Mindanao: Its time has come

“MINDANAO IS the future of the Philippines.”

One of my daughters made this casual but perceptive remark over four years ago, when I brought the family for an enjoyable Mindanao vacation in Tagum City in Davao del Norte. It struck me how she could have come to this conclusion on just her second visit to the island. She had formed her first impression of Mindanao several years prior to that, when she visited a friend at the family home in Bukidnon. Even then, she had been deeply impressed at how richly endowed this part of the country is.

What my daughter seemed to see clearly in two visits, I had already been seeing from years of traveling around Mindanao. I had been asked by the Mindanao Development Authority in 2009 to lead a team of Mindanao experts in facilitating a participatory formulation of the Mindanao 2020 Peace and Development Framework Plan, a process that spanned two years. I was later engaged by AusAID to be its Mindanao economic adviser, focused primarily on Muslim Mindanao. This brought me all around the mainland and island provinces comprising the proposed Bangsamoro region. As an economist mindful of global and regional developments, I saw then, as I see now, how well-positioned Mindanao is to reap great opportunities from those external trends. And to me, this gives Mindanao great headway not only in securing a prominent place in the country’s economic future, but to actually be the country’s future.

What are these external trends? At least three are relevant here: First, patterns of resource availability are changing worldwide; second, consumer preferences are shifting in the global markets; and third, closer and wider regional economic integration is occurring, with the Asean Economic Community (AEC) being most prominent.

Changing resource availabilities are impacting on the supply and cost of primary and manufactured products worldwide. These changes include shifting availabilities of oil and mineral supplies, depleting fisheries, and tightening labor markets due to aging populations abroad. Mindanao’s rich natural wealth, whether in agricultural, marine or mineral resources, will be prominent in the country’s response to changing world market conditions induced by such resource shifts in the world economy. The growing BPO (business process outsourcing) market due to escalating labor costs in advanced economies is another opportunity that Mindanao has begun to cash in on, with a growing number of its cities hosting call centers and other BPO firms.

Second, consumer preferences in world markets are shifting over time. Aging populations have led to rapid growth in demand for geriatric products and services, including retirement estates, medical tourism, and caregiving. Organic products are seeing great growth in demand, especially in wealthier markets that now place a premium on healthier “natural” products. In addition, rapid growth in the giant economies of China and India is creating new demands for food, along with a wide range of consumer products. In particular, demand has been surging for horticultural products (fruits, vegetables and beverages—crops most prominent in Mindanao) not only from China and India but from other large economies as well. Growing Islamic populations in Western countries, the Middle East and Asia have also made halal products one of the most rapidly expanding market segments worldwide, and Mindanao is well-positioned to address these opportunities. All these trends bode well for Mindanao as it is well-positioned to meet the shifting preferences of world and regional markets.

Third, closer and wider regional economic integration holds great opportunities for Mindanao. The AEC formally came into being at the start of this year, and many Filipino firms, both large and small, including many from Mindanao, are already doing good business with it. It’s useful to note that while the Muslim population comprises a minority in the country and even in Mindanao, they make up the majority in Southeast Asia. The AEC is for the most part an Islamic market, something that Muslim Mindanao should be better placed to cash in on relative to the rest of the country, particularly in providing halal products and services. Mindanao is also the country’s logical front-liner on the social, cultural and political dimensions of our closer integration with the broader Asean community, as the region best embodies the Philippines’ common heritage with its Southeast Asian neighbors. In particular, Mindanao is our front door to the subregional initiative on the BIMP-Eaga (Brunei-Indonesia-Malaysia-Philippines East Asean Growth Area), expected to see a renewed boost in the years ahead.

What has traditionally held the island group back, apart from longstanding political conflict, is the long-lamented lack of attention in terms of policies, programs and budgets for the challenges and potentials in Mindanao, from so-called “Imperial Manila.” It has been a valid observation through the years that Mindanao had always lacked proportionate representation in the central national government, particularly in the executive branch, as well as in the Senate.

Well, all that has suddenly changed with one election. Not only do we now have a President from Mindanao; he has also assembled a Cabinet dominated by personalities who would have the interest of Mindanao at heart. At the same time, influential Mindanao lawmakers are poised to lead both the House of Representatives and the Senate. With these, it seems to me that the realization of Mindanao as the Philippines’ future is coming much sooner than both my daughter and I ever expected.

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