It may not be entirely fair to blame martial law in Mindanao as the cause of sluggish business in the island. But business prospects in strife-torn Mindanao are not good, unless the peace and order situation dramatically improves.
Investment pledges in Mindanao dropped 61 percent in the first six months of 2017 to P6.87 billion from P17.74 billion year-on-year. Data from the Board of Investments showed Regions 10 to 12 registered slower growth during the period, except for Region 13 where investments doubled to P1.35 biĺlion.
Trade Secretary Ramon Lopez declined to comment on perceptions that Mindanao was a high-risk area for investors, especially amid the ongoing battle between government forces and Muslim extremists in Marawi City and the declaration of martial law in the whole island.
The six-month data provided by the BoI provide a disturbing trend. Investment commitments in Region 10, or northern Mindanao where Cagayan de Oro is the regional center, plunged 81 percent to P1.38 billion from P7.3 billion on year. Investments in Region 11, or the Davao region, shrank 50 percent percent to P3.21 billion from P6.38 biĺlion.
Investments pledged in Region 12, or the so-called Soccskargen comprising Cotabato, Sarangani, South Cotabato and Sultan Kudarat provinces, plummeted 77 percent to P927.8 miĺlion from P4 billion a year ago. The region includes General Santos City as the center of commercial, industrial and economic activities in the area.
Notwithstanding the BoI data, Mindanao remains a promising investment region. Lopez is still optimistic about the investment prospects “given the island’s strong fundamentals and the strong promise of Mindanao, especially on agro-processing, manufacturing and property development.”
Mindanao, however, will remain the land of promise and an island that will again miss many economic opportunities. Local and foreign investors obviously will skip Mindanao because of the deteriorating peace and order situation in the island.
A prolonged martial law in the entire island, meanwhile, may not be good for business and further dampen investors’ sentiment in the region.