Consortium for the Advancement and

Development of the Local Economies of Samar

(CANDLES)

Blueprint for the

Development of the Local
Economies of Samar

The Challenge to Reduce Poverty

and Turn Around the Local
Economies of Samar

Prepared for CANDLES by: JAY BERTRAM T. LACSAMANA

 Table of Contents
Introduction ........................................................................................................................................ii
Chapter 1 Blueprint Framework.......................................................................................................1
Capter 2 Samar, the Philippine Economy and Poverty.................................................................5
Macroeconomic Assessment ..................................................................................................................5
Sector Performance .................................................................................................................................10
Infrastructure, Establishments and Housing......................................................................................12
Agrarian Reform .......................................................................................................................................18
Chapter 3 Community and Household Assessment ..................................................................20
Spatial Characteristics of the Pilot Communities ..............................................................................20
Socioeconomic Assessment of the Surveyed Households ............................................................25
Households in the Pilot Communities: Findings and Insights........................................................28
Chapter 4 Local Governance .........................................................................................................29
Institutional Assessment of LGUs ........................................................................................................29
Specific SWOT Analysis Findings ...........................................................................................30
Institutional and Organizational Support to Local Governance from the Regional Level........31
Samar Local Economy Building and Local Governance .........................................................32
Chapter 5 Civil Society Organizations..........................................................................................33
Civil Society Organizations in Samar ...................................................................................................33
Conclusion.................................................................................................................................................35
Exploring Opportunities of Working Together ...................................................................................36
Chapter 6 Development Financing Institutions...........................................................................37
Major Characteristics of Financing Entities ..........................................................................................37
Specific SWOT Analysis Findings ..........................................................................................................38
Development Financing Entities: Findings and Insights....................................................................38
Chapter 7 Private Investments and Remittances........................................................................40
Small Private Investments in Northern and Eastern Samar...............................................................40
Investment Potential of Remittances......................................................................................................46
Chapter 8 Blueprint Specifications: Strategies & Interventions ...............................................49
Overall SWOT Results and Emerging Strategy Options ....................................................................49
Translating Strategies to Themes of Model Interventions .................................................................55
Chapter 9 Program and Project Ideas...........................................................................................63
 Introduction

T
his “blueprint” or development strategy and plan adopted by the Consortium for the Advancement and
Development of the Local Economies of Samar (CANDLES), proffers a development path for the five
pillars of the local economy in their march towards poverty reduction and sustainable local economic
development in the impoverished island of Samar. It contains overall situational analyses of the major
stakeholders and development actors in Samar and how their interrelationships and interactions can be
directed towards the common goal of reducing poverty and helping turn around the local economies of
Samarnons. Development specifications and strategies proposed are essentially along the strengths,
weaknesses, opportunities and threats characterizing the five pillars.

Using common development planning approaches, the development strategies and blueprint
specifications formulated were based on the expert analysis of major trends found in its companion document,
the Baseline Survey on the Major Elements of Local Economy Building in Identified Pilot Areas in Eastern and
Northern Samar. In this compendium or source book, primary and secondary data gathered were on the
following five pillars of the local economy:

1. The poor and the enterprising poor communities and households;

2. Local governance entities and their instrumentalities that have specific mandates on poverty
reduction and local economic development;

3. Civil society and non-government organizations working along economic development and
advocacy work;

4. Development financiers (public and private) and microfinance institutions; and

5. Private sector participation and the role of overseas Filipinos, particularly in re-directing their
remittances to local economy building activities

The primary framework of analysis adopted in this study is the conceptual model used in Population
and Development Planning’s (POPDEV) “Basic Framework for Analyzing Socio-economic and Demographic
Interactions at the Household Level”, developed in 1993 by Dr. Alejandro Herrin of the UP School of
Economics and popularized in the 1990s among development planners at the national, sector- and regional-
local levels. The model, as shall be elaborated in the succeeding chapter, is appropriate for formulating “local”
and/or “micro” development interventions, designing and focusing these among the target poor and
entrepreneurial poor households and communities. The model supports the matching, convergence and/or re-
alignment/re-designing of development interventions and efforts of the various development actors or the five
pillars as they influence the poor household’s economic, investment/savings and enterprise decisions.

The baseline data, strategies and blueprint specifications greatly benefited too from the key analysis
and established findings contained in various related development plans formulated for the area. These are the
Regional Development Plan for Eastern Visayas Region and its complementary plans, particularly the
Regional Physical Framework Plan; the Provincial Physical Framework Plans of the Samar provinces; the
Provincial Development Plans; and where present, the Municipal Development Plans and Investment
Programs.

This blueprint does not in anyway intend to pose as an alternative to existing plans of any entity. It
supports and advocates the key features of other plans, researches or advocacies particularly for the benefit of
the poor and entrepreneurial poor of Samar. It is a dynamic plan, a work-in-progress meant to guide

ii
CANDLES and its advocates in their quest to make a significant difference in the lives and well-being of
Samarnons.

Notes on the Study’s Background and Scope

The baseline and this blueprint initially targeted to apply the survey and data gathering instruments to
about nine municipalities in the whole Samar island or about 3 municipalities per province (Northern Samar,
Eastern Samar and Western Samar). However, due to resource constraints encountered by CANDLES, the
study scope was trimmed down to six pilot municipalities in Northern and Eastern Samar. This is without
prejudice to the application of the blueprint to Western Samar.

The following are the identified study areas:

Northern Samar

Lavezares

San Jose

Mondragon
Eastern Samar

Borongan

Mercedes

Guiuan

In the above areas, specific survey instruments administered to several respondents. These are:

1. Households (urban and rural, above the poverty line or “non-poor” and below the poverty live
or “poor”);

2. Municipal local government units and the respective provincial government units (their
development orientation, pro-poor plans, programs and projects, financial and technical
capacities and capabilities, etc.);

iii
 3. Non-government and civil society organizations working in the area or those that have stakes
in Samar;

4. Development financing institutions and microfinance entities (their various portfolios and
financing/lending/credit programs, etc.); and

5. Private sector and small investors (profile of businesses, business constraints and concerns in
their areas, and the potential of overseas Filipinos’ remittances and investments).

The table below shows the detailed profile of the surveyed households. The survey establishes the
baseline situation for the rural and urban households as well as those of the poor and non-poor households.
(Note that the more accurate terms are actually “above the poverty threshold” and “below the poverty
threshold”.) The baseline is for revisiting on the third year and on the sixth year of the implementation of
CANDLES interventions to determine adjustments in the programs and track the initial gains and impacts of
the interventions.

Number of Respondents / Head of Households

Surveyed Areas Urban Rural
Poor Non Poor Total Poor Non Poor Total
Eastern Samar 593 47 55 102 243 248 491
Borongan 330 21 22 43 144 143 287
Guiuan 225 24 29 53 83 89 172
Mercedes 38 2 4 6 16 16 32
Northern Samar 468 36 166 202 207 59 266
Lavezares 157 10 27 37 98 22 120
Mondragon 201 15 115 130 71 0 71
San Jose 110 11 24 35 38 37 75
TOTAL 1061 83 221 304 450 307 757
100% 8% 21% 29% 42% 29% 71%
Notes:
a. 95% confidence level at confidence interval of 4 (sampling range of 1 to 3%)
b. Annual per capita income threshold for Region 8 (Eastern Visayas) is P9,623 or P48,115 a year for a family of 5.
This was used to determine poor and non-poor respondents. Urban and rural annual per capita threshold is P9,969
and P9,562, respectively. [Source: NEDA Region 8, 2000]
c. Urban and rural barangays were determined using National Statistics Office criteria
d. Household survey was administered from undertaken from 8 February to 15 May 2005

The blueprint also benefited from the valuable insights from the spearheading individuals and
organizations of CANDLES who are experienced development practitioners in their own fields of expertise.
The assessments based on their interaction with the major Samar stakeholders from government like
governors, members of congress, mayors, private investors and business and NGOs have, in one way or the
other, found their way into the strategies and plan specifications. Lastly, the major and relevant development
strategies cited in the regional, sector, provincial and local plans and investment programs served as major
guideposts and thus significantly influenced the blueprint’s proposed development paths leading to poverty
reduction and local economic development.

iv
 Chapter

1 Blueprint Framework

“Poor Households and the Enterprising Poor as the Focus of Poverty

Reduction and Development Interventions”

T
he framework that is seen to address poverty through the development of the local economies stems
from the contention that poverty reduction and local economies can happen from the bottom
economic unit so long as development interventions are well-targeted, focused and well-coordinated
with the effects of other interventions. It argues, “Poverty cannot be eradicated solely with the influx of large-
scale foreign investments and revitalization of export industries.” It avers that poverty “can be better
addressed if the development starts at the bottom: from the local economies growing upward to the national
economy”. To do so, “local economies on their own must be able to meet the requisites of production,
employment and services to be self-reliant and self-sufficient.” Thus the character of this blueprint’s
development outlook is one that is: (a) bottom–up, (b) micro-led (less on sector, and not macro-led), (c)
emanating from households- or household-based microenterprises to the community, (d) less dependent on
national government assistance but relies on local government and community/civil society assistance.

