Davao City: A booming economy amid crisis

By Joji Ilagan- Bian
Philippine Daily Inquirer
First Posted 02:15:00 05/02/2009

Filed Under: Economy and Business and Finance

 DAVAO CITY is strategically located in Southeastern Philippines and is linked either by air or sea to major destinations in the country, or by land via the Philippine-Japan Friendship highway.

The new Davao International Airport is one of the busiest airports in the Philippines and also serves as gateway to the sub-regional trade bloc known as the East Asean growth area, with direct flights to Singapore and Indonesia.

Modern infrastructure and facilities in the city provide businessmen access to the 20-million market of Mindanao and the 56-million market of the BIMP-Eaga.

Davao, just like many major cities in Mindanao, is a typhoon-free zone. The all-year round predictability of its tropical weather (sunshine by day and occasional rain showers by night) makes the place conducive for business, leisure, agriculture and other worthwhile activities.

The city is host to regional centers and headquarters of government and private agencies, whose scope of operation covers Southern Philippines or the island of Mindanao. This is the reason why many organizations consider the city the de facto capital of Mindanao. It is considered the financial center of the island, with more than 1,200 institutions classified as banks, non-bank financing, and lending agencies. The city is also the center for learning, education, and training in Mindanao, with 40 tertiary education institutions classified as universities (including the University of the Philippines-Mindanao), colleges, and technical schools.

Davao is one of the most peaceful cities in Asia, with a monthly crime rate of 0.8 cases per 10,000 persons per month. The Davao Police Office is a consistent top pick for the country’s best police office award. The city has also established the 911 central communications and emergency response center in 2002 to lessen the incidence of crime as well as preserve lives and properties.

Investors have been aggressively pouring their money in Davao City—an indication that despite the global economic meltdown, capitalists are still optimistic about the local business environment.

For example, Robinsons Cybergate will be opened to the public next month, although several stalls have opened as early as early three weeks ago. Davaowenyos witness with excitement the construction of the mixed-use Abreeza project of Ayala Land Inc. and Anflo Group of Companies.

What is more exciting is that even property developers, who are known for being sensitive to risk factors, have been building new houses and condotels. Condominium units, considered to be a thing of the past in this part of the country, have been rising left and right, while units are being sold “like hotcakes.”

Several big hotels are also on the rise to accommodate the influx of domestic and foreign tourists.

Several big name developers, like Filinvest Land Inc., Ayala Land, Camella Homes, DMCI of the Consunji Group, Landco Pacific, have been cashing in on the new market enthusiasm.

On the nearby island garden city of Samal, whose tip is just about 10 minutes by boat from the mainland, developers have been building state-of-the-art high-end residential resorts, an indication that the shoreline of the city, known for its white sand and marine resources, will become home to the most modern villas, resorts, hotels and other modern structures.

At present, four big developers have started their respective projects in an attempt to lure even expatriates who want to retire in this part of the country. One developer, the RJP Realty Development Corp., is even setting up a modern clinic, which serves as a selling point to its buyers.

Other developers are providing amenities to lure in buyers. In the case of the Holiday Garden Island Development Corp., which has a 10-hectare Holiday Ocean View project, the company is setting up a modern marina.

Filinvest Land Inc., on the other hand, is concentrating on aqua sports, like hobbie sailing and other related facilities. The Landco Pacific Corp., which has partnered with Anflocor Management and Investment Corp. for its 33-hectare project, is also setting up a beachfront to attract buyers.

My own international culinary and hospitality school, which will be called Institute of International Culinary and Hospitality Entrepreneurship (I CHEF), is a five-story building that will open in July 2009. We will have four commercial state-of-the-art kitchens, a fully operational restaurant for students to operate in and manage; plus foreign and Filipino chef trainers to turn the establishment into one of the best culinary and hospitality schools in the country. We hope this will bring in more overseas students to Davao. Since the cost of doing business is lesser in Davao compared to Manila, tuition will be lower by almost 40 percent without sacrificing amenities.

When I was invited to talk about the local economy, specifically Mindanao, in the recently concluded Philippine Press Institute Conference held at Diamond Hotel, I shared that the strongest drivers of the Mindanao economy amid the crisis are small and medium entrepreneurs like me. And when you look at total investments in Mindanao, the equity share will show that 75 percent of funds are from local investors.

Davao remains hopeful and optimistic that it will survive this crisis for as long as local businessmen’s spirits remain high.

(Joji Ilagan Bian is an advocate for the development of the region. She is chair of Joji Ilagan Foundation [www.jojiilagancareercenter.com], president of Philippine Call Centers Alliance and Mindanao Tech Vocational Schools Association, and Mindanao representative to the Export Development Council. E-mail comments jojibian2@yahoo.com.


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Where rapid and unprecedented economic growth is nothing but the usual

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