MINDANAO CLOSE TO THE HEARTS OF MIDDLE EAST

The Mindanao Chambers of Commerce sent a full delegation of businessmen representing all the major cities and provinces of the island to the recently concluded 34th Philippine Business Conference held in Manila Hotel. Perhaps, because of our distance from Manila; it is always with great anticipation that we look forward to hearing Pres. Arroyo’s speech during the closing ceremonies. And we would listen intently whether the President would drop a word or two about Mindanao. And for the past many years ; she never fails to do so.

Shock Absorbers of the Economy

This year her speech focused on the measures being undertaken by the country to cushion the impact of the recession in the United States. She elaborated that the Philippines has a number of shock absorbers. Among them are our solid banking system ; our projected expatriate inflows was 10% growth; but actual growth so far is 18%. Even if the American economy would sink, the expatriates in that part of the world are in sectors that are less sensitive to recession . These are the teachers, nurses, information technology related workers and caregivers.
The Business Process Outsourcing (BPO) sector will balance off the slow growth in merchandise exports. In addition, pump priming will happen in many sectors and industry ; more so in agriculture, housing, infrastructure, lending support to small and medium sized businesses.

Middle East Relationship to Mindanao

Pres. Arroyo said that the “ Arab engine is up due to the past five years of costly oil. This is has led to the construction boom in the Middle East and a surge of remittances.
What really caught our attention was when she said “, In addition, the fact that the Philippines has a Mindanao close to the hearts of the Middle East, opens up opportunities not only for Mindanao but for the entire country.”

One of the markets that Mindanao has not fully developed is the Middle East, with its countries known not only for their “black gold” but also for their modern infrastructure facilities.

Opportunities for Mindanao

In recent years, the Middle East, most notably the Kingdom of Saudi Arabia and Dubai, has risen to greater heights in terms of investments. However, it was only recently though that Mindanao has slowly gained access to the Middle East markets.
Based on the report of the Bureau of Customs in Davao, the Middle East, in September, collectively brought about $5.763 million in goods from the region, the third among the top 10 countries that were destinations of exports from the region, next only to Japan and Malaysia.

For the Middle East, the bulk of its imports from the Davao Region during the period was fresh bananas with a value of $4.893 million with a volume of 17.758 million metric tons. The figure even excluded the banana imported by the United Arab Emirates which had a value of $447,521.

Even the controversial Iran rose to the fifth position with a value of $4.975 million, or 28.625 million metric tons of goods from the Davao Region, particularly fresh fruits like papaya and pineapple.

The figures would have been bigger had the figures from other regions were available. Nevertheless, the figures were already indicative that the Middle East markets have started taking notice of Mindanao as a big producer of products that its people need particularly as a supplier of food and fruits.

POSSIBLE INVESTMENTS FOR PEACE

Another notable development was the visit of a technical team from the Kingdom of Saudi Arabia whose task was to find areas where they can invest. The seven member team, headed by Ahmed M. AlSadhan of the kingdom’s Ministry of Commerce and Industry, arrived in Davao City late last month. They proceeded to Mati City, the capital of Davao Oriental, to discuss with Gov. Corazon N. Malanyaon the possibility of investing in rice and corn production. Gov. Malanyaon and Mati City Mayor Marie Michelle Denise Rabat gladly briefed the visitors about the province.

The development is one good start for people of Mindanao, particularly its leaders, to consider looking into intensifying trade between the island and the Middle East. People in Mindanao, particularly its local government and business leaders, should start discussing with leaders of the countries within the Middle East region on where they can invest to help the island fully develop its potentials..

Known for their help in achieving peace in Mindanao as most of these countries are members of the Organization of Islamic Conference(OIC) . This is the body that has facilitated peace talks between the Moro rebel groups and the government. I believe they are also interested in helping Mindanao develop into one big producer of the products that they will need – from food, hand made toys, gifts and house wares, furniture’s and furnishings and even in the area of medical , cultural adventure and eco-tourism.

Middle East would be one of the best trading partners of Mindanao not only in business but more importantly in peace and development.

(Joji Ilagan Bian is a strong and respected advocate for the development of the region. She is Chair of Joji Ilagan Foundation ( www.jojiilagancareercenter.com) ; President , Phil. Call Centers Alliance and Mindanao Tech Voc Schools Association; Mindanao Rep, Export Development Council. Email comments jojibian2@yahoo.com)

AUSTRALIA’S RENEWED FOCUS IN MINDANAO

The Australian government is one of Mindanao’s active partner through their various aid programs in education, manpower and skills , gender equity and micro-enterprise support. Today, I am personally involved in Aus-Aid’s human resource development program called Phil-Australia Human Resource Development Facility(PAHRDF), in my capacity as Chairperson of Mindanao Technical Vocational Education Federation (MinTVET). PAHRDF is continuously supporting MinTVET in the training of teachers of technical vocational schools through a scholarship grant in Australia in various fields.

