.22 -0.21Finance 18 33 15 17 12.89 2.53 -0.41O dwelling and real estate 21 27 5.15Private services* 257 303 251 275 3.35 1.84 0.48Government services

Source: NSCB


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The region also served the continuing international demand for skilled workers. From 1995 to2007 the growth of OFWs coming from the region increased 29.7 percent higher than the nationalgrowth rate of 7.47 percent, although much smaller in volume (Table 5).

Table 5. Number of OFWs by Region, 1995, 2000, 2001, 2003 and2004 and Growth Rate (in thousands)

Region 1995 2000 2001 2003 2004 GR(%)

PhilippinesRegion IX 23 30 28 18 22 3.87Region X 19 15 20 27 28 35.60Region XI 26 31 43 32 34 29.70Region XII 23 21 25 31 30 37.00Caraga 16 8 10 10 10 24.27ARMM 15 10 18 13 31 38.55

Source: NSO

The regions growth drivers remain to be agriculture. Mining and quarrying, tourism andICT/Cyber services are the potential growth drivers, as well as, the construction industry and realestate services sectors.

Although the production of the regions top traditional commodities for export has beenincreasing, they are exported raw and have not been diversified except for coconut. The productionof banana, the regions strongest export is threatened with the entry of new global players likeVietnam and India.

C. PHYSICIAL RESOURCES

1. Land, terrain, soil and climate

About 63 percent of Davao Region is forestland and 37 percent is alienable and disposable.Sixteen percent or 3,263.31 of the regions land area is upland characterized by slopes of 18 percentand above. Seventeen percent or 3,366.64 square kilometers is lowland. The area suited foragriculture comprised more than 5,000 square kilometers. The soil is generally of loam and claytypes suited for lowland paddy, upland crops, orchard and pasture. Its climate is good with rainfallevenly distributed throughout the year and it is outside the typhoon belt.

2. Water resources and fishing groundsThe region has an abundant fresh water supply from both ground and surface sources. The total

water output is 31,049 cubic meters per minute. The current utilization rate of surface water is 10-30 percent in most parts of the region, used for agriculture, commercial and household purposes.The inland fishing grounds aquaculture and mariculture industries to thrive. The total length of coastline is 1,351 lineal meters and the municipal waters span 10,546.32 square kilometers. Thearea used for mariculture activities is 52.5 square kilometers. The regions major water catchmentareas cover 6,013.57 square kilometers, serving as the receptacle of various riverine systems. Theseare Davao Gulf, Pujada Bay and Malalag Bay. Davao Gulf has the largest catchment area of 5,876.35 square kilometers.


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3. Forest resources

Davao Region is the second largest producer of timber in the country, next to Caraga Region.From 1996 to 2000, 78 percent of the logs produced by the country came from Caraga Region, andonly 8 percent is produced by Davao Region. During these years the production of logs and wood-based products was affected by the 1991 log ban.

The regions log production recovered in 2005 with a production of 110,803 cubic meters. In2008, the region was able to produce 49 percent more compared to its 2007 production level.Compostela Valley and Davao Oriental were the regions largest producers of logs and wood-basedproducts.

About 63 percent (12,295.50 sq. km.) of the regions total land were classified as forest lands.As of 1999, the regions forest cover has been reduced to 67.2 percent. From 1999 to 2007, theforest cover was further reduced from 8,262.7 square kilometers to only 7,985.6 square kilometers,or by an average annual rate of 277.1 square kilometers or 2.3 percent (Table 6). Shiftingagriculture and intermittent illegal logging activities have been identified as some of the causes forthe diminution of forest cover.

Table 6. Land Area by Forest Cover, Region XI, 1999 and 2007(in square kilometers)

Forest Type 1999 2007 % ChangeDipterocarp 3,224.61 3,902.17 2.4

Old Growth 738.01 844.71 1.7Residual 2,486.60 3,057.46 2.6

Marginal 1,139.13 771.88 -4.7Mossy 1,093.39 733.65 -4.9Mangrove 45.74 38.23 -2.2

Plantations 1,373.79 1,018.38 -3.7Brushlands 2,525.17 2,293.25 -1.2Open/Cultivated 4,032.80 4,309.82 0.8Sub-total 12,295.50 12,295.50 0A & D 7,376.33 7,676.33 0TOTAL 19,671.83 19,671.83 0