This development outlook has theoretical and practical basis. The Framework for Analyzing
Demographic and Socioeconomic Interactions at the Community and Household Level (developed by Dr.
Alejandro Herrin, Training Module on Integrated Population and Development Planning, 1993), illustrates the
relationship between households and the sources of change and factors (in and outside the community) that
influence household decision-making (Figure 1).

Figure 1: Development Framework for Poverty Reduction & Local Economy Development

Basic Framework for Analyzing Socioeconomic and

Demographic Interactions at the Household Level
(Herrin, 1993)

Community
Sources of Agriculture and Household
change/ Natural Resource Decisions
Development Base
Household -savings/
Interventions consumption
Development Structure of -Physical
policies and markets and price assets -investment in
projects for factor inputs physical
-Human
and human
and products capital
capital
Exogenous
-Size, age-
factors gender -labor utilization
Physical, social composition
and economic of members -fertility
infrastructure
-migration
Social Structure Population size
and and age-gender
organization composition
 The model above shows that household decisions are influenced primarily by the socio-economic and
demographic characteristics and circumstances prevalent in the household (physical, human assets, size,
and age-sex composition) and secondarily by the community and external environment. Basic household
decisions -- to save or to consume, to invest in physical capital or in health and/or education of children –
depend on the economic and demographic characteristics of households. Decisions on labor utilization (will
both adults/spouses work, will the children work?), fertility decisions (how many children or what family size
do they want?), shall they move to the city, Manila or seek overseas employment, are all formed by the
presence/absence and/or strength/weaknesses of the cited socio-economic and demographic factors.
Households are likewise the basic units forming the community or the local economy; they are all in one way
or the other and simultaneously: (a) consumers (savers), (b) producers, (c) reproducers, and (d) movers.
The predominant choices of households that form the community or local economy shape the economic and
demographic decisions and characteristics of the community. The whole system still links to the total picture
as the macro-economy and policies on the national economy impacts on the local economy and community.

Above framework is the model used in evaluating if public sector programs and projects (particularly those
that address poverty) are effective in creating positive impact on the household and community levels. The
framework will be the basic guide in building a more detailed framework or model of microfinance and micro-, small,
medium-scale enterprise development, poverty reduction and the development of local economies. This study will
build on the general interrelationships cited in Figure 1 and will move on in detailing the causal links between and
among the pillars of the development of local economies as envisioned by CANDLES.

Figure 2: Linkages and Convergence of the Development Interventions the Five Pillars

Local Economy Development: Five Pillars and their

interactions and interventions
2. Programs/
projects of Community
Development Agriculture and Household/
Financiers/ Natural Resource Microenterprise
Microfinance Base Decisions
Institutions 1. Household- -savings/
Structure of Entrepreneur
consumption
3. LGUs markets and price -Physical assets
interventions for factor inputs -investment in
and products -Human capital physical
and human capital
4. Civil -Size, age-gender
composition of
Society/NGOs members
-labor utilization
Physical, social
interventions and economic -fertility
infrastructure
5. Private -migration
investors/OCW Social Structure Population size
remittances and and age-gender
organization composition
Exogenous
factors

Figure 2 above schematically establishes the linkages and convergence points of the five pillars of poverty
reduction and local economy building. The main convergence point is the first pillar: poor households (who are in
transition as household-entrepreneurs or “enterprising poor” to become a significant pillar or actor in local economy
building). Poor households and the entrepreneurial poor are both objects of development interventions and, at a
certain phase and level of success; they eventually become development models and impetus to poverty reduction
and local economy building in the medium to long term.

As objects of development interventions, development practitioners recognizes that poor households or

those whose incomes fail to meet the poverty threshold or poverty line, need to attain certain levels of social and

2
economic empowerment through public entitlements before they could productively engage in higher-level
economic and social development participation. There are certain prerequisites for the significant participation of the
poor in the development process and these are access to basic needs like food, shelter, clothing, and public
services like health care, formal and informal education, nutrition, potable water supply, irrigation and asset
transfer/entitlements like land reform and agricultural inputs, technology and common service facilities.

The pervasiveness of extreme poverty in the Philippines, however, necessitates multi-faceted interventions if
one were to transform them from subsistence living to one of sustainable income generation. This will require
various interventions starting from welfare provision (minimum basic needs approach and asset transfer) to higher
level and sustainable development interventions (capability building for enhancing/generating employment,
increasing productivity and value-adding economic activities).

Figure 3 below illustrates the development path and phases aimed at addressing extreme poverty and at the
same time instituting interventions among the segment of the poor who are ready to receive, access and, engage in
higher-level interventions made available through the interventions of local governments, civil society, development
financiers, and private investment streams. The poor and entrepreneurial are divided into three population
segments. These are:

a. Poor households who are below, near and slightly above the poverty line whose mode of
economic activity remains predominantly on a subsistence level and may be characterized by low
socio-cultural, organizational, entrepreneurial maturity;

b. The “enterprising” poor households (above the poverty line but whose distance from the threshold
is not yet secure due to proneness to economic cycles) who have attained a level of social/physical
capacity, organizational maturity, and entrepreneurial skills to engage in higher-level economic
production (in contrast to subsistence economy); and

c. The community entrepreneurs or the erstwhile poor or enterprising poor with household-based
enterprises.

Figure 3: Development Phases and Transition Paths

Development Path and Phases

2. Programs/ 1.b. Enterprising poor 1. c++ Community

projects of households Entrepreneurs
Development (sustainably above (employing the
Financiers/ poverty line) subsistence poor
Microfinance in1.a.)
Institutions -Physical assets
-Human capital
-Size, age-gender -Physical assets
composition of members -Human capital
3. LGUs -Size, age-gender
composition of members
interventions

4. Civil
Society/NGOs 1.a. Poor households • basic public &
interventions (below, near & community services
just above poverty • basic infra for poor
line) & the entrepreneurs
5. Private • peace & order
investors/OCW -Physical assets • etc.
remittances -Human capital
-Size, age-gender
composition of members

3
 The poor households living below the poverty line are the targets of interventions mainly (but not exclusively)
emanating from the local governance and civil society streams. The main theme is practically provision of welfare
and public entitlements directed at outcome that will eventually to put them in a situation beyond subsistence and
closer to the second sub-group, the enterprising poor. The enterprising poor, on the other hand, are the main target
beneficiaries of sustainable poverty reduction and local economy development through enterprise development. All
of the five sources of interventions will come into play and converge towards this population sub-group: local
governance, civil society, development financiers, private sector/remittance investments of overseas Filipinos, and
successful entrepreneurs (erstwhile poor) microenterprises willing to share their experience and models.
Convergence among these actors towards the entrepreneurial poor households ensures that they focus on and
harness the major strengths and opportunities open to the target beneficiaries in all sectors of economic activity:
agriculture and fishery, agri-business, rural enterprises, commercial, service and industrial sectors. Therefore, by
the use of the terms “entrepreneurial” or “enterprise development” the model does not limit itself to business, in the
traditional sense of the term.

The outcome of the interventions for population sub-groups 1a and 1b, in a linear causation model, is 1c or
the community entrepreneur. At this population sub-group and given a certain level of growth, sustainable, profit-
generating and value-adding economic activities are attained and the enterprise operations are now employing the
sub-group 1a, the subsistence poor. The framework also recognizes the reality that in certain localities, all three
sub-groups may be present and co-existing. The mix varies from community to community: while the subsistence
poor may predominantly populate some, the community may still have a handful of community entrepreneurs; other
communities may have only a handful of subsistence poor, more of the enterprising poor and insignificant number
of community entrepreneurs. The model thus should not construe a purely linear causation concept. The
disaggregation of the target population intends to calibrate the interventions of the five pillars so that each
population sub-group will receive the appropriate development interventions. The model recognizes that at certain
phases, simultaneous administration of the appropriate interventions to the respective population sub-groups may
be permissible and appropriate. At some other phase, the predominant administration of interventions (programs
and projects) to solely one population sub-group is a better option. The basic criteria are cost efficiency and cost-
effectiveness.

