As I have written in previous columns, a possible move into a federal form of government in the intermediate future will be greatly facilitated if we can pilot the structure of a federal state in some of the provinces with enlightened, proactive and dynamic leaders.  In a recent briefing for existing and potential investors held in the Capitol of Batangas Province by Governor Hermilando Mandanas, I was convinced that his province can hit the ground running and be the first province to already act as a federal state by implementing fully the Local Government Code of 1991 which can enable a local government unit to partner with the private sector to build the needed infrastructures to implement its development plan.  I know very few LGU heads who can match the thorough knowledge of the Local Government Code that Governor Mandanas has.  In fact, when he was Governor the first time around (this is his second round of a possible nine-year stint), he made waves by suing the national government for refusing to release the Internal Revenue Allotment (IRA) to the LGUs.  This case is still pending in the Supreme Court but under the Administration of President Duterte, there is no need even to wait for the resolution of this case because PDu30 will definitely not object to the devolution of as much authority as possible to the LGUs because of his passion for federalism.

          In the economic briefing I gave to the participants of the First Batangas Investment Forum last September 15, 2016, I outlined the strategic role that Batangas can play in the decongestion of the National Capital Region and the creation of an alternative metropolitan area that can span the distance from Sto. Tomas Batangas to Batangas City, comprising some two million inhabitants that will be the manpower base for the growth of industry, agribusiness, tourism, logistics, education, and IT-BPO.  In a study done by USAID, together with some local think tanks, Batangas City was identified as the international seaport in Luzon that can decongest the Manila ports for both international and domestic trade.  In the Visayas, Iloilo was the candidate and already it is showing the potential for double-digit growth of its Gross Regional Product.  The city of Cagayan de Oro was identified as the candidate for Mindanao.  Progress has been slow in CDO because of political intramurals over the last three years.  Hopefully, the new team headed by the same Mayor will be able to overcome the political obstacles.

          Batangas is poised to lead the race for the decongestion of Manila.  I observed that the Governor has tremendous rapport with his Provincial Board.  They are all in the same page, especially as regards the most crucial investments in the transport sub-sector.  They presented to the investors attending the forum the South Railway Line, which consists in the rehabilitation of the 51-kilometer railway line from Calamba City, Laguna to Batangas City, into a modern, convenient and fast rail transport system for passengers and cargoes.  Then in the multi-modal approach to creating an efficient logistic hub, the Governor also presented the conversion of the Fernando Air Base (FAB) into a dual use airport serving the Southern Tagalog Region (SAR), and subsidiary airport to the Ninoy Aquino International Airport (NAIA) in Manila, and the development of a 1,500 hectare area contiguous to the FAB into a dynamic zone through a joint venture with the private sector.  To expand the Batangas port to substantially replace Manila in both international and domestic trade, the Governor proposed Phases III and IV of the Batangas Port Development Project which will consist in land acquisition, development, management and operation of the additional phases into an export processing and free trade zone.  Phases III and IV have a total area of approximately 30 hectares and 100 hectares, respectively.   Finally, another major port development project that can be implemented in the next three years is the rehabilitation and expansion of the Subukin Port in San Juan, Batangas, one of the most attractive sites for domestic tourism.  Already Governor Mandanas and Governor Maranon of Negros Occidental have agreed to foster closer trade relations between their two provinces through the Subukin Port.

          Other projects presented by Governor Mandanas during the investment forum were the Batangas Provincial Livelihood Center (BPLC) and the Regional Food Terminal.  The first involves the rehabilitation, management and operation of  a livelihood center, a 30-storey commercial building with roof deck located at the Phase 1 of the Batangas Port in Sta. Clara, Batangas City.  BPLC will have a total floor area of 19,028 square meters, built on a two-hectare property leased to the Provincial Government until 2028. The second consists in the development, management and operation of the 29-hectare government property located along the Batangas Bay in Barangay Sta. Rita Aplaya, Batangas City, into a Food Terminal Complex in line with the Regional Agro-Industrial Modernization of the CALABARZON region.  This food terminal will be strategically located to serve the vast potentials of the island of Mindoro to be the food belt for the entire Southern Luzon area.  In fact the virtual federal state of Batangas can actually incorporate the whole island of Mindoro as an integral part.  There is a move to unite the two provinces of Mindoro (Oriental and Occidental) into one island region, which in turn can be combined with Batangas into a potential federal state.

              Batangas has already been benefiting significantly from the consumption-led growth of the past five years.   If has been a major supplier for the Metro Manila area of high-value food products, such as hogs, poultry, cattle, vegetables, fruits, coffee and fish products from Taal Lake.  It is also the Number One destination for domestic tourists because of its attractive beaches and diving resorts and accessibility to the 15 million population of Southern Tagalog.   It has attracted hundreds of manufacturing ventures that have located in the numerous economic zones dotting the STAR tollway.  It has caught the attention of BPO-IT enterprises looking for sites outside of the NCR, especially because Batangas boasts of some high-quality universities in Tanauan, Lipa and Batangas City.  There will never be a shortage of college graduates to man the knowledge-based industries.  If the infrastructures mentioned above can be implemented in the next three years, Batangas is expected to grow at 8 to 10% in Gross Regional Product, making it one of the fastest growing regions in the country.  Domestic and foreign investors are well advised to explore investment opportunities in the province over the next three years.    For comments, my email address is bernardo.villegas@uap.asia.