Source: RPFP (2003-2030), RSET (2008)

4. Tourism Areas

The region is rich in natural and man-made tourism resources. The areas covered under theNational Integrated Protection Areas System (NIPAS) are developed as ecotourism sites. The

NIPAS areas have 3 main categories, the natural parks, protected landscapes/seascapes and wildlifesanctuaries. The regions natural parks have a total area of 582.53 square kilometers or 29 percentof the total NIPAS areas. The region has eleven (11) NIPAS under this category and one wildlifesanctuary, the Mt. Hamiguitan Range and Wildlife Sanctuary in San Isidro, Davao Oriental. Asidefrom the NIPAS areas, 53 man-made areas all over the region primed as tourism destinations arecurrently being developed through the Highlands to Islands concept, connecting andcomplementing the urban and rural resources through the improvement of transport and transportfacilities and infrastructure.


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5. Mining areas and mineral resources

About 186.26 square kilometers of regional area is devoted to the production of variousminerals, with 66 percent engaged in the production of metallic minerals and the rest for theproduction of non-metallic minerals. The proclaimed mineral reservation area is 8,100 hectares anddeveloped for the production of gold. The estimated total value of the regions minerals is P171billion. Mining tenements are available and being developed to harness these resources. Figure 6shows the metallic and non-metallic mineral reserves of the region as of 2007.

Source: DENR-MGB

Source: DENR-MGB

6. ICT/BPO Industries

Eighty percent of the countrys BPO centers are in the National Capital Region. Davao Cityhad 57 BPO centers in 2008 employing 3,000 workers and occupying 20,000 square meters of land.As of 2008, 30,000 square meters has been made available for BPO centers. It is projected that theseat expansion of BPOs would increase in 2010 by 100 percent.

Digos CityIsland GardenCity of Samal

Tagum City

Davao del Norte

Davao City

Davao del Sur

Davao Oriental

Compostela Valley

Panabo City

Limestone-6,600,000 m.t.Shale-9,749,128 m..t.Silica-500 m.t.Sulphur-5,009,400 m.t.Sand & gravel-6,460,000 cu.m.

Manganese-108,880 m.t.Chromite-100,103 m.t.Gold-10,000 m.t.Nickel-490,718,582 m.t.Silica-7,299,820 m.t.Marble-1,000 cu.m.Pebble-20,000,000Sand & gravel-1,900,000 cu.m.Magnesite-78,712,000 m.t.

Gold-181,687,465 m.t.Copper-481,775,616 m.t.Shale-3,000,000 m.t.Marble-54,000,000 cu.m.Silica-1,000,000 cu.m.Sand & gravel-7,400,000 cu.m.

Limestone-1,700,000 m.t.Earthfill-75,359 cu.m..Boulders-156,190 cu.m.Sand & gravel-6,460,000 cu.m.

Marble-35,000,000 cu.m.Rock Phosphate-43,800 m..t.Sand & gravel-1,500,000 cu.m.Guano-112,400 cu.m.Lime-7,854,083 cu.m.

Figure 6. Metallic and Non-Metallic Mineral Reserve, Region XI, 2007


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7. Transportation and Access

7.1 Road transport facilities

As of 2007, the regions total road network reached 17,050 kilometers; the road density was0.867 km. per sq. km. of land area. Among the four provinces, Davao del Norte surpassed thenational road density standard at 1.73. Davao del Sur falls two percentage points short to equal thenational road density standard of 1. The paved national roads in Davao Region already reached 61percent. The current road density provides substantial internal connectivity outside the region(Figure 7).

Source of road data:DPWH

7.2 Sea transport facilities

The region has thirty (30) port facilities. Four are administered by the government, while therest are private-owned. The government-administered port facilities are: Sasa Wharf, the base portand main seaport facility of the region, and Sta. Ana Wharf, both located in Davao City. DavaoOriental hosts Mati Wharf, a terminal port and Davao del Sur hosts the Malalag Wharf. Three otherports were constructed by the government, the Maco Port in Maco, Compostela Valley andBanaybanay Port in Banaybanay and San Isidro Port in San Isidro, both in Davao Oriental.