4
 Chapter
Samar, the Philippine
2 Economy and Poverty

Samar’s internal strengths and weaknesses, external opportunities and

threats

Macroeconomic Assessment

Population Size and Growth and Poverty Situation

Samar’s population size and growth rates are below the national averages, exerting relatively lesser
pressure in the demand for public goods and services (Table 2-1). From the point of view of demand attendant to
demographic growth and trends, all things being equal, the island’s total population, size and growth rates are
below the national average and lower compared to other regions, provinces and islands in the country. Samar
provinces are also one of the least densely populated areas in the country.

Table 2-1: Population Data of Samar Provinces, Eastern Visayas Region and Philippines

Population (census-based) Land Area Density

(sq km) (person
2000 % Rank 1995 % Rank s/sq Rank
km)
2000

Philippines 76,498,735 68,616,536 328,214 255

Region 8
Eastern Visayas 3,610,355 5% 3,366,917 5% 21,988 85

Biliran 140,274 4% 75 132,209 4% 72 528 264 53

Eastern
Samar 375,822 10% 59 362,324 11% 58 4,431 84 14

Leyte 1,592,336 44% 15 1,511,251 45% 13 6,520 241 48

Northern
Samar 500,639 14% 50 454,195 13% 51 3,445 145 28
Southern
Leyte 360,160 10% 61 317,565 9 61 1,852 353 62
Western
Samar 641,124 18% 38 589,373 18% 37 5,212 65 10

5
Table 2-2 Annual Average Population Growth Rates and Migration By Sex, Province, Region VIII

Annual Average Growth Rate (in %)

1980-1990 1990-1995 1995-2000
Philippines 2.35 2.32 2.36
Region 8 Eastern Visayas 0.88 1.84 1.51
Biliran - 2.15 1.28
Eastern Samar 0.27 1.8 0.79
Leyte 1.32 1.89 1.13
Northern Samar 0.13 3.21 2.11
Southern Leyte 0.83 -0.26 2.73
Western Samar 0.63 1.87 1.82

Northern and Eastern Samar are net out-migration areas (Table 2-2), an indication that the populace
(particularly females) are in constant search for better opportunities elsewhere because of the pervasiveness of
poverty in the island, especially in the rural areas. Why is there high out-migration? Table 2-3 (and Figures 2-1, 2-2,
2-3) provides a picture of the pervasiveness of poverty particularly in the rural areas of Samar. Thus, the overall
perception particularly in the impoverished rural areas is that there may be social and economic opportunities
abounding in urban areas, in the regional center (Tacloban City), in the major urban capitals and metropolis (Cebu
and Metro Manila), and overseas.

Table 2-3 Poverty Incidence in Samar Provinces Compared to Region VIII and Philippines

Incidence of
Annual Per Capita
Magnitude of Poor Poor
Poverty Threshold 1/
PROVINCE Families 2/ Families 3/
(in Pesos)
(in Percent)
1997 2000 1997 2000 1997 2000
Philippines 9,843 11,605 3,982,766 4,338,780 28.1 28.4
Region VIII 8,319 9,623 299,733 278,486 39.9 37.8
Leyte 8,262 9,790 105,188 122,070 32.9 36.1
Biliran 8,626 10,072 11,877 9,975 39.6 34.8
Southern Leyte 8,194 9,674 31,389 20,856 33.6 28.5
Samar 8,470 9,574 45,140 52,110 41.1 40.7
Eastern Samar 8,577 9,516 51,341 35,067 58.1 47.3

Northern Samar 8,063 9,166 54,799 38,409 49.5 40.7

Table taken from NEDA 8 website

Because poverty is pervasive (rural areas) and there is

6
Figure 2-1 Poverty Incidence in Samar Provinces Compared to National

Poverty Incidence, 2000

100

40.7 47.3 40.7

50 30.6
28.4

0
Philippines E. Visayas N. Samar E. Samar W. Samar

Figure 2-2 Poverty Incidence in Samar: Comparing Incidence and Annual Income Thresholds

Poverty Incidence, 2000

P4,835

100

40.7 47.3 40.7

50 30.6
28.4 <P48,115/yr/hh

<P55,025/yr/hh

0
Philippines E. Visayas N. Samar E. Samar W. Samar

Figure 2-2 specifically highlights the magnitude of poverty incidence in Samar. Despite having a lower
annual income poverty threshold per household of P48,115 in 2000 as compared to the national threshold of
P55,025 per year per household, Samar poverty incidence stood at near the 50 percent mark (40.7 to 47.3%) in
contrast to the national incidence of 28.4 percent and regional incidence of 30.6 percent.

Figure 2-3 highlights the disparity between rural and urban poverty incidence in Samar and the Philippines in
the last census year (2000). Clearly established is that poorest of the poor are located in the rural areas and that
main sources of the exodus to urban areas and cities are the poor rural households.

7
Figure 2-3 Rural and Urban Poverty Incidence

Rural Poverty Incidence, Urban Poverty Incidence,

2000 2000
100

90

80

70

60 53.5
44.9 47
50 41.4 43.7
40 32.4 33.6
30
15 19.6 16.9
20

10

0
Philippines E. Visayas N. Samar E. Samar W. Samar Philippines E. Visayas N. Samar E. Samar W. Samar

Production

The Eastern Visayas Region is a relatively small to an emerging medium-sized economy, ranking and
belonging to the bottom quartile of the Philippines’ sixteen (16) regional groupings (Table 2-4). Among the provinces
in the Eastern Visayas Region, Samar provinces contribute lesser to the regional economy compared to provinces
of Leyte and Southern Leyte. In terms of per capita GRDP, the region falls one rank lower at 14th in relation to the
16 regions of the Philippines with a per capita contribution of only P5,626 compared to the national average of
P12,353.

For the past 15 years, Eastern Visayas’ Gross Regional Domestic Product (GRDP) continued modest
increase even during the sharp decreases in Gross Domestic Product (GDP) at the national level particularly during
the period 1997 to 1998 when the Asian financial crisis occurred. The implication here is that Eastern Visayas’, and
therefore including the Samar provinces, production are less sensitive to the fluctuations in the international/global
markets. On the other hand, this also implies that there is a relatively weaker link between production in the area
and the international competitive market. It is in the latter, however, where higher-value added trading occurs.

Samar’s contribution to the national economy lags behind other regions in terms of agriculture (for traditional
crops, except for coconut) and other sources and measures of production (manufacturing and services). It ranks
12th among 15 regions in terms of agriculture, fishery and forestry sector, 10th among 16 regions for manufacturing
and 11th among 16 regions for the services sector. (See Table 2-5.)

8
Table 2-4 Gross Regional Domestic Product and Per Capita GRDP

Source: NSO 2002 Statistical Year book

Table 2-5 Eastern Visayas Region Contribution Share per Sector

GVA in Agriculture, Fishery & Forestry, GVA in Manufacturing GVA in the Services Sector
constant 1985 prices, in million pesos constant 1985 prices, in million constant 1985 prices, in
pesos million pesos
2001 Rank 2001 Rank 2001 Rank
Philippines 197,736 244,084 454,824
NCR - - 95,822 1 191,195 1
CAR 3,485 15 9,676 7 5,216 14
1 12,626 6 1,563 12 12,968 8
2 11,708 7 671 14 6,931 13
3 22,071 2 27,078 3 32,683 4
4 35,386 1 47,280 2 52,233 2
5 9,206 10 391 16 12,341 9
6 20,552 4 11,228 5 31,389 5
7 9,136 11 14,296 4 38,739 3
8 7,274 12 4,597 10 7,768 11
9 13,885 5 2,360 11 8,882 10
10 10,390 8 9,552 8 15,617 7
11 21,934 3 10,673 6 24,193 6
12 9,258 9 7,152 9 7,367 12
ARMM 5,734 13 412 15 2,547 16
CARAGA 5,091 14 1,333 13 4,755 15

The value of exports and imports by port of origin/destination in the Eastern Visayas Region also indicate
that the there is very minimal trading activities emanating or originating in the Samar provinces (Table 2-6).