So, it was without hesitation that I immediately accepted the invitation of Mr. Albert Garcia, President of the Philippine Australia Business Council (PABC) when he invited me to attend the business session and luncheon with their counterpart, the Australia Philippine Business Council (APBC) to represent Mindanao. This was during the 2^nd Philippine-Australia Ministerial meeting held in Manila last Oct. 9, 2008.

PABC is one of Mindanao’s strongest partner, despite the fact that all, if not most of their members are Manila based businessmen. Since 1975, PABC and the APBC had implemented trade initiatives to enhance the bilateral partnership and much has also been achieved for the past 38 years of cooperation.

Renewed Partnership in Mindanao

The total foreign trade in Mindanao increased by 24% in 2007 which was valued at US$3.745 billion from US$3.0 billion in 2006. Export earnings grew by 23% valued at US$2.593 billion. Our total imports increased by 27% from US$901.54 million in 2006 and US$1.153 billion in 2007. Unfortunately. Australia is not one of our top ten export partners .

To quote PABC Pres. Garcia, “Unfortunately from a trade perspective there is still much work to be done by the Philippine side to reduce the trade gap.” The huge difference in trade figures in Australia’s favor strongly suggests the indifference by Phil. Business to seriously consider Australia as a lucrative and profitable export market. “.

The PABC is pushing both the Phil. and Australian government‘s bilateral relationship to focus in Mindanao as its principal beneficiary. It is time that our traders shift their attention from Manila and traditional business partners and look again very closely further south into the BIMP EAGA (Brunei –Indonesia-Malaysia-Phil. East Asean Growth Area) and then beyond to the Northern Territory of Australia.

Mindanao exporters should also look at the Northern Territory as the geographic gateway to Australia using the Darwin –Adelaide railway as linkage to the markets of South and Western Australia. This southern direction also points at export markets of the Pacific island economies which are the non - traditional markets, not only for Mindanao exports, but for the Phil. as well. These are the smaller nations like Papua, New Guinea, Noumea, Tonga, Vanuatu and Nuie.

Specific Sectors: Mining, Cattle Fattening and Ship Building

Mindanao also buys its cattle from Australia and “fattens” them in their farms. As a result, there is value in jointly developing a “halal” food industry.

PABC further advocates for the naval and maritime cooperation for peace and development to put into optimal use two significant Phil and Mindanao resources – our rich mineral and human resource relative to ship building technology, facility management and information and communication technology.

An official from the Board of Investment said that around October of this year, there were two(2) Australian mining companies that had started exploring minerals in Agusan del Sur and Surallah, South Cotabato. There is also the mining partnership between Asiaticus Management Corporation (Amcor) and Australian mining giant BHP Billiton which had a joint venture agreement to explore ore deposits at the Pujada Nickel Project in Davao Oriental. Australian Mining firm, Indophil is at Tampakan, South Cotabato .With ore deposits of over 12.8 million tons of 0.6 per cent copper and 15.2 million ounces of 0.2 grams per ton of gold; the Tampakan Copper and Gold Project is reportedly the biggest of its kind in Asia.

The PABC recommends that the mining firms incorporate a food security program to alleviate poverty as part of their social responsibility in the community where they operate

Tapping Mindanao’s Highly Skilled Human Resource

Australia must also contribute in practical terms to Phil. and Mindanao’s skills development. This country is one of the favorite of Filipinos who wants to work overseas because of its attractive migration incentives. PABC is pushing that Australia also contribute significantly to the technical skills and manpower education. As a result, we are also continuously ensured of a robust pool of manpower despite the toll due to rapid migration for better work in other countries. It is suggested that there must be an equivalency program between Australia education in higher and technical education.

Lifting of Travel Advisories to Mindanao

The Australian government ‘s travel advisory to Mindanao is a big hindrance to the realization of all of these objectives and initiatives. The PABC is asking Australia to clearly make a distinction between generally peaceful investment friendly cities such as Davao and Cagayan de Oro and to lift the negative advisory to these cities for a start. The other Mindanao cities such as Gen. Santos, Zamboanga, Butuan and Surigao, after a sufficient period of observation, can follow. These negative advisories are a great barrier to investments.

(Joji Ilagan Bian is a strong and respected advocate for the development of the region. She is Chair of Joji Ilagan Foundation ( www.jojiilagancareercenter.com) ; President , Phil. Call Centers Alliance and Mindanao Tech Voc Schools Association; Mindanao Rep, Export Development Council. Email comments jojibian2@yahoo.com)