Sasa Wharf is one of the premier export and import hubs in the country. It ranks thirdnationwide in foreign container traffic next only to the highly developed Manila International

SARANGANI

N

SURIGAODEL SUR

AGUSANDEL NORTE

DAVAOORIENTAL

SOUTHCOTABATO

SULTANKUDARATBASILAN

JOLO

TAWI-TAWI

MISAMIS ORIENTAL

CAMIGUIN

ZAMBOANGADEL NORTE

ZAMBOANGADEL SUR

MISAMISOCCIDENTAL

NORTHCOTABATO

LANAODEL SUR

LANAODEL NORTE

SURIGAODEL NORTE

CAGAYANDETAWI TAWI

MAGUINDANAO

AGUSANDEL SUR

DAVAODEL NORTE

BUKIDNON

LEGEND:

PACIFIC OCEAN

B O H O LS

E A

CELEBES SEA

IX

X

CARAGA

ARMM

SURIGAOCITY

GEN . SANTOS CITY

CAGAYANDE ORO CITY

ZAMBOANGACITY

DAPITANCITYDIPOLOG CITY

BISLIG CITY

TANDAG CITY

Figure 7. Mindanao Road Network, 2007

North-South BackboneEast-West LateralStrategic Road A

SAMAL Is.

DIGOS

DAVAO CITY

TAGUM CITY

PANABO

OROQUIETACITY

PAGADIAN CITY

OZAMIZCITY

TANGUBCITY

GINGOOG CITY

BUTUAN CITY

ILIGAN CITY

MARAWI CITY

XII

ARMM

COTABATOCITY

KORONADAL CITY

TACURONG

KIDAPAWAN

XI

Eastern Nautical HighwayCentral Nautical Highway

Western Nautical Highway

to Jagna Port from Binuni Port

To/From Dumaguete City Port and Dipolog City Port

To/From Liloan Port andSurigao City Port

Davao Region


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Container Terminal (MICT) and North Harbor. It is also the fourth performing port of the countryin terms of total container traffic for both domestic and foreign TEUs combined. Sasa Wharf islargely dominated by container cargo of raw materials, bulk cargo, general cargo and passenger

traffic. Containerized bananas loaded at Sasa Wharf were transported via direct routes toHongkong, China and Singapore at least thrice a week. The Sasa Wharf expansion project upgradedthe port facility in 2009 to accommodate up to eight vessels at any given time. The upgradingincludes a world-class Passenger Terminal Building (PTB) that includes development of parkingareas and RORO ramp, a greeter building and a gate complex.

Safety measures are also being undertaken in Davao Gulf designed at attracting internationalshipping companies to lay up their idle merchant vessels in the Gulf. These peaceful measures werevalidated by Aegis Defence Services, the external security consultant of the internationally-renowned Lloyds Joint War Committee (JWC), composed of underwriting representatives andcompany markets of the International Underwriting Association. The JWC has delisted the areas of Bunawan, Pujada and Mayo Bays from perceived risks and enhancing said areas attraction to

foreign vessels for international shipping companies to do business (Manila Bulletin, September 26,2009).

7.3 Air transport facilities

There are four secondary international airports in the Philippines, located in the cities of Davao, General Santos, Zamboanga and Laoag. The Davao International Airport handles bothdomestic and international flights operating to and from Davao City. It was designed toaccommodate approximately 1.2 million passengers and 84,600 tons of cargo annually. It wascomplemented with the latest navigational, security and baggage handling equipment including anextended single 3,000-meter precision runway which can accommodate large aircrafts such as the747s and Airbus A-340s. Besides these two facilities, twenty-eight (28) aerodromes/airstrips were

operating and owned by private entities, majority of which provide specialized services toagricultural plantations.

A new airport facility was completed in 2003, four times larger than the old terminal. To adaptto the domestic and foreign traffic, the new terminal building is highly computerized and moresecure provided with a flight information display system and closed circuit television. It has 14domestic and international counters that can handle a steady flow of passenger traffic. The check-incounters are equipped with electronic weighing scales and conveyors and its baggage handlingsystem is also computerized. For easy boarding, four units of jet bridges (3 domestic planes and 1for international) for passengers are provided. A separate cargo terminal building covers 5,580sq.m. and handles up to 84,600 tons a year.

