Thursday, April 29, 2021
Davao Region’s economy contracts in 2020
The economy of Davao Region contracted by 7.6 percent in 2020, as measured by the Gross Regional Domestic Product (GRDP) and Gross Regional Domestic Expenditure (GRDE). It was valued at 832.1 billion pesos in 2020 from about 900.9 billion pesos in 2019, a total reduction of 68.8 billion pesos comparing the two periods.
Performance of sub-industries
The top sub-industries with the deepest dive were Other Services with a contraction of 38.2 percent, Accommodation and Food Service Activities with a decline of
34.7 percent, and Transportation and Storage with a drop of 34.5 percent. Declines were also noted in Mining and Quarrying, Manufacturing, Construction, Real Estate and Ownership of Dwellings, Professional and Business Services, Education, and Human Health and Social Work Activities. On the other hand, there were five sub-industries that performed positively in 2020. Topping the list were Financial and Insurance Activities with an expansion of 7.9 percent, Public Administration and Defense with an increase of 6.4 percent, and Information and Communication that grew by 3.9 percent.
Share of Major and sub-industries
Services accounted for 58.9 percent to the region’s economy in 2020. Industry shared 24.2 percent while Agriculture, forestry and fishing (AFF), contributed the least to the total economy of Region XI with 16.9 percent share.
Out of the region’s total Services, Trade and Repair accounted the biggest with 41.3 percent share; followed by Financial and Insurance Activities with 12.0 percent share. Other Services contributed the least with only 1.8 percent contribution to the total Services in the region
Meanwhile, Manufacturing had the biggest share to the region’s Industry, with 45.5 percent; followed by Construction which accounted for 39.1 percent share; Electricity, Steam, Water, and Waste Management accounted for 12.4 percent share; and Mining and Quarrying contributed the least with only 3.0 percent share.
Contribution of major industries to the overall 2020 economic performance
Industry and Services had the biggest contribution to the 7.6 economic contraction of Davao region, pulling down the growth by a total of 7.8 percentage points while AFF contributed 0.2 percentage point to the region’s total economic performance.
Davao Region’s government spending posts growth in 2020
With the recorded decline in Davao Region’s GRDP, all major expenditure items posted decline in 2020 except Government Final Consumption Expenditure (GFCE). Government spending or GFCE of the region increased by 11.9 percent. Household spending or Household Final Consumption Expenditure (HFCE) declined by 7.5 percent while investment or Gross Capital Formation posted a downturn by 15.3 percent. Exports of Goods and Services to the Rest of the World (ROW) and Imports of Goods and Services from ROW also dropped by 26.4 percent and 18.7 percent, respectively.
Share of expenditure items to the regional economy
In terms of expenditure shares, household expenditure had the biggest contribution with 65.8 percent followed by gross capital formation with 26.2 percent.
Contribution of expenditure items to the economic
As to the contribution to the overall economic growth of Davao Region, Net exports to rest of the Philippines and Government final consumption expenditure contributed 2.8 percentage points and 1.1 percentage points, respectively.
On the other hand, Household spending pulled down the economic performance of the region in 2020 by 4.9 percentage points and Gross capital formation by 4.4 percentage points.
Per Capita GRDP/GRDE
In 2020, the per capita GRDP/GRDE or the value of each Davaoeño contributes to the regional economy stood at 157,270 pesos, translating to a decline of 9.0 percent from the 172,912 pesos recorded per capita in 2019.
Per Capita HFCE
Meanwhile the per capita household final consumption, or the household spending for every person dropped by 8.9 percent from 113,693 pesos in 2019 to 103,541 pesos in 2020.
Performance of Davao Region vis-à-vis other regions
The Philippine economy contracted by 9.6 percent in 2020. Ten out of 17 regions in the country have posted lower contraction rates compared to the decline rate recorded at the national level. Davao Region was one of these ten regions.
Examining the structure of the Regional Economies, Region IV-A (CALABARZON) was the only region that is predominantly industrial in 2020 while the rest of the regions, including Davao Region, were predominantly services-based economies.
Among the 17 regions, Davao Region ranked 5th with the highest per capita GRDP/GRDE at 157,270 pesos. It improved its ranking from 6th rank the previous year.
Economic performance of Davao Region over the years
At -7.6 percent, the economic performance of Davao region in 2020 was the lowest since 2001 while the highest was recorded in 2016 at 9.2 percent in 2016.
RUBEN D. ABARO, JR., CESE