Lagging Pacific provinces

The Philippine Pacific coast comprises 17 provinces from Batanes in the north to Davao Occidental in the south, out of 81 provinces.

The total population was 13.2 million in 2015, or 13 percent of the country’s  population and 24 percent of the land area. They comprise 312 municipalities and cities, or 19 percent of the total. More than half (173) of the municipalities and cities front the Pacific Ocean.

Based on the 2015 population census, they are out-migration areas.  The  average population density was 180 persons per square km, less than half of the rest of  the Philippines (390). The population growth rate (1.43 percent a year) during 2000 to 2015 was below the rest of the country (1.93 percent a year).

In 2015, the Pacific provinces accounted for 31 percent of coconut production at barely one ton crop per hectare. They also contributed 15 percent of fisheries value in 2014. The only key players in rice and corn are Cagayan and Isabela.

What is interesting is that the Pacific provinces had an overall poverty incidence of 35 percent in 2012 as compared to 23 percent in the rest of the country. It is reported to have a high concentration of insurgents. Observers claim high poverty primes insurgency.

By contrast, cities in the Asia Pacific that face the Pacific Ocean are progressive.  Japan has Tokyo, Yokohama, Nagoya, Osaka and Kobe.  Korea has Busan. Taiwan  has Keelung and Taipeh.  China has Shanghai, Ningbo, Guangzhou and Qingdao.  Australia has Sydney, Melbourne and Brisbane.

The United States has Los  Angeles, San Francisco, Seattle and Portland. Mexico has the port cities of Lazaro  Cardenas and Manzanillo.

The Philippines has no similar progressive city in the east.  The fact is that the Trans-Pacific trade comprised 420 million 20-foot containers in 2015, growing at 7.2  percent a year between 2005 to 2015 (https://www.unescap.org/).

The US trade alone  with Asia totaled $1.5 trillion in 2015: $457 billion  in exports and $1,007 billion in imports.

The Philippine Pacific coast is lagging for several reasons.

First, it is in the typhoon belt.  Rash climate can devastate agriculture. However, this could be a lame excuse because Taiwan cities have similar typhoon corridors.

Second, the eastern coast has little traditional trade links with other countries, such as China, Europe, and Japan, unlike Metro Manila, Cebu and Davao.

Third, they have a small export base composed mainly of low-yield coconut and  minerals. Little economies of scale for a diversified economic base?

Fourth, there is less dynamism in the area compared to its neighbors.

Fifth, there is high insurgent activities.

A seasoned observer notes that weather, location and infrastructure are key  factors that can influence the development of an area.

There had been efforts to jumpstart economic development via export processing  zones, such as the Cagayan Economic Zone in Sta. Ana, and the Aurora Economic  Zone. Thus far, they have yet to take off after many years. The San Miguel port in  Malita, Davao Occidental, has a potential for a Pacific port. It is too early to tell.

Quo vadis?

Unless a major push is made for an east-west highway connecting Metro Manila  with Infanta, Quezon, or Subic to Aurora, the dream of a developed Pacific coast will  take a long time. The private sector as a driver is strategic.  For now, eco and beach  tourism have very good prospects in Aurora, Bicol, Surigao, and Davao Oriental.

In a related literature, John Luke Gallup, Jeffrey Sachs and Andrew Melliner  studied the complex relationship between a country’s geography and economic growth.  They found that: “Location and climate have large effects on income levels and income growth,  through their effects on transport costs, disease burdens, and agricultural productivity,  among other channels.”

“Furthermore, geography seems to be a factor in the choice of economic policy  itself. When we identify geographical regions that are not conducive to modern  economic growth, we find that many of these regions have high population density and  rapid population increase.”

“This is especially true of populations that are located far from the coast, and  thus that face large transport costs for international trade, as well as populations in  tropical regions of high disease burden”  (US National Bureau of Economic Research  Paper, 1998).

But their conclusions do not seem to apply to Philippine specific region  geography and development:  High population density, rapid population increase and  distance from the coast. It is possible that regions in a poor country have different  geographic circumstances.

What is this article trying to convey?  Despite favorable geographic location,  economic development is not automatic. There are other forces at work: History, culture,  climate, dynamism, initiative, and others that determine one area’s destiny.

The article reflects the personal opinion of the author and does not reflect the official  stand of the Management Association of the Philippines or MAP. The author is the Vice  Chair of the MAP AgriBusiness and Countryside Development Committee, and the  Executive Director of the Center for Food and AgriBusiness of the University of Asia &  the Pacific. Feedback at <[email protected]> and <[email protected]>.  For previous  articles, please visit <map.org.ph>