Income disparity across the Philippines’ regions has widened, which means the rich are getting richer and shows that population growth dampens the rise in income, according to the National Economic and Development Authority (Neda).
Neda Undersecretary Adoracion Navarro yesterday said in a media briefing the government was continuing to address inequality among the regions even as economic growth at the subnational level “remains robust.”
In 2018, 12 of the country’s 17 regions exceeded the overall national growth pace of 5.2 percent.
Navarro said that in the regions, growth was still mostly consumption-driven, but the investment sector was slowly increasing its contribution.
Thanks to revved up construction activities in both public and private sectors, Bicol grew fastest last year at 8.9 percent, Davao and Mimaropa completed the top three with 8.6 percent.
A decline in the manufacturing sector nudged the National Capital Region to the bottom three with 4.8 percent. Vulnerability to natural calamities limited growth in Cagayan Valley at 3.3 percent and a slowdown in mining pegged Caraga’s at 3.2 percent.
Observations made over the past three years show that no region was consistently the highest nor the lowest in terms of growth. The best performer in 2016 was Eastern Visayas while 2017 had the Cordilleras.
Also, Neda’s estimates showed that regional inequality in income per capita across widened over time—from 2009 to 2018.
“Since the high-income (individuals or households) tend to be located in high-income regions, this means the rich are getting richer,” Navarro said.
Another observation was that regions with the lowest per capita growth rates have relatively high average annual population growth rates.
In particular, Eastern Visayas and Muslim Mindanao have the lowest average per capita growth rates and they also have relatively high poverty rates.
She said that, considering these, the government had to continually increase its efforts in pushing for regional and rural development.
“We need to improve connectivity across regions and enhance the efficiency of transport, communications, and overall logistics network,” she said. “Poor regions must catch up fast.”
Neda has lined up six recommendations for the government to sustain economic growth in the regions:
Improve connectivity and enhance the efficiency of transport, communications and the overall logistics network.
Improve agricultural productivity, efficiency and income especially among small farmers.
Promote greater diversification and strengthen commodity value chain.
Strengthen convergent efforts to enhance competitiveness of local industries especially the small and medium enterprises
Improve access to social services, especially in rural areas.
Strengthen resilience against natural and man-made disasters and risks.