9
Table 2-6 Comparative Value of Exports and Imports Among the Major Areas in Eastern Visayas Region

Table taken from NEDA 8 website

Sector Performance

On the overall rapid sector appraisal, including the review of existing development plans in the area, Samar
provinces exhibited modest performance in coconut production and abaca. The other emerging growth sectors
identified in the past five (5) years are aqua and marine culture, corn, root crops, palay production and eco-tourism
potentials. These are the same sectors identified in the various development plans (regional and provincial)
reviewed.

While palay production in Samar provinces falls among the bottom 40 percent of the country’s regions
(Table 2-7), there is still a lot of room for growth or at the very least, achieve 100 percent rice sufficiency. Palay is a
traditional crop and one whose cultivation technology is culturally passed on to the next generation and is familiar to
Filipino farmers in the countryside. It is therefore difficult to recommend for its downplaying or much worst, its phase
out in the scheme of development.

In Region VIII, the palay area is 228,521 hectares with only about 45 percent irrigated, rain-fed accounts for
54 percent and 1 percent belonging to upland rice. Productivity is about 3.67 metric tons per hectare (from the
earlier productivity of 2.8 metric tons in the mid 1990s). Regional rice sufficiency is 97 percent and there are enough
bases given the resources to achieve a 100 percent rice sufficiency level.

Eastern Samar’s production in corn in 2000 falls within the top 40 provinces in the country (Table 2-7). In
fact, it topped (ranked 1) the growth rate of corn production from 1999 to 2000. Corn sufficiency in the region is 94
percent.

10
Table 2-7 Palay and Corn Production

Palay Production Corn Production

Per capita
2000 Growth 2000 Growth
MT Ra Rate Rate fr
Metric Tons % Rank nk fr '99 Rank Metric Tons % Rank '99 Rank
Philippines 12,389,412 16.2 5.1 4,511,104
Region 8 Eastern Visayas 517,558 4% 46,306 1%
Biliran 53,375 10% 53 38.1 13 4.3 34 695 2% 65 7.8 22
Eastern Samar 26,796 5% 65 7.1 61 8.2 25 31,435 68% 27 44,807.1 1
Leyte 282,160 55% 13 17.7 31 3.7 37 4,589 10% 49 -84.9 74
Northern Samar 48,882 9% 56 9.8 55 -5.7 61 5,770 12% 46 2.6 33
Southern Leyte 50,633 10% 54 14.1 38 0 48 75 0% 73 -98.3 75
Western Samar 55,712 11% 50 8.7 57 -0.3 50 3,742 8% 51 -20.8 63

Banana production in Western Samar accounts for about a fourth of the Region’s production (together with
Leyte) and is second to Southern Leyte in terms of overall contribution to the Region (Table 2-8). Banana
production in the province ranks 30th compared to the other provinces nationwide. Overall, Western Samar and to a
much lesser extent, Northern Samar, can play secondary role in banana production in the Region.

Coconut production in Samar provinces falls within the top 20 provinces in the country. However, growth
rates in coconut production from 1999 to 2001 had been negative or zero for the three Samar provinces (Table 2-8).

Table 2-8 Banana and Coconut Production

Banana Production Coconut Production

2000 Growth 2000 Growth
rate fr rate fr
'99 '99
Metric Tons % Rank Rank Metric Tons % Rank Rank
Philippines 4,155,668 7.4 12,499,097,767
Region 8 Eastern Visayas 138,924 3% 1,544,811,558 12%
Biliran 13,094 9% 39 -2.8 63 33,166,768 2% 50 14.3 11
Eastern Samar 4,238 3% 58 0.4 51 229,090,420 15% 15 0 51
Leyte 32,083 23% 29 3.6 31 660,490,459 43% 5 0 52
Northern Samar 7,946 6% 46 0.3 53 214,063,126 14% 18 -3.8 62
Southern Leyte 50,086 36% 18 28.7 7 109,242,578 7% 36 0.5 48
Western Samar 31,477 23% 30 -0.4 57 298,758,207 19% 13 -9 58

Fish production is a dominant economic activity in Western Samar. Among the provinces in the
country, fish production in Western Samar ranks 24th in 1999-2000 (Table 2-9). Fish production in Eastern
Samar ranked 53rd, while Northern Samar ranked 55th during the same period. Marine culture or
“mariculture” accounted for 86.6 percent of total aquaculture production in Eastern Visayas region (2004).
The growth rate of mariculture in 2004 was 25.3 percent; the biggest increase was in bangus production in
fish cages while seaweeds production had the highest proportion.

11
Table 2-9 Fish Production

Fish Production (in metric tons)

2000 Growth
rate fr
Aquaculture Commercial Municipal Total % Rank '99 Rank

Philippines 1,044,433 946,485 945,945 2,936,863 2.1

Region 8 Eastern Visayas 74,829 3%
Biliran - 2,637 1,025 3,662 5% 57 4 47
Eastern Samar 126 1,438 4,817 6,381 9% 53 10.1 29
Leyte 1,175 18,810 6,608 26,593 36% 23 7.8 36
Northern Samar 34 961 4,417 5,412 7% 55 -4 68
Southern Leyte 65 1,801 4,559 6,425 9% 52 -0.9 61
Western Samar 3,017 6,850 16,489 26,356 35% 24 -0.3 60

Infrastructure, Establishments and Housing

The lack of basic public infrastructure remains one of the foremost hindrances to development in the island
of Samar. Roads and bridges, power and electricity, ports, irrigation, potable water supply systems,
telecommunications and other common service and economic facilities and infrastructure are wanting throughout
the whole of Samar, particularly in rural areas and areas outside the provincial capitals or city. The availability of
and quality of service of the facilities that are currently in place also pale in comparison to regional and national
averages or standards.

Roads

Road densities in the provinces of Samar are the lowest in the Eastern Visayas region and these are
below the national average. A visual inspection of the road map below will further show the inadequacy of road
access to major capitals and market centers from the production areas and vice versa. Contrast this to the relative
spread of the road network in the other provinces of Eastern Visayas region.

Table 2-10 Road Density

12
Figure 2-4 Eastern Visayas Region Transport Map

Figure taken from NEDA 8 website

Table 2-11 shows the relative length of roads and the surface type among different provinces in
Region 8. The province of Eastern Samar ranks poorly at 73rd in terms of the total length of concrete
national roads. About 36 percent (or 114 kms) of the total length of Eastern Samar’s national roads is still
with gravel type surface. Fifty-one percent (51%) of Northern‘s Samar’s total length of national roads is
likewise of gravel type.

13
Table 2-11 Road Length and Surface

Length of National Roads (in kilometers), 2000

Concrete Asphalt Gravel Earth Total
Length % Rank Length % Length % Length %

Philippines 10,611.26 35.70 6,636.47 22.30 11,875.18 39.90 609.95 2.10 29,732.85
Region 8 Eastern Visayas
Biliran 43.11 33 37 - 0 87.67 67 - 0 130.78
Eastern Samar 21.34 6.8 73 176.41 56.6 114 36.6 - 0 311.75
Leyte 562.08 58.8 14 30.56 3.2 333.83 34.9 29.58 3.1 956.05
Northern Samar 132.83 45.6 24 4.75 1.6 150.51 51.6 3.37 1.2 291.45
Southern Leyte 144.58 51.1 19 - 0 133.44 47.1 5.16 1.8 283.18
Western Samar 299.78 84.8 1 11.7 3.3 41.95 11.9 - 0 353.42

Irrigation

The provinces of Samar suffer from the lowest percentage of irrigation development among the
provinces in the region as well as in relation to the total percentage of irrigation development at both the
regional and national levels. Only 13 percent of the total irrigable area in Eastern Samar is with irrigation, 16
percent in Western Samar and 19 percent in Northern Samar. The presence of efficient and adequate
irrigation facilities have a direct bearing on agricultural productivity. The low level of irrigation development in
the three Samar provinces greatly explains the low levels of agricultural productivity particularly for traditional
crops.

Table 2-12 Status of Irrigation Development by Province/Type, As of September 2003

14
Electrification

A considerable number of potential barangays for electrification are without energy and still wanting
of services due from electric cooperatives. Only 77 percent of barangays in Eastern Samar and only 63
percent of potential barangays in Northern Samar in 2003 have electric cooperative services.