In 2008, passenger traffic reached 1,692,877. In 2007, the total recorded domestic passengertraffic reached 1,480,408, 1.5 percent lower compared to the traffic volume in 2006. Theinternational passenger traffic, however, increased by 60.6 percent from 33,663 in 2006 to 53,856in 2007. The opening of additional international flights triggered the increase in internationalpassenger traffic. DIA is serving international routes from Davao City to Incheon in Korea, Manadoin Indonesia, Hongkong and Singapore. The domestic cargo traffic was also up by 9.6 percentreaching 45.5 million tons in 2007. The international cargo traffic, on the other hand, reached15,455 tons during the year.


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D. FAMILY INCOME AND SERVICES

1. Family IncomeThe regions average annual family income is second highest among Mindanao regions in

2006 next to Region X. It is P38,125 lower than the nationals average family income and slightlylower than Region Xs average family income by P1,525. Davao Regions average family incomegrew 19 percent from 2000 to 2006. The growth rate was at par with Regions IX and X and slightlyhigher than Region XIIs and the countrys (Table 7).

From 2000 to 2006, the average family expenditure of the region is lower than the averagefamily income which means families have the capacity to save. However, the growth in averagefamily expenditure is faster at 23.3 percent compared to the growth in the average family income of 19.4 percent. The growth in average expenditure of Region X is lower than Davao Regions byabout 3 percentage points.

In relation to poverty, the regions annual per capita income threshold in 2006 was P11,399lower by P3,678 compared to the national per capita income threshold of P15,077. The regions percapita income threshold was also lower compared to Region Xs annual per capita income thresholdof P14,199. However, the proportion of Davao Regions families who fall below the annual percapita poverty threshold reached 30.6 percent in 2006. It surpassed the countrys poverty incidenceof 26.9 percent by 3.7 percentage points. While the region had a lower poverty threshold comparedto the countrys its poverty incidence was higher. From 1997 to 2006, the regions povertyincidence decreased by 0.8 percent but the poverty incidence in the country decreased by 2.1percent. Compared to other Mindanao regions, Davao Region had the lowest poverty incidence butstill way high compared to the Millennium Development Goal (MDG) target of halving the povertyincidence by 2015. Among Davao Regions provinces, poverty is highest in Davao Oriental at 40.8percent, Compostela Valley followed closely at 39.9 percent then Davao del Norte at 37.7 percent.Davao del Surs poverty incidence is lower than the regions 23.3 percent.

Table 7. Average Annual Family Income and Expenditures, Philippines andMindanao Regions, 2000, 2003 and 2006 (in Pesos)

Region 2000 2003 2006 GRAve

IncomeAve

Expenditure

AveIncome

AveExpendit

ure

AveIncome

AveExpendit

ure

AveIncome

AveExpendit

urePhilippines 123,168 99,537 148,000 124,000 172,730 147,180 18.4 21.6Region IX 87,294 67,456 93,000 75,000 125,445 98,675 19.9 20.9Region X 99,486 76,715 109,000 91,000 141,773 116,667 19.4 23.3Region XI 94,408 76,136 117,000 100,000 134,605 115,125 19.4 23.0Region XII 81,093 68,519 113,000 85,000 113,919 95,836 18.5 18.3Caraga 71,726 61,815 90,000 78,000 118,146 99,949 28.3 27.2ARMM 74,885 57,546 83,000 67,000 88,632 74,838 8.8 14.0Source: NSCB


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2. Services

2.1 EducationPrivate schools were the major providers of college education in Davao Region. There were

76 private Higher Education Institutions (HEIs) and 5 State Universities and Colleges serving thehigher education needs of the regions populace, as well as that of its neighboring regions.

