Investor attention in the Visayas has been traditionally focused on the Central Visayas region, particularly the island province of Cebu and Cebu City, the latter also known as the Queen City of the South. Both the city and the region have mirrored Metro Manila closely in stature, infrastructure development, progressiveness and economic growth.
Located in the heart of the Philippines, Cebu has long been considered a natural entry point to the central areas of the country. It was on the island of Mactan that Ferdinand Magellan first arrived in 1521, establishing Cebu as one of the strategic ports and trading centres in the region. Today Cebu is a natural rival to the capital as a trading and transport hub, in addition to one of the most attractive foreign investment destinations in the country. On the western part of the Visayas, Region VI stands as a fast-growing set of five provinces; Iloilo, Capiz, Aklan, Antique, and Guimaras, with the first four located in the Panay Island. Until late 2015, Negros Occidental was also part of the Western Visayas region; it has since been merged with Negros Oriental though an order by President Benino Aquino III to form the Negros Island Region.
Situated in the southern and north-eastern portion of Panay island, Iloilo province is becoming an increasingly more visible investment destination given its geographic centrality, continuous infrastructure development, skilled human resources and cultural attractions, having led the economic expansion of the whole Region VI region, which in 2012 recorded a growth rate of 7.5% in GDP, surpassing the national rate of 6.6%.
Accessibility is a major advantage for Iloilo, with the Iloilo International Airport currently the country’s fourth busiest and providing five weekly direct international flights to and from Hong Kong and Singapore and 58 domestic flights to and from the other key cities in the Philippines. Given sustained passenger traffic growth, the airport is up for bidding under the public-private partnership programme for rehabilitation and expansion in the first half of 2016. Additionally, Iloilo has modern seaports that serve as main trans-shipment hubs connecting Manila and Mindanao. The Iloilo City port remains the third largest in the country, fifth in terms of ship calls at 11,853 per annum, fourth in cargo at 491,719 metric tonnes and fourth in passenger volume at 2.4m. The port accommodates 147 fast craft trips to and from Bacolod City, 27 boat trips to and from Manila, 11 to Cebu, two to Cagayan de Oro, one to Zamboanga and one to Palawan every week. In addition, the province has eight municipal ports, with the Dumangas Port being eyed as the future principal port for the province and a principal link to the Negros Island Region. This is complemented by an extensive network of roads and bridges on the island of Panay, which facilitate efficient commuting and ease traffic.
Iloilo City is a highly urbanised commercial hub that is politically independent from the province. As the financial district for the Western Visayas, the city has the most number of banks outside of Metro Manila. With approximately 115 banks and a burgeoning services sectors, it has been positioned as the 90th destination in the Tholons consultancy 2016 list of the “Top 100 Outsourcing Destinations” worldwide.
Accelerated growth in the past five years has led Iloilo City to witness a growth in commercial establishments, financial institutions and businesses. The main thrust moving forward for the city is centred on balancing rapid urbanisation with ecological concerns, and peace and safety to promote higher socio-economic productivity and economic progress. The rehabilitation of the Iloilo River and establishment of a Business One-Stop Shop to facilitate the processing of business permits both served to improve the profile of the city as a attractive destination for investment. For future growth, the city is working on developing an industrial zone on 400 ha of reclaimed land, while on a provincial level, the municipalities of Dumangas and Concepcion have been eyed as ideal sites for special economic zones given the available infrastructure, stable power supply and reliable telecommunications facilities.
Iloilo province’s growth trajectory is supported by a stable power supply able to meet both current and projected future demand requirements. The Panay Energy Development Corporation operates a 164-MW coal-fired power plant at the heart of Iloilo City, having broken ground for a 150-MW expansion in 2015 that is set to become operational by June 2016. In the north-eastern municipality of Concepcion, in Iloilo province, Palm Concepcion Power Corporation is constructing a two-unit, 135-MW coal-fired power plant. The expansion of power projects on Panay Island have served to stabilise electricity supply for the entire region, reduced the price of electricity in Iloilo City by as much as P3 ($0.07) per KWh and diminished dependence on submarine cables, which has improved power supply efficiency. In addition to coal-fired facilities, Panay Power Corporation operates a 72-MW diesel fuel power plant in the district of La Paz, Iloilo City. The Visayas grid has a total 2216 MW as of January 2015, with a dependable 415 MW output capacity up until 2023; therefore, if peak demand in the next five years increases by 307 MW, the region will still have a surplus of 108 MW. To complement conventional energy types and address peak demand, the southern island of Guimaras boasts a 54-MW wind farm by Trans-Asia Renewable Energy Corporation, which also supplies Panay Island.
The Metro Iloilo Water District provides potable water in Iloilo, and additional supply for domestic and industrial consumption is expected upon the completion of the Jalaur River Multi-Purpose Project Stage II, which will be the first large-scale reservoir dam outside of Luzon and will provide uninterrupted irrigation water supply to 32,000 ha of farm land, in addition to an estimated 86,000 cu metres of potable water. As of March 2016, the Philippine and South Korean government have signed a deal on official development assistance funding for the P11.8bn ($262m) project, which estimates completion in 2018. The project has an additional 6.6-MW hydroelectric component. The water supply system has further been boosted by an agreement between the Metro Iloilo Water District and MetroPac Water, a subsidiary of Metro Pacific Investment Corporation, to operate and maintain a bulk water project in a joint venture. It will seek to rehabilitate, operate and maintain Metro Iloilo water production facilities with the goal to supply up to 170m litres per day in the next 25 years, much more than the province needs.
Although only around 10% of Iloilo City is devoted to farmland, it benefits from abundant agro-fisheries in the province where fruits, vegetables and marine products are also plentiful. Roughly 70% of the provincial land area remains devoted to agriculture, while the surrounding water areas are rich in marine life. Iloilo ranks fourth in national rice production with 249,016ha and 974,781 metric tonnes as of 2013, fifth place in corn production with 22,848 ha and 81,444 metric tons as of 2013 and eighth in mango production with 478.14 hectares and 6214 metric tonnes as of 2013.
Since the hosting of the APEC conference in 2015, Iloilo’s visibility as a meetings, incentives, conferences and exhibitions destination has been boosted. International and local hotel brands have increased their investments in the city, now catering to executives and investors, while the construction of the Iloilo Convention Centre, with a capacity to hold 3700 people, has further increased the competitiveness of the city to host international events.
Services accounted for 57.5% of GDRP in Region VI in 2012. Several projects like the 54.2-ha Megaworld Iloilo Business Park and the 2-ha Ayala Land Technohub are substantially increasing office space to accommodate business process outsourcing (BPO) expansion. The ICT-BPO industry has caused a rapid shift towards services, driving growth in Iloilo.
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