Table 2-13 Number of Municipalities and Barangays Energized by Electric Cooperative, 1997-2003
Electric Cooperative Potential 1997 1998 1999 2000 2001 2002 2003
Barangays
Region VIII
Municipalities 143 143 143 143 143 143 143
Barangays 4,389 2,343 2,412 2,912 2,921 3,043 3,228 3,618
ESAMELCO
Municipalities 23 23 23 23 23 23 23
Barangays 596 119 128 316 327 331 352 458
NORSAMELCO
Municipalities 24 24 24 24 24 24 24
Barangays 569 176 179 211 229 244 270 356

Kerosene remains to be the source of illumination of the majority of the households in occupied
dwelling units in both Eastern and Northern Samar in 2000. The use of electricity for lighting constitutes only
33 percent of dwelling units of households in Northern Samar, while 43 percent is the corresponding
proportion for Eastern Samar.

Table 2-14 Number of Households in Occupied Dwelling Units by Kind of Lighting Used and Province/City, Urban-
Rural, Census Years 1990 and 2000

1990
Province/City/Kind of Lighting Used Total Urban Rural 2000
Eastern Samar 60,720 23,118 37,602 73,032
Electricity 8,000 5,974 2,026 31,748
Kerosene 47,993 15,962 32,031 37,528
Liquified Petroleum Gas (LPG) 4,388 1,112 3,276 928
Oil 19 - 19 346
Others 320 70 250 2,482
Northern Samar 72,365 24,568 47,797 94,410
Electricity 8,152 6,119 1,953 31,619
Kerosene 58,906 17,417 41,489 57,516
Liquified Petroleum Gas (LPG) 4,882 868 4,014 2,686
Oil 170 52 118 392
Others 255 32 223 2,197

Number of Establishments

Most of the establishments in Eastern and Northern Samar belong to the Wholesale and Retail
Industry, Manufacturing and Personal Services. Hotels and restaurant establishments outnumber Personal
Services in Northern Samar while the same are close fourth in Eastern Samar.

15
Table 2-15 Number of Establishments By Major Industry Division and Province, 1997-2002

Province/ Major Industry Division 1997 1998 1999 2000 2001 2002
Region VIII 21,966 22,099 21,794 21,399 21,153 21,103
Agriculture, Hunting and Forestry 99 101 119 106 100 96
Fishery 69 69 107 90 85 84
Mining and Quarrying 4 4 1 2 2 2
Manufacturing 4,109 4,109 3,803 3,698 3,641 3,634
Electricity, Gas and Water 69 73 102 62 66 67
Construction 120 126 108 80 72 72
Wholesale and Retail Trade 11,696 11,792 11,869 11,860 11,799 11,776
Hotels and Restaurants 1,800 1,804 1,937 1,906 1,894 1,892
Transport, Storage & 966 973 786 611 595 581
Communication
Financial Intermediation 403 403 391 428 411 424
Real Estate, Renting & Business 706 714 621 632 597 588
Services
Education 156 160 199 207 202 201
Health and Social Work 332 332 403 387 382 382
Other Community, Social & 1,437 1,439 1,348 1,330 1,307 1,304
Personal Services
Eastern Samar … … 1,970 1,974 1,942 1,936
Agriculture, Hunting and Forestry … … 5 5 6 5
Fishery … … 2 4 4 4
Mining and Quarrying … … - - - -
Manufacturing … … 355 353 347 347
Electricity, Gas and Water … … 8 6 4 4
Construction … … 6 6 6 6
Wholesale and Retail Trade … … 974 983 974 973
Hotels and Restaurants … … 115 114 113 113
Transport, Storage & 69 45 43 40
Communication
Financial Intermediation … … 36 67 60 60
Real Estate, Renting & Business … … 56 55 50 50
Services
Education … … 28 26 25 25
Health and Social Work … … 47 42 42 42
Other Community, Social & … … 269 268 268 267
Personal Services
Northern Samar … … 2,669 2,511 2,499 2,492
Agriculture, Hunting and Forestry … … 4 2 1 1
Fishery … … 4 4 4 4
Mining and Quarrying … … - - - -
Manufacturing … … 356 324 319 319
Electricity, Gas and Water … … 8 6 11 11
Construction … … 5 4 3 3
Wholesale and Retail Trade … … 1,682 1,601 1,596 1,592
Hotels and Restaurants … … 186 178 177 176
Transport, Storage & 139 118 118 117
Communication
Financial Intermediation … … 22 24 24 24
Real Estate, Renting & Business … … 60 62 62 61
Services
Education … … 21 22 21 21
Health and Social Work … … 41 38 37 37
Other Community, Social & … … 141 128 126 126
Personal Services

Housing

Walls made of Bamboo/Sawali/Cogon/Nipa reinforced majority or about 46 percent of total

occupied housing units in both Eastern and Northern Samar in 2000. Seventy- one percent (71%) of the
occupied housing units in Northern Samar were made of Cogon/Nipa/Anahaw while about 52 percent was
the proportion in Eastern Samar in same year.

16
Table 2-16 Number Of Occupied Housing Units By Construction Materials Of Roof And Outerwalls And
Province/City, Census Year 2000
Total Type of Roof
Occupied Galvanized Tile/ Half Wood Cogon/Nipa Make-shift/ Asbestos/ Not
Province/Type of Outer Housing Iron/ Concrete Galvaniz /Anahaw Salvaged/ Others Reported
Walls Units Aluminum / Clay ed Iron improvised
Tile and Half
Concrete
Eastern Samar 72,600 30,849 245 2,076 633 37,800 107 162 728
Concrete/Brick/Stone 10,323 9,614 83 147 17 448 1 13 -
Wood 15,992 10,099 63 388 408 4,997 8 29 -
Half Concrete/Brick/
9,377 7,158 40 1,079 47 1,027 3 23 -
Stone & Half Wood
Galvanized Iron/
483 246 5 54 15 160 2 1 -
Aluminum
Bamboo/Sawali/
34,286 3,200 - 374 131 30,515 29 37 -
Cogon/Nipa
Makeshift/Salvaged/
306 72 - 4 3 165 60 2 -
Improvised
Asbestos 140 78 39 6 5 - - 12 -
Glass 12 5 5 2 - - - - -
Others/Not Reported 1,596 331 8 21 6 458 2 42 728
No Walls 85 46 2 1 1 30 2 3 -
Northern Samar 93,332 20,981 328 2,496 1,175 66,512 292 330 1,218
Concrete/Brick/Stone 11,655 8,841 182 251 23 2,330 5 23 -
Wood 25,294 6,591 58 550 657 17,319 36 83 -
Half Concrete/Brick/
9,583 4,168 55 1,357 40 3,916 12 35 -
Stone & Half Wood
Galvanized Iron/
312 119 8 39 20 121 4 1 -
Aluminum
Bamboo/Sawali/
43,610 1,073 - 269 412 41,670 72 112 2
Cogon/Nipa
Makeshift/Salvaged/
684 38 - 2 2 470 159 13 -
Improvised
Asbestos 57 23 18 4 3 - - 9 -
Glass 11 3 4 2 - - - 2 -
Others/Not Reported 2,080 105 3 21 17 664 3 51 1,216
No Walls 46 20 - 1 1 22 1 1 -

A small percentage of the total housing units in both Eastern and Northern Samar have household
appliances and other home conveniences in 2000. Most of these conveniences are radios (94 to 95%); a far
second are with television sets (25 to 30%).

Table 2-17 Number Of Households In Occupied Dwelling Units With Household Appliances/Conveniences
And Province/City, Urban-Rural, Census Years 1990 And 2000
Province/City 1990
Type of Appliances/Conveniences Total Urban Rural 2000
Eastern Samar 31,679 16,178 15,501 42,985
Radio/Radio Cassette 26,218 11,976 14,242 40,611
Television 1,179 977 202 12,748
Video Cassette/Recorder .. .. .. 6,322
Refrigerator/Freezer 1,959 1,646 313 9,400
Telephone/Cellphone 107 80 27 1,250
Washing Machine .. .. .. 4,018
Motor Vehicle 2,216 1,499 717 4,651
Northern Samar 36,416 17,799 18,617 56,453
Radio/Radio Cassette 31,022 13,534 17,488 53,968
Television 999 817 182 14,373
Video Cassette/Recorder .. .. .. 7,280
Refrigerator/Freezer 2,027 1,703 324 11,283
Telephone/Cellphone 264 232 32 668
Washing Machine .. .. .. 4,243
Motor Vehicle 2,104 1,513 591 5,741

17
Agrarian Reform

Agrarian reform remains for completion in the Eastern Visayas region. About 47,368 of prime private
agricultural lands remain for distribution as of December 2004. Quality of ownership remains low with the low and
slow rate of individual titling. There are also incidences of land conversion and/or significant number of idle lands
due to the lack of irrigation facilities and development support to agrarian reform beneficiaries (ARBs).

