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Ilocos Norte leads in poverty reduction

MARCO AVES-UNSPLASH

(Part 1)

National Economic and Development Authority (NEDA) Director General Arsenio Balisacan targets national poverty incidence to be single digit at 9% by the end of the Marcos Jr. administration. It will surprise many Filipinos to learn that the province that President Ferdinand “Bongbong” Marcos, Jr. was once Governor of has been enjoying single-digit poverty incidence for some time, this as the country struggles to bring down the national average from as high as 23% during the height of the pandemic, to 17% today.

According to the latest report of the Philippine Statistics Authority (PSA), Ilocos Norte has a poverty incidence of 2.5% today, one of the lowest in the whole country. The Ilocanos do not have to wait till 2028 to have a single-digit poverty incidence. In fact, I wager that even before the end of the present administration, Ilocos Norte can achieve the admirable goal of bringing its poverty incidence to zero. This fact is even more remarkable if we consider that the incidence of poverty went up practically all over the country during the two years of the COVID-19 pandemic and lockdowns.

Ilocos Norte was the only province in the Ilocos region to have decreased its poverty incidence in 2021 compared to what it was in 2018. In 2018, Ilocos Norte had a poverty incidence of 4.5% (already one of the lowest in the whole country). Despite all the income and employment losses occasioned by the pandemic (for example, the famous Fort Ilocandia had to close down), the poverty incidence dropped to 2.5% in 2021. The other provinces in the Ilocos Region were not as fortunate. For example, in La Union, poverty incidence increased from 4.3% to 9.3% during the same time period; Ilocos Sur from 7.5% to 15.1%; and Pangasinan from 12.9% to 17.9%.

As reported by the Philippine News Agency, during the last 10 years, the PSA has systematically listed Ilocos Norte, which is a first-class province in terms of income, as one of the provinces with the lowest poverty incidence. It also has one of the highest Human Development Index, which measures not only per capita income but also the educational attainment and health of the population. The Ilocos Norte government has long prioritized programs on poverty reduction, especially through programs in agricultural productivity (especially in rice), health, education, job creation, and assistance to micro, small, and medium-scale enterprises.

Of course, it also helps that the Ilocanos are known to be among the hardest working citizens of the country, whether at home or abroad as overseas Filipino workers (OFWs). In fact, even before the term OFWs came into use, Ilocanos were already among the most dependable migrant workers in the sugar plantations of Hawaii. Today, over 55% of Ilocano families continue to receive OFW remittances.

In the next five to six years, there is reason to expect that Ilocos Norte will continue not only to have one of the lowest rates of poverty incidence, but will also be among the fastest growing regions in terms of income and employment.

In a briefing given by Governor Matthew Manotoc in an Investment Roadshow, the following were given as reasons for both domestic and foreign investors to locate in Ilocos Norte. The Laoag International Airport is the only international airport north of Clark and Manila. The road network connecting Ilocos Norte to the rest of Luzon is first class. The North Luzon Expressway, Subic-Clark Expressway, and Tarlac, Pangasinan-La Union Expressway are interconnected highways that serve as the main route from Manila and other provinces south of Ilocos Norte. The port of Currimao plays a vital role in shipping and receiving goods in and out of the province.

The Provincial Government and business community are focusing on investment areas which will experience the most rapid growth in the coming decade or so as the Philippine economy recovers from the ravages of the pandemic.

In food and agriculture, there are bright prospects in processing facilities, equipment, and warehousing; in packaging; cold storage and farm productivity programs. In the tourism and creative industry, there are opportunities in the development of gateways, eco-adventure, leisure and recreation, as typified by the very attractive beaches of the famous Pagudpud; health and wellness; creatives; social entrepreneurship; and hospitality.

In 2019, the province earned P14.88 billion in tourism receipts from over 3.8 million tourist arrivals, 90% of whom were domestic tourists and the remaining 10% foreign, especially from countries of Northeast Asia. As described in some of the brochures given to potential tourists, the province is replete with heritage buildings. There are still many structures standing today which were, built during the Spanish and American colonial periods, such as stone and brick churches with massive belfries and government buildings, bridges, and schools.

It is well known that Ilocos Norte is a pioneer in wind, solar, and hydro energy. The province is ideal for wind turbines because it is near where north westerly winds are consistently strong. The wind power density is 300-800 at 30 m (w/m2) as measured by the National Renewable Energy Laboratory (NREL).

Ilocos Norte’s solar irradiance is well-suited for solar power, with a yearly sum of 1,500-1,600 kWh. The river basins of the province have strong potentials for hydro power generation.

In wind energy, there is an existing 282.90 MW wind power generation plant provided by the Northwind Development Corp., the Energy Development Corp. and the North Luzon Development Corp. In solar energy, the Energy Development Corp., Mirae Asia Energy, and Bosung Solartec, Inc. provide a total of 27.76 MW solar power plants.

Potential investments in wind energy can reach as much as 719 MW in such areas as Pagudpud, Pasugui, Bangui, and Burgos. For solar, the potential can reach 312.5 MW in Pasuquin, Burgos, Paoay, and Currimao. In hydro, the potential areas are Adams, Carasi, Dumalneg, Nueva Era, Pagudpod, and Vintar.

The recent decision of the Energy Regulatory Commission (ERC) to allow 100% foreign investment in renewable energy projects augurs well for the province attracting substantial amounts of FDIs, sorely needed by the country because of the very high level of government debt that was occasioned by all the borrowings made necessary during the pandemic.

Ilocos Norte is a leader in responsible mining and quarrying, with great potentials in mineral deposits and exploration, river dredging and quarrying, mineral ore mining, and the mining support activities. The province showcases a diverse range of mineral potential throughout its 366.20 hectares of total land area that can be devoted to mining among a total of 3,418.75 square kilometers. It is covered by 10.70% of mining tenements according to the Mines and Geosciences Bureau Regional Office. Indicated mineral resources are gold, copper, iron, and magnetite sand, while non-metallic are sand and gravel, shale, feldspar, limestone, and silica. Given these natural resources, potential investments are in mineral deposit exploration, river dredging and quarrying, metallic ore and non-metallic mineral mining, mining unit operations, and auxiliary services and mineral and metal processing.

It may be a happy coincidence that the three sectors enumerated above, i.e., agribusiness, energy, and mining are high in the priorities of the present administration for development as well as facing strong demand as the country and the world recover from the recessionary forces coming from the pandemic.

Food security, especially in rice in which palay producers in Piddig, Ilocos Norte, have some of the highest productivity levels in the country, as well as in high-value vegetable crops, has been already a forte of the province. Ilocos, with a population of only about 610,000, has been punching above its weight by having pioneered in such renewable sources of energy as solar and wind. And finally, by having attracted investors in responsible mining, Ilocos Norte is fortunate to benefit from the high mineral prices — especially in nickel and copper — that are expected to prevail as the whole world experiences the so-called Industrial Revolution 4.0 and the Green Energy Revolution which will require large volumes of these two mineral ores for all the digital devices that will have to be produced to make the IT revolution possible, as well as to manufacture all the solar panels and wind turbines for the production of solar and wind energy.

It would be shortsighted for investors — whether domestic or foreign — to ignore Ilocos Norte in the next three to five years.

(To be continued.)

Bernardo M. Villegas has a Ph.D. in Economics from Harvard, is professor emeritus at the University of Asia and the Pacific, and a visiting professor at the IESE Business School in Barcelona, Spain. He was a member of the 1986 Constitutional Commission.

bernardo.villegas@uap.asia

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