For school years 2001 to 2007, the number of graduates in higher education institutionsincreased at an average rate of 2.52 percent annually. Most notable increases in graduates wereobserved in the medical and allied disciplines, followed by graduates of service trades and IT-related courses. In recent years, the medical school in Davao City has been serving students fromIndia and Malaysia. Other secondary and elementary private schools are also serving students fromKorea. A Japanese school was also established to serve the education needs of the local Japanese

descendants.The region has sufficient elementary school classrooms as student-classroom ratio of the

region was within the planning standard of 1:45. This was one of the contributory factors to theimprovement of the performance of the elementary students based on the mean percentage score inthe National Achievement Test at the elementary level from 2004-2008 of 64.0 percent about thesame level as the national average which was 64.8 percent. However, the literacy rate remained atthe 90 percent-level from 1989 to 2003, higher than some Mindanao regions but lower than thenational. The net participation rate in elementary and secondary education was decreasing at anannual average rate of 1.85 and 1.24 percent, respectively. On the average, 2 out of 10 children ages6 to 11 years old were not enrolled in elementary school for SY 2002-2003 to SY 2007-2008.Among the reasons for the declining participation rate were distance of residence to school andpoverty. Davao del Sur had the lowest net participation rate among the provinces. Five out of 10children between the ages 12-15 years were not attending secondary school for SY 2002-2003 toSY 2007-2008. Davao del Sur had the lowest net participation rate in secondary education withonly 33 out of 100 children attending secondary education. Among the reasons cited for the lowparticipation rate are unstable peace and order situation, poverty and the long distance of schoolfrom the residence.

The poor access to education facilities was reflected in the results of the National AchievementTest (NAT) among 2 nd year high school students. There was low mastery in all five subject areasshown in the Mean Percentage Score (MPS) of 44.3 percent during the 2008 NAT, lower than thenational MPS of 49.3 percent.

2.2 HealthIn 2007, Davao Region has 115 hospitals, 24 of which were government and 91 private. Of the

24 government hospitals, two were Level IV Tertiary and DOH-retained hospitals and the rest wereLGU-owned. These hospitals had a total of 1,188 beds. Of the 91 private hospitals, 4 were LevelIV, 9 were Level III, 14 were Level II and 64 were Level 1. These hospitals had a total of 3,423beds.

The regions ratio of hospital beds to population was still below the standard ratio of 1:500.The Provinces of Compostela Valley and Davao Oriental had the highest ratio of hospital beds topopulation.


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under AROs budgets was about 10 percent making all proposed PPAs of the AROs plus anadditional 10 percent gets funded. Another indicator under effectiveness and efficiency is theproportion of LGUs with updated physical framework and land use plans. As of 2008, only 14 out

of 53 LGUs have updated physical framework and land use plans while all provinces have updatedtheir respective Provincial Development and Physical Framework Plans.

Davao City for its own efforts, was recognized in Asian Cities Award 2007 as 10th in theAsian Cities of the Future; 6th as the most Cost-Effective City and 5th as Best in Human Resources.

Summary

Davao Regions population growth and density are projected to be almost at the same level asits neighboring regions implying a symbiosis with the adjoining regions. This could easily open upopportunities for the region to increase its trading ties with Regions X particularly with Bukidnonwith the improvement and construction of port facilities and road connecting Talaingod, Davao delNorte to Bukidnon. Davao del Sur on the other hand, could further improve its link to the rest of Mindanao with the improvement of water transport facilities serving the coastal provinces alongSarangani Province, and Davao Oriental with Samal Island, Davao del Norte as transport hub.

The regions growth drivers remain to be agriculture with high probabilities of growth from themining and quarrying, tourism and ICT sectors. There is high potential for BPOs to further propelthe performance of the services sector. The construction industry along with real estatedevelopment has the potential to increase as growth in the number of OFWs and expatriates areincreasing. The countrys commitments to international agreements, like BIMP-EAGA, ASEAN,CTI and CEAGPOL as well as its proximity to Australia and New Zealand presents a wide marketfor the region to explore and maximize its potentials.

The regions infrastructure facilities can support future growth of the economy asinfrastructure facilities satisfy world standards. The on-line media was seen as an effective tool forpromoting transparency and accountability in the regions regulatory environment. The updating of Land Use Plans will further improve transparency in the local governments and will improvepublic-private sector rapport. Efforts at reducing IRA dependence have shown that the LGUs werecapable of generating their own resources for their development initiatives.

The region has to continue pursuing development efforts to address the challenges of 1) highpoverty incidence; 2) environmental degradation; 3) low levels of economic growth and, 4) pooraccess to basic services. It also needs to develop its untapped resources to propel its growth likemining and tourism. It also needs to improve the upstream and downstream industries of its majoragricultural products to maximize its participation in the global market. To expand and improve itsproduction levels, the region can take advantage of the projected growth in the global demand foragricultural and Halal products. The continuing increase in the global demand for workers pose vastopportunities for the region to improve the competencies of its labor force with the end of improving its participation as players in the global market.