Table 2-18 DAR's Land Distribution Accomplishment

(Area in Hectares)
1972 - December 2004

Region Scope Accomp. %

Philippines*_/ 4,290,453 3,513,339 82

CAR 77,856 81,466 104

I 140,340 121,587 87

II 300,055 309,982 103

III 405,290 375,689 93

IV-A 204,818 138,076 67

IV-B 170,817 140,240 82

V 453,769 234,596 52

VI 559,688 320,657 57

VII 166,802 116,468 70

VIII 385,505 338,137 88

IX 158,469 182,161 115

X 269,799 255,247 95

XI 202,279 194,992 96

XII 431,035 401,534 93

CARAGA 200,262 186,532 93

ARMM 163,669 115,975 71

*_/ includes 2 ARMM Provinces (Basilan & Lanao Sur) w/c are still part of
DLR's CARP scope

18
External Environment

The assessment of the external environment of Samar refers to the opportunities and threats that
influence, positively or negatively, the planned development interventions in the area. The opportunities and threats,
being external and exogenous to Samar, are essentially beyond the control of the planning area. However, the
internal strengths can be strengthened and internal weaknesses minimized to mitigate the threats and take
advantage of the opportunities posed by the external environment.

Opportunities

Based on the analysis in the various plans formulated for Samar and its provinces, the following are the
overall opportunities posed by the external environment:

1. The avowed priority of the National Government to administer to poverty-stricken areas poses as an
opportunity for Samar. Poverty alleviation remains an expressed priority of the national government
and its line agencies and instrumentalities. The Medium-Term Philippine Development Plan, the
Regional Development Plan of Eastern Visayas Region (Region 8) and the official plans of
government prioritize poverty alleviation as key features and guiding criteria in the design and
implementation of various programs and projects. The impact on poverty is a major frame and
criterion in the programming of public expenditures and prioritization of public investments. This
recognition by the public sector poses as an opportunity for Samar to assert its claim on national
government resources due to poverty alleviation.

2. National government, the official development assistance (ODA) community and international
development NGO assistance or aid have recognized the need to assist & develop certain sectors of
Samar’s economy particularly in the areas of coastal resource management, coconut production & its
by-products, aqua culture, eco-tourism, disaster management and other integrated area development
concerns. In the past decade, Samar has been a recipient of several development assistances and
the same

3. There has been increasing private investments and/or intentions/manifestations to invest in Samar
particularly in certain agricultural products (coconut, seaweeds), eco-tourism brought about by the
“spill-over” of nearly saturated markets of Leyte and Central Visayas.

Threats

Assessments of the development situation in Samar perennially refer to specific threats. The following are
the major threats that need mitigation and management to allow local economy building to proceed:

1. The whole of Samar island, particularly Eastern and some municipalities in Northern Samar, continue
to be threatened by natural calamities particularly typhoons and is vulnerable to their attendant
effects due to deforestation and denudation:

• The general area of Eastern Visayas with Samar island at its heart is frequently visited by
typhoons yearly, in some years the number reaches 25;

• The situation is aggravated by the continuing decline of the island’s forest cover: from 920,913
hectares of forest to 460,548 – below 40% acceptable standard and from 26,300 hectares of
mangrove areas in 1988 to only 6,000 hectares in 2003;
2. While Samar remains a priority in poverty reduction, other provinces like those in ARMM and CAR
regions have worse levels of poverty and thereby compete with the already scarce development
resources of the national government.

3. Peace and order, including the insurgency in the countrysides, continue to rage and linger in Samar
island.

19
 Chapter
Community and Household
3 Assessment

C
hapter 3 discusses two sections: (a) spatial and community assessment of the pilot areas and (b)
characteristics of the households. Discussions on the characteristics of the pilot communities focus on their
spatial and development roles in relation to their respective provinces. On the other hand, the discussion on
the characteristics of the households will focus specifically on the socio-economic variables gathered from the
household survey conducted in the pilot communities.

As cited in the framework in Chapter 1, relevant and effective local economy building interventions stem
from a good understanding of the development circumstances of the households and the spatial and development
characteristics of the communities they occupy. This chapter will delve into the two variables focusing on the
strengths, weaknesses, opportunities and threats analysis. The results will greatly shed light on the major contours
of the blueprint for developing the local economies, as these will identify the major entry and/or congruence points
between and among the five pillars.

In discussing pilot communities and households, this chapter refers to the following study areas:

1. Northern Samar and the municipalities of Lavezares, Mondragon and San Jose, and
2. Eastern Samar and the municipalities of Borongan, Guiuan and Mercedes

Spatial Characteristics of the Pilot Communities

The following section is an assessment of the spatial and community characteristics of the study areas.
The assessment draws on the analysis cited in the respective provincial physical framework plans (PPFPs) of the
three provinces. The PPFPs provide the overall spatial development framework of the provinces in relation to their
respective strengths, weaknesses, opportunities and threats (SWOT) and works on the past, current, and future
developmental and spatial trends. PPFPs guide the local planners in the overall direction of development –
population, settlements and built-up areas, agro-industrial zones and other production areas, protected areas and
the configuration of public infrastructure given the settlement, production and protection configuration.

The consideration of the PPFPs in configuring the prototype development blueprints of the study areas is
necessary to have consistent interventions that complements and makes use of planned or in-place public
investments in the affected communities. The PPFPs provide specific spatial and development roles for each
municipality and/or clusters of municipalities that supports the overall provincial spatial framework. The PPFPs, in
turn, are consistent with the overall policies cited in the Regional Physical Framework Plan (RPFP). The
municipalities are tasked to formulate their comprehensive land use plans that substantially conforms and
consistent with the PPFPs and RPFP.

Internal Strengths and Weaknesses:

1. In Eastern Samar, Borongan (capital) and Guiuan (eco-tourism & trading center of the southern portion)
possess stronger attraction to private investors. These municipalities are characterized by the following
attributes:

• relative accessibility
• higher level of infrastructure already in place
• rich natural resources/endowments
• high tourism potential

20
 Figure 3-1 Eastern Visayas and the location of Borongan, Guiuan
and Mercedes
The Eastern Visayas PPFP
identifies the municipality of Borongan (the
provincial capital) as the major settlement
area of the province. This means that
institutional (private and public), agro-
industrial, commercial and financial
establishments that serve the needs of the
population are expected to conglomerate
in Borongan.

The municipality of Borongan

possesses a relatively higher infrastructure
base that is conducive to investments.
Expectations are high in the continued
improvement in its infrastructure base,
particularly in the areas of physical access,
communication services, power and other
facilities to support the built-up areas that
Study Areas will also mutually benefit the surrounding
towns.

On the other end of the province,

the municipality of Guiuan serves as the
trading center of the southern portion of
the province. The Guiuan-Mercedes
corridor may benefit from the identified
Guiuan Industrial Estate. (Mercedes was
formerly a part of Guiuan.) Guiuan has
high tourism potential owing to its rich
natural and coastal resources, not to
mention its historical significance. The
PPFP and the municipal development
plan of the town cite these development
contours and potentials well.

In terms of integration with the

regional economy, the identified study
areas are relatively accessible by road
transport on the way to the Regional
Center, which is Tacloban City (hosting
the regional airport). Quality of access is
quite good owing to the newly constructed
(or currently undergoing reconstruction) national highway from Tacloban going to Eastern Samar. Current transport
services and the quality of access have improved tremendously compared to the conditions in the last three years.

Spatially, Borongan being the provincial capital and the major settlement and built-up center, can stand
alone in relation to its development path. In other words, a “do-nothing” scenario for Borongan will still see the area
developing into the role cut out for it in the PPFP. On the other hand, Guiuan is an emerging development area
endowed with natural attractions that are conducive to the inflow of external development and investment
resources. However, Guiuan and more so, Mercedes, compared to Borongan will have to rely on more pro-active
development interventions to start and fully realize its spatial development roles.

Local economy development, as envisage by CANDLES, will not affect the spatial development scenario
for the pilot areas nor the other municipalities. On the contrary, the blueprint for local economy development will
work on the spatial roles laid out for the said pilot areas and complement the development efforts already in place.

