Mindanao, the ASEAN Integration and the Role of Cagayan de Oro

mindanao cdo

 

This article is originally written for the business column called “Out of the Biz Box” which is published weekly in BusinessWeek Mindanao.

The past year’s successes of the thriving city of Cagayan de Oro have been under the eyes of everyone as the city has been awarded and nominated for multiple achievements. This is actually the best answer to those who are repeatedly asking me “Why CdO?” or “Why Mindanao”?

Let’s look at it through the lens. The Department of Science and Technology has awarded the city for its leadership in “electronic readiness”, an award given for the city’s ease and efficiency in business registrations. Then the city has also won the grand prize in the “Liveable Cities Challenge”, a competition organized by the National Competitiveness Council and the US Agency for International Development (USAID), with the partnership of the WWF and Asia Society. At the same event, and that is the real trigger for thought, CdO has been named “Second Most Competitive City” after Makati City, a very important sign for the future. Cagyan de Oro has then also been nominated by the UN Habitat as one of the “world’s cities of tomorrow” during the World Urban Forum in Colombia, the only Philippine city and one of only two ASEAN cities (the other one is Malaysia’s Johor Bahru) in the list. Really not bad at all. I hear that investors from the Northern Philippines and from abroad are undoubtedly eying this region for its great potential.

What to say about real estate? During my private chit-chats with the executives of CBRE and what we can read in their latest report on the Philippine Real Estate industry, they underline that “properties are still going to be a great investment also in 2015” but with a little more care and a special eye on retail and commercial spaces especially in secondary cities where retail, office and actual housing demand remain strong compared to Metro Manila. I read that UBS has echoed the same in their yearend report. The highly growing presence of BPO’s both in Davao and CdO is gifting a whole new generation with jobs and disposable income. Reading this right, CdO as a secondary and multi-awarded city, is the perfect example for an intelligent forward-thinking investment.

What are the predictable economic consequences of the ASEAN integration for Mindanao? One, for sure, is a more direct approach and exchange of communication for trade and services between regional entities and organizations of the member states. These countries are Vietnam, Indonesia, Malaysia, Singapore, Laos, Cambodia, Brunei, Myanmar and Thailand. Companies from these countries will seek a more direct access to Mindanao using its main sea and air ports of Davao and Cagayan de Oro. No Harvard degree necessary to understand that food processing plants, warehouses and re-packing facilities will definitely increase their presence near those main transport hubs at the same time augmenting opportunities for local SME’s to grow business and create new jobs. Growing beyond national borders will be the challenge and opportunity for local businesses.

Another great news for exports came lately by the EU’s decision to grant the Philippines the GSP+ (Generalized Scheme of Preferences), a “zero tariff” privilege for the export of strategic Filipino products into the EU among which pineapple juice, garments, preserved fruits, tuna, fruit jams and jellies and footwear. The Philippines is the only ASEAN country with this scheme. It is up to the smart Filipino entrepreneurs to figure out how many more opportunities there are in the different industries and business sectors. It’s time to make new international ties with other ASEAN countries, the Middle East and the EU, put away those ideas that working abroad is the answer (in fact the neighbor’s garden is not greener at all this time!) and understand that this is the strategic moment in which to dare and bring out the best in us all.

 

For investment opportunities in Cagayan de Oro and Mindanao, go here