Integrating the Mindanao economy

Did you know that the Mindanao economy outgrew the rest of the Philippine economy by more than three times in 2009? Through the years, Mindanao’s economic growth has kept pace with and occasionally exceeded the country’s overall economic growth, proving that our southern regions could very well be the vanguard of our national economy in the years ahead. And indeed, it is well positioned to do so, having an extraordinary endowment of natural wealth in various forms, on land and in the waters, more than other parts of the country.

The age-old lament about Mindanao is that there had not been a unified Mindanao economy to speak of in the past. What it had was a fragmented economy whose progressive growth centers (particularly the cities of Cagayan de Oro, Cotabato, Davao, General Santos and Zamboanga) lacked meaningful links among one another. Instead, each had stronger links with Manila and Cebu in a vertical nucleus-satellite relationship. While this has changed in the last 15 years with improved infrastructure interconnecting these centers, there remains great scope for improvement. As Mindanao looks to its economic future in the next two decades, attaining a unified and integrated economy should be an overriding goal.

The Mindanao 2020 Peace and Development Framework Plan, the new blueprint charting Mindanao’s path for the next 20 years (i.e., covering 2011-2030), seeks to achieve precisely that. The Mindanao Development Authority (MinDA) spearheaded a participatory planning process in coming up with Mindanao 2020, which was nearly two years in the making. That time was spent bringing together various stakeholders and Mindanao-based planning officers from national government agencies and local governments, in working sessions all over Mindanao. MinDA thus believes that Mindanao 2020 finds wide ownership and support from the very objects of the plan, who can also be considered its authors: the people of Mindanao themselves. And because the blueprint embodies their expressed aspirations, the thrusts and strategies embodied therein must be responsive to Mindanaoans’ true needs.

In light of the above, it is quite apt that in the specific area of economy and environment, Mindanao 2020 defines economic and ecological integration as one of two key thrusts (the other one being inclusive wealth creation). Economic integration has an external and internal dimension to it. External integration means that Mindanao must pursue development within the broader national, regional and global contexts. It must widen and deepen traditionally vertical and lopsided economic linkages with Luzon and the Visayas through Metro Manila and Cebu, and achieve a more horizontal, co-equal relationship with them. Mindanao will also play a key role in the regionally integrated economy being envisaged for Southeast and East Asia. This is important in the context of the political conflict in Muslim Mindanao, because while Muslims make up a minority in Mindanao and the Philippines, they are the majority in Southeast Asia. Inclusive economic development in Mindanao, particularly in Muslim areas, thus stands a better chance if pursued in the broader regional context, leveraging opportunities in Islamic products and services. Mindanao must also pursue wider economic links with the Middle East and the dynamic “BRIC” economies of Brazil, Russia, India and China.

Internal integration must happen on two fronts. First, Mindanao’s progressive growth centers must continue focusing on expanding complementary interconnections among one another. More importantly, Mindanao’s growth centers must be more strongly linked to the lagging areas through their respective complementary roles in the economic value chain. This way, the growth centers can help “pull up” the lagging areas, rather than have the latter pull down the former, e.g., through the deterrent effect on investments and tourism of the misplaced perception that all of Mindanao is beset by violent conflict. The value chain needs to be improved to address its traditional lopsidedness in favor of the progressive growth centers. This would be served by having more value-adding activities (such as processing) closer to primary production areas and in smaller enterprises, and clustering of producers to achieve economies of scale especially in marketing.

Ecological integration implies planning Mindanao’s development on the basis of its ecosystems, dominated by marine resources, fertile river basins and watersheds. It means planning with full cognizance of the carrying capacity of the environment and natural resource base. It also recognizes that Mindanao, like the rest of the country, is an archipelagic economy; thus, plans must not be dominantly terrestrial or land-based in orientation. In inland areas, a river basin/watershed-based management approach will help enhance synergy and cooperation (and thus better integration) among and across different government units and administrative jurisdictions. It could also help unify affected residents across cultural, political and socioeconomic lines when they are common stakeholders to the same river basin ecosystem.

Finally, economic and ecological integration implies seeing economic development and responsible stewardship of the environment not as incompatible goals, but as mutually reinforcing objectives that make development sustainable. One without the other is shortsighted and of limited benefit, as past experience in Mindanao has already shown. It is only when both ends are jointly served that the ultimate goals of development would be attained, and the Mindanao economy would find true integration.

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