21
2. In the province of Northern Samar, the municipality of San Jose accounts for relatively high agro-industrial
and eco-tourism potential and is the area with most exposure to NGO-LGU collaboration in a variety of
sectoral development efforts (i.e., microfinance, women, coastal resource management, etc.). The
municipality of Mondragon’s strength lies in its proximity to the provincial capital (Catarman) and is rich in
agricultural and fishery resource potential and/or endowments. It has ready access to technology with
nearby University of Eastern Philippines (UEP). Lavezares is a tourism center in the western corridor of
the province and serves as transshipment or take-off point to the island tourist attraction of Biri.

N. Samar Study Areas

S = Settlement
= Erosion/Hazard areas

The municipality of Mondragon, being the nearest to Catarman, is spatially planned as a minor
settlement and urban center. It accessible and near the provincial capital and poised to absorb the
population spillover of Catarman. Catarman hosts a major airport is thereby relatively integrated to the
major markets of Manila, Cebu, Davao and other markets that have access to air travel.

Marine and fishery/aquamarine-based potentials are significantly present in the coastal areas of
San Jose and nearby municipalities. There are marine-based entrepreneurial activities in the area and
potentials for expansion to include more participants from the poor and enterprising poor households are
not remote possibilities.

The municipality of Lavezares, in addition to its coastal resource, serves as an eco-tourism hub
of the western portion of the province. The PPFP identifies this spatial role for the municipality being
proximate to the island attractions (i.e., rock formations) of Biri (which by itself is a municipality of interest).

Major spatial weaknesses of the identified pilot or study areas pertain to the moderate to severe
erosion and siltation in upland areas that affect the lowland and downstream areas of Mondragon,
Lavezares and San Jose. The upland and forest areas in the municipalities of Silvino Lobos and Lope de
Vega suffer from declining forest cover and deforestation (due to illegal logging) making the affected areas
mid and downstream vulnerable to the effects of these hazards. Integrated spatial planning is thus
necessary to fully harness and preserve whatever gains resulting from the above-mentioned strengths of
the municipalities.

22
 3. The identified pilot communities have comparative advantages in varying degrees in the following
products or sectors:

• Seaweeds and corn (starting year 2000) in all the pilot Eastern Samar municipalities

• Coconut and its by-products in all the pilot municipalities with particular dominance of Northern
Samar areas

• Abaca and root crops in the pilot areas in Northern Samar

• Fish, marine and aquaculture in all the provinces (including Western Samar)

• Eco-tourism potentials in specific spots in the pilot municipalities

4. There are certain spatial weaknesses particularly for Mercedes and Guiuan. The proximity of the two
municipalities to each other and the gravitation of the market to Guiuan cause the relegation of Mercedes
to play supportive although complementary role to Guiuan. Mercedes used to be part of Guiuan and with
the proactive development initiatives directed at Guiuan as the host of the industrial estate will spatially
make this the central hub where economic activities gravitate around it.

5. In all the pilot municipalities, except probably to a lesser degree for Borongan, the absence or inadequacy
of basic infrastructure conducive to higher-value investments hamper the influx of private investments and
businesses. The following are the most frequent factors cited in documented plans and/or results and
responses from rapid appraisals conducted among stakeholders and informed sources in the areas:

• Concrete access roads linking production areas to markets

• Steady, reliable and adequate supply of electricity

• Communication facilities

• Air and seaports

• Irrigation

• Common service facilities for production and post-production and processing

External Opportunities and Threats:

The following are the opportunities that may significantly contribute in harnessing the full spatial
development potential in the pilot communities and nearby influenced areas:

1. Foreign-assisted projects (FAPs) implemented through national line agencies and programs/projects of
regular government agencies that have features complementing local community and economic
development efforts are present in the pilot and nearby areas:

a. Various official development assistance (ODA) or foreign-assisted projects (FAPs) implemented

by national line agencies (i.e., DA, DAR, DENR, BFAR, NIA, DPWH, etc.) and LGUs provide
opportunities that can support local economic and community development efforts in Samar.
Investment interventions of these FAPs that complement major elements of the local economy-
building model can converge in pilot areas and/or interface with the planned local development
activities of any of the five pillars of local economy. These may be in the areas of coastal-based
resource management, local capability building, infrastructure, support to agrarian reform

23
 communities, agricultural productivity enhancement, local infrastructure, microfinance and credit,
community and institutional development, local capability building, gender, environmental
protection and natural resource management, etc. Most FAPs are loans by the national
government and a significant number of them are for vital rural infrastructure and big-ticket public
investments that should be judiciously used and invested in poverty-stricken areas.

b. DTI and other specialized agencies’ programs on the development of products provide
opportunities for developing the products of each town where they my have competitive and
comparative advantages in production and marketing.

c. DOT programs on development of tourism and promotion of certain areas of interest in Samar
as tourist destinations augurs well for the pilot areas and the environs. Guiuan and the island
municipality of Biri are featured tourism areas in DOT plans and programs in the whole island of
Samar.

2. The presence of international and national/regional/local NGOs that focus on the advocacy of specific
sectors or promotion/protection of products of the communities abound in Samar. These are in the areas
of: environment, biodiversity, political, and advocacy NGOs, agriculture, livelihood, rural development,
population management, family planning and children’s welfare, persons displaced by war, microfinance,
women and reproductive health, etc. Their presence is a development opportunity that positively and
productively trained towards local economy building not only in the pilot areas but in the whole island as
well.

3. Initiatives at the national level pose as opportunities to advance local economy building initiatives like:

a. Establishment of economic zones (San Jose, Guiuan) by the Philippine Economic Zone
Authority (PEZA), given certain conditions, may pose as opportunities in as far as improving
access to and from the areas and other related positive developmental outcomes (i.e.,
improvement in power and other utilities, etc.);

b. Samar Island Bioversity Project protecting the remaining forest of Northern Samar;

c. Bill proposing the establishment of an eco-tourism zone in Northern Samar

The following are some of the external threats that exist:

1. Eastern Samar and to some extent Northern Samar municipalities are always prone to natural disasters
such as typhoons;

2. In Northern Samar, the pilot municipalities are prone to flash flooding, soil erosion and other geological
hazards due in part to forest denudation;

3. There is continuing degradation of marine areas and depletion of biodiversity due to over harvesting,
illegal methods of fishing and uncontrolled extraction of coral rocks in Northern Samar;

4. There is also a monopoly of certain economic and business activities (i.e., abaca in Northern Samar) that
may discourage and pose a threat or “barrier” to the entry of competitive investors in the local economies
of the communities

24
Socioeconomic Assessment of the Surveyed Households

Internal Strengths and Weaknesses:

Demography

1. There is potential clientele in the pilot areas that follows the pattern of successful microfinance
and enterprise development: women-clientele and/or presence of joint household decision-
making has increasingly participated in by the female household member or more members of
the extended households.

a. Seventy-one percent (71%) of the heads of households in the pilot areas who agreed
to be interviewed and reveal vital household information were female;

b. There is increasing roles of women particularly in income generation and

augmentation efforts of the households;

c. Females (and/or both heads of households) dominate expenditure decisions;

d. The productive age range of the decision-makers is from 31 to 50 years old (modal
age brackets).

25
 2. Average household size is 5.7 members and is higher than the regional average. There is a
large and extended household in the pilot areas, implying higher household needs and
expenses.

3. The typical household is composed of young, school-going age: average age of oldest (or the
3rd member) is 20 and while the 5th member if 15 years old. This implies high dependency –
more young persons are dependent on adults. This also is indicative of the close age spacing
of children.

4. The last members of the households (extended family member) are older, often out of work,
retired or are senior age levels.

5. Only 22 percent of the household members interviewed reached or finished college level.

Educational Level No %
Age Range No %
Less than or College 232 22%
equal to 20 12 1%
High School 386 36%
Elementary 397 37%
21 to 30 149 14%
Vocational 9 1%
31 to 40 274 26% NA 37 3%
1061 100%

41 to 50 272 26%
Status No %

51 to 60 179 17% Married 971 92%

Single 24 2%
61 above 166 16% Separated 7 1%
No Widowed 54 5%
response 9 1%
Blank 5 0.47%
1061 100%
1061

Income

1. Using income as a measure of the “entrepreneurial” poor clientele, there are potential entrepreneurial
households in the non-poor groups in both provinces.∗ Average annual income (for the first income
source) of the non-poor group is P101,614. Northern Samar households in the pilot areas have higher
average of P149,018 and Eastern Samar households have P62,110.

