Manila’s not the only place

I was in Kalibo a few weeks ago to attend the Aklan Investment Forum. I was impressed. Somehow, Filipinos always manage to pull off conferences extremely well.

The conference was well-organized, ran almost on time, and had real content and delightful entertainment numbers. It was a positive first step in something we should see much more of: decentralization. And it worked, with private-sector participants committing to the province P9.6 billion in new businesses. The continued migration to Manila of people seeking jobs has to stop. The city can’t handle it.

But it was the content that mattered, and it was full. The organizers, Rep. Ted Haresco and Gov. Florencio “Joeben” Miraflores, pulled in all the key government agencies to give a 10-minute (and they stuck to it) presentation on the opportunities each sector offered.

Kalibo, Aklan’s capital, ranks well in the National Competitiveness Council’s annual Cities and Municipalities Competitiveness survey. In fact, in 2013 Kalibo was cited as the Philippines’ third most competitive municipality, based on three main categories: economic dynamism, government efficiency and infrastructure.

As to what’s attractive about Aklan, tourism is high on the list; with Boracay, how can it not be? But Boracay isn’t all there is: There are other beaches, maybe not equal to its powdery-white sand, but white nonetheless, and appealing, too. They have yet to be developed.

And with San Miguel doubling the length of Caticlan airport together with the development and modernization of the one in Kalibo, one that can now accommodate Airbuses, more tourists will be able to get there. The province has three seaports, all of which are being upgraded, but they remain domestic-oriented. They can’t yet take the international carriers that the new Cabotage Law now allows and cruise ships will find useful. Perhaps this is where the next administration can step in.

Beyond tourism there’s what every Philippine major city can offer today: a home for the IT-BPO sector. Geography is irrelevant for IT. A fast, reliable Internet service and continuous power, modern office space and an educated, English-speaking workforce are what’s needed. Smart and Globe have fiber optic cable to Kalibo, a 25-megawatt wind farm is being built, and a couple of major developers are eyeing commercial development. As to employees, colleges are producing them, and with salaries less than half of what it costs in Manila; there’s real attraction.

The AMA Computer Group has recognized this and is putting up a branch and call center in Kalibo. According to AMA, Aklan has been producing enough graduates who are proficient in English; it also has the necessary vital infrastructure and efficient Internet connectivity for setting up a call center. When completed, the call center facility will be the first in the province. Sitel, one of the biggest BPO companies in the country, can very well follow. It is extremely interested.

Aklan somehow mirrors what you see throughout the Philippines: a province still overly dependent on agriculture at its more primitive level—growing crops, not processing them greatly. Recognizing this, the united and shared leadership of “Todo Asenso” Congressman Haresco and Governor Miraflores wants to concentrate on some key new sectors. High on that list is the intellectual—not just the IT-BPO sector but also educational facilities that go beyond teaching and into research and development. It’s an ambitious, but possibly achievable, goal. Light industries in the manufacturing sector, with emphasis on furniture and handicrafts, is something that others are doing. But if you’ve ever been to the Manila Fame exhibitions, you’d know it’s where some real promise can lie. Fiscal incentives over and beyond what the national government can offer are available in preferred industries. That’s a smart move; businesses love paying less tax.

But I think tourism-related areas are where Aklan can stand out, such as attracting elderly people to retire there, accompanying it with first-class medical and hospital facilities (here an anchor is needed) and, by extension, healthcare tourism. We need to build some world-class hospitals outside Manila. Kalibo can be such a place, with Boracay a mere hour away as the place to recover in. Attracting cruise ships is another niche with much promise. Boracay is now world-famous, so it’s not too hard a sell to convince the cruise companies to stop over and give their passengers a taste of Filipino hospitality—and powdery sand.

As to agriculture, aside from traditional export products like coconut oil, copra meal and desiccated coconut, there’s also a huge market for coir and coconut water. Coir is the fiber obtained from the coconut husk. It can be used to make rugs, ropes and fiber boards. Coco coir net is used for soil erosion control and is ideal for the rehabilitation of football fields, golf course greens, and riverbanks and slopes susceptible to erosion. Western Europe has an annual coir yarn and rope demand of 54,000 metric tons, while Japanese, Korean and European car makers have an annual demand of 137,000 MT of rubberized molded coir. Global demand for coconut water, meanwhile, has been growing tremendously.

But the issue of low productivity has been plaguing the local coconut sector for decades, and Aklan has not been spared. There has been very limited effort made to reverse this. In Aklan coconut occupies the largest area among major agriculture crops, so it’s a product that can be more actively developed.

The Philippines has been growing well in recent years, with an annual average of over 6 percent. But it’s been too Manila-centric. Too much of the benefit of that growth has gone to too few. The Aklan Investment Forum reminds us that there’s a whole other country out there to develop as well.

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