2. Development ScenarioBased on the potentials of the region and its available resources and the need to address its

challenges, the following two possible development scenarios were compared to get an idea whichhas the potential to satisfy the regions objectives. These development scenarios are: 1) Agriculture


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and Services to focus development activities and support to agriculture and services; and 2)Agriculture and industry to focus activities and support to the agriculture, mining and quarrying,tourism and ICT industries.

The following criteria were prepared to measure how each development alternative compares interms of achieving the goals:

Goal 1 : Enhance economic integrationCriteria: Improves physical connectivity

Promotes dispersal of economic activitiesPropels the growth of local industries

Goal 2 : Improves economic growthCriteria : Increases the growth of production and productivity

Promotes value adding activitiesImproves labor productivity

Goal 3 : Reduces poverty and improves access to basic servicesCriteria: Improves the general social situation of the population

Provides employment opportunities and creates new jobsPromotes upgrading of local labor competencies

Goal 4 : Minimizes environmental degradationCriteria: Promotes conservation of resources

Minimizes long-term negative impact to the environmentMinimizes negative impact to other sectors

A qualitative score ranging from low (1), medium (2) and high (3) was applied to show therelative advantages of each development alternative in terms of its potential impact to theachievement of goals.

Summary

Development Alternative 1: Agriculture and Services

This development alternative scored high in goals 1 and 2 and lowest in goal 3. Thisalternative has the potential to improve economic integration and economic growth but the benefitsof development is potentially low in trickling to the population as it does not augur well in reducingpoverty and improving access to basic services. The negative impact to the environment however islow.

Development Alternative 2: Agriculture and Industry (Mining, Tourism and ICT)

This development alternative scored high in goals 2 and 3 and low in goal 4. The score for goal1 is also high although not as high as for goals 2 and 3. This development alternative has thepotential to enhance economic integration and increase economic growth. It also has the potential tospread the benefits to the population as it augurs well in reducing poverty and in improving accessto basic services. However, it has the potential to affect the environment negatively, particularly inresource conservation and long-term effects.


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Comparing the results of development alternatives 1 and 2

Both alternatives scored high in improving economic growth (goal 2) but the score of development alternative 2 is higher compared to development alternative 1 for all criteria. On thegoal on enhancing economic integration (goal 1), development alternative 2s score is highercompared to development alternative 1 for all criteria. On the goal reducing poverty (goal 3),development alternative 2 has the more potential to reduce poverty than development alternative 1.For the goal on minimizing the impact to the environment, development alternative 1 scored higherthan development alternative 2. In three counts, development alternative 2 has the potential to havemore positive effects on the goals than development alternative 1.

Suggested development alternative: Agriculture and Industrial Development (Mining, Tourism andICT)

The result of the assessment of the Agriculture and Industry as a development alternativeimplies that it will increase the likelihood of achieving the development goals of the region for theplan period. However, the necessary environmental regulations must be strengthened and enforced.


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Epilogue

Eureka! The slogan HELP WIN HEARTS WITH HEARTS was initially unintended, but as theplanning team grappled with the regions planning environment the acrostic began to unravelcertainly with some help from the teams synergic imagination.

It bears pointing out that the five individual words forming the slogan have more embeddedsignificance than the helpful advice they spell out stringed together

The acronym HELP belabors the regions Challenges as it suggests where the grittyeconomy may need some;

WIN aptly points out the regions Opportunities, confidently proclaiming the generalcontents of its war chest;

The first innocuous HEARTS enumerates the regions Objectives and therefore rounds upwhere its cupids arrows are aimed;

The conjunction WITH is a word that is also typically used to indicate the means of achieving ones objectives, ergo, perfect with which to spell the Agendas Strategies ;

Finally, the impending second HEARTS catalogues the prescription-grade Interventionsthat the region needs to pursue to bring its objectives within sight.

All told, this Development Agendas Technical Notes, starting with the SWOT analysis, provideempirical or qualitative basis to each elemental verse of the acrostic and promptly shoot down anysuggestions that this volumes intentions are literary in nature.


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