∗
Potential entrepreneurial poor is loosely defined here as those slightly above the poverty threshold (and are
therefore “non-poor”). Income level is one major determinant of a household’s ability or propensity to be
“entrepreneurial” (in contrast to “subsistence”) although it is definitely not the only measure. There may be
households whose incomes are at subsistence levels but may become entrepreneurial or have the “entrepreneurial
spirit”.

26
 2. The depth of poverty (distance away from the regional poverty threshold of P48,115 a year) is high (or
“very deep”). The average first and regular income source of about 75 percent of the respondents from
the poor group is P30,636 and is only 63 percent of the poverty threshold. Eastern Samar’s poor are
deepest or farthest from the threshold with only an average P26,726 a year. Northern Samar’s poor are
slightly better off with P34,546 a year.

3. Considering the average income of the households of up to the second and third sources, the potential for
a more entrepreneurial clientele is enhanced. These are in the following areas: (a) Borongan (urban, non-
poor group) in Eastern Samar, (b) Mondragon (urban, non-poor group) in Northern Samar. Secondary
areas are the rural, non-poor groups in San Jose and rural and urban, non-poor groups in Lavezares,
Northern Samar.

4. Even if one considers the average of the second and third income sources of the poor group, all (except
for one) of the areas in both provinces fall short of the income needed to effectively distance themselves
from the poverty line to “qualify” (again, this is based on income levels) as potential enterprising poor.
Except for those from the San Jose urban poor group, the rest of the groups are likely to be in
“subsistence” or day-to-day mode of economic survival rather than on an enterprise frame. This connotes
that, based on the income criteria, most of the poor households surveyed are at subsistence income
levels that is more often than not, less pre-occupied with entrepreneurial motivations and more on
subsistence living.

Other Pertinent Factors

1. Savings pattern – Of the households surveyed, 59 percent in Eastern Samar and 47 percent in Northern
Samar set aside fixed amount from their regular monthly income as savings.

2. Purposes of saving – Fifty-four percent (54%) save for food, education and housing expenses and other
necessities that will occur in the future and very few save for investments and other productive
investments.

3. Real properties – Eighty-six percent (86%) have at least one real property whose average fair market
value is estimated at about P114,346. These properties are typically house and lot and/or agricultural lots.
The average age of these properties from the time of acquisition or possession is 17 years.

4. Secondary properties – Only 28 percent reported ownership of second real properties and most of these
are farmlands planted to rice, corn, coconut, and other crops with an average value of P155,403.

5. Agrarian reform – Only 3 percent of the total respondents reported that they benefited from agrarian
reform. The average land holding distributed is 1.5 hectares.

6. Personal properties – Only 58 percent reported ownership of personal properties dominated by

appliances and a far second is ownership of small vehicles and work animals.

External Opportunities and Threats:

There are certain opportunities and threats emerging from the survey. The dominant ones are:

1. There are consistent identification of certain microfinance institutions and NGOs by respondents in both
provinces, in both rural and urban, and poor and non-poor groups who helped them in their various
financial needs. The needs frequently identified are the following: financing for livelihood, food and basic
services, emergencies, (financing for) copra trading/buying, purchase of small vehicles, buy and sell, sari-
sari store operations, etc. This is indicative of two opportunities: (a) there is a demand for microfinance

27
 services, and (b) there are microfinance providers that have working experiences in providing credit that
can provide information on what works best (and what does not) among Samarnons.

2. Government and/or government-owned and/or controlled corporations and financing entities like GSIS,
SSS and LBP have existing engagements with both the poor and non-poor groups particularly among the
salaried household members. These are the teachers, government employees including mostly barangay
and LGU officials and employees, other salaried employees.

3. Very little help from government and NGO entities in terms of support system in helping the households
save (only 5 percent of respondents said they got some form of assistance to enable them to consciously
save) and most of them relied support from their relatives.

4. A considerable number of the respondents identified informal private lenders as a source of credit
particularly in times of need. Private lenders comprised 20 percent of the total source of credit in Northern
Samar and 11 percent in Eastern Samar.

Households in the Pilot Communities: Findings and Insights

Two Major Characteristics

The households in the pilot communities surveyed exhibit two major characteristics. First, significant
segments of them are mired deeply into poverty. Their distance from the poverty threshold is deep or far,
considering the fact that the threshold in Samar is below the national threshold level. This set of households comes
mostly from the rural and remote areas. Looking at income levels as a gauge of ability to engage in economic
activities beyond subsistence, this group will exhibit less of such. The expectation for these households is that their
main pre-occupation is daily survival more than entrepreneurship.

The second characteristic found among the pilot households is that the income levels of the non-poor
groups are not very far from above the threshold; their income levels in 2004-2005 are still in danger of slipping
back near or below the poverty threshold given crisis in the households. Only a minority have achieved income
levels sustain-ably away from poverty (threshold). These set of households however are poised to be more
entrepreneurial and less subsistence framed.

Duality of Interventions Addressing Two Groups

The characteristics of the households in the pilot communities indicate a need to differentiate development
interventions both in terms of project or program design and target clientele. Programs and projects to address the
poorest of the poor – or the households deeply way below the poverty threshold – are in line. The design will have
as a major outcome the shifting of the modal frame of the households from subsistence, day-to-day existence to a
higher level of development. This will entail basic social and welfare services, education (formal and informal), asset
reform, support services, basic shelter and public infrastructure.

Parallel with the interventions addressing extreme poverty are the programs and projects whose designs
are to engage the entrepreneurship-ready poor households and non-poor households that are only just above the
poverty threshold. These programs and projects shall make use of existing local resources, local capabilities and
innovative ventures needing support and capital. Interventions in this second mode, like the first, shall feature social
capital formation and organizational maturity development to make organizations and enterprise formations
operationally and organizationally viable. The interventions shall apply in all sectors feasible – agriculture and
fisheries (on-farm, on-boat and off-farm/boat activities), non-farm sector, industry (home and community-based),
small businesses and enterprises, services sector, trade and commerce, ecological-tourism, etc.

28
 Chapter

Local Governance
4

A
nalysis of the capacity and capability of the local government units (LGUs) in the municipalities covered by
the study and their respective home provinces is undertaken in this chapter. An assessment of the
development philosophy/vision of the current local chief executives (LCEs), LGU development plans,
investments, development resources and their set-up for development using strengths-weaknesses-opportunities-
threats (SWOT) approach is done, keeping in mind the importance of these factors to local economy development.
Local governance capability and capacity in helping build local economies are thus gauged both at the provincial
and municipal levels, giving indication on the feasibility of the local economy building in the island of Samar.

Institutional Assessment of LGUs

The inventory and examination of LGU development vision, philosophy, interventions and institutional
capability yielded certain features that will guide the formulation of the blueprint and the specific roles played by the
local governance sector in local economy building. The data and information gathered from the formal semi-
structured survey questionnaire and key informants are indicative of the situation of the local governance sector in
the selected Samar LGUs. The survey, however, is limited to the following LGUs: provincial governments of
Northern and Eastern Samar, municipal governments of Lavezares, Mondragon, San Jose, Borongan, Guiuan and
Mercedes.

Political Profile

Rapid profiling of the political leaderships indicate that: (a) politicians from the liberal party dominate
Northern Samar LCEs (provincial and municipal levels) and most of them are either in their first- and second-terms
of office, (b) Eastern Samar LCEs come from various political parties mostly from Lakas or Lakas-NPC coalition.
This political landscape indicate that development entities intending to introduce development interventions would
have to deal with local political leaderships that support the administration and those that are on the side of the
opposition. In practice, pro-administration LCEs have better access to development resources emanating from the
national government. Access of LCEs and LGUs to other development resources particularly the Countryside
Development Funds (CDF) or the so-called “pork barrel” also depends on the relationship dynamics between the
LCEs concerned and their respective congressional representatives.

The LCEs in Northern Samar aligned with the Liberal Party may benefit from the development resources
of the Provincial Government in as much as the current provincial governor is from the Liberal Party. LCEs in the
pilot areas in Eastern Samar in turn may be in a better position to gain from the resources wielded by the present
administration. In both provinces, there are also partnerships and development assistance offered to LCEs by party
list congressional representatives. Samar’s representation in Congress with the ascendancy of the An-waray Party
List Group is a great opportunity to generate legislative and