The pandemic has cost the Industry and Services Sector in Mindanao some P316.42 billion in losses, according to an assessment made by the United Nations Development Program (UNDP) and the Mindanao Development Authority (MinDA).
In the Rapid Socio-Economic Impact Assessment of Covid-19 in Mindanao, Researcher Team Leader Christopher Prior said in his presentation on Thursday, the Industry Sector lost P134.35 billion, while the Services Sector lost P182.07 billion.
However, agriculture, fishery and forestry (AFF) saw a growth of P13 million. Former MinDA Chairman and Agriculture Secretary Emmanuel Piñol said this was understandable given that food was a basic need.
“In Region 9, it [AFF] fell by 1 percent, but in the other regions, it grew by up to 3.9 percent in one region in 2019 to 2020. Our opportunity costs study estimated that the growth was worth P13 million,” Prior said.
Prior said lower occupancy rates, passenger traffic, and food services and accommodation hounded the tourism sector of Mindanao.
In terms of food services and accommodations, some regions saw declines of around 28.6 percent to as much as 49.6 percent. In terms of passenger traffic, air travel was 75 percent lower, while sea travel declined by as much as 85 percent.
Tourism receipts in the Zamboanga Peninsula Region, which is the main tourist destination in Mindanao, fell by P2.9 billion in 2020, while in Davao Region, the losses reached P14.1 billion in the first quarter of 2020.
Further, micro, small and medium enterprises (MSMEs) in the region also struggled during the pandemic. This led to significant problems since 99.5 percent of all Mindanao businesses are MSMEs.
These MSMEs accounted for a low of 68.5 percent of all jobs in a region while in others, the share would reach as much as 90.8 percent of total employment.
Prior said in Zamboanga, some 16,000 MSMEs partially or totally closed in the first two quarters of 2020. This led to losses of P8.2 billion by the third quarter of last year.
In Northern Mindanao, the Department of Trade and Industry (DTI) reported some 48,000 businesses partially or totally closed in the second quarter but resumed operations in May 2020.
In the Caraga Administrative Region, data from the DTI showed 71 percent of MSMEs were partially or total closed in April 2020. The estimated losses in this region reached P4.57 billion as of April 2020.
“MSMEs indicated that finance is one of their main obstacles in recovery, particularly because business savings have been ran down; bank loans are not normally designed as ‘business recovery’ loans nor available in the smaller quantities that many MSME would need,” Prior said in his slides.
“DTI CARES [Covid-19 Assistance to Restart Enterprises] loans through SBCorp have to be more easily available and market opportunity consumer fairs should be resumed under health protocols as soon as possible,” he added.
Piñol added that the concerns of MSMEs are the same with Filipino households, especially the middle class. He said the findings of the assessment showed that the middle class had no safety nets to rely on during the pandemic.
He said while rich and poor Filipinos suffered, they were able to rely on their own savings or funds in the case of the rich while the poor were able to rely on government assistance such as direct cash grants or through programs such as the 4Ps or the TUPAD program.
“The fourth point that I liked very much about the presentation of Chris Prior was when he pointed out that the middle class actually was the most affected of all sectors of all society in this pandemic,” Piñol said. “There should be an economic recovery fund available to the middle class for them to be able to get back on their feet and contribute to our country’s economic recovery.”
The lack of programs and policies for the middle class, according to former National Statistical Coordination Board (NSCB) Secretary General Romulo A. Virola, dates as far back as 2010. He said Filipinos, regardless of whether they are poor, middle, or high income are getting poorer in the Philippines.
These policies and programs, Virola said, should include those that seek to “empower” these households to contribute to the country’s economic growth and well-being. He said these include access to affordable credit in case middle-income households would like to get capital to start a business or skills training to sustain their sources of livelihood.
