The botched police operation to arrest international terrorists in Mamasapano has serious implications on business sentiment and the subsequent flow of investments particularly in Mindanao. The perception of risk weighs heavily on the decision-making process of investors. This is the reason no capitalist would put money in troubled places. In fact, the decades-long conflict in Mindanao has been cited as a major factor why the Philippines’ second-biggest island has failed to attract investors and lagged in terms of economic development.
It’s not that Mindanao is lacking in potential. Studies have shown that it has fertile land suited even for high-value crops, and many prospective miners have long been attracted to its rich mineral resources, although much of this interest failed to materialize into actual projects.
It is no wonder then that the business community is backing President Aquino in pushing for peace in Mindanao. If there were only peace on the island, Mindanao could easily fit the role of an economic growth driver for the Philippines. Nearly all business organizations in the country have reaffirmed their support for the peace process. These include the biggest business organization, the Philippine Chamber of Commerce and Industry, the Employers’ Confederation of the Philippines, the Financial Executives Institute of the Philippines, the Makati Business Club, the Management Association of the Philippines, and an alliance of local businessmen called Philippines Inc. Also backing the peace process are regional groups Mindanao Business Council and Cagayan de Oro Chamber of Commerce and Industry Foundation Inc., as well as the Philippine Business for Social Progress.
While extending their ‘’utmost respect and sympathies’’ to the families of the 44 Special Action Force commandos who were killed in Mamasapano, the groups cautioned the public against allowing ‘’political manipulation to take advantage of legitimate emotion and grief, to the point of trumping reason and endangering the gains we have made over the last few years.’’
The private sector, as Philippines Inc. has suggested, should focus efforts on boosting economic development in Mindanao to secure lasting peace rather than demand the resignation of President Aquino or the abandonment of the peace process and the launch of all-out war against the Moro Islamic Liberation Front. The government, it points out, should set up economic zones or provide tax incentives that would help attract more companies to locate in Mindanao, thus creating jobs and sustainable income.
Job creation can indeed result in lasting peace in Mindanao. As Philippines Inc. notes, ‘’providing job opportunities is giving the people an option [other than] becoming mercenaries in a war.’’ Philippines Inc. is in talks with several American and foreign enterprises, all of which had expressed ‘’willingness to pour investments in Mindanao should the situation make it possible.’’
Philippine Inc. brings together some of the most respected business leaders in the country. The members of its board of trustees include Antonio Cojuangco, who serves as chair, Antonio Lopa, Jose Manuel Romualdez, ports magnate Enrique Razon, Justo ‘’Tito’’ Ortiz of Union Bank, Jollibee founder Tony Tan Caktiong, banker Aurelio Luis Montinola, Zest-O owner Alfredo Yao and Eusebio Tanco of Asian Terminals Inc.
Mindanao has missed some investment opportunities because of the crisis resulting from Mamasapano. Mohamad Omar Pasigan, president of the Bangsamoro Business Club, has been quoted in news reports as saying that billions of pesos in potential investments in Mindanao had been put at risk. He cited the group of Malaysian businessmen which cancelled its plan to inspect sites in Cotabato for small hotels and department stores, the Jordanian businessmen looking to invest in up to 50 hectares of banana farms who left abruptly without finalizing a deal, and Singaporean and Malaysian partners seeking to establish a mini-shopping mall business who decided to postpone their investment.
This is not the first time political issues have impacted negatively on the economy. The gains achieved thus far–the spectacular GDP growth rates and investment-grade credit ratings–risk going down the drain if the government fails to calm the situation in Mindanao at the soonest time possible and pursue the peace process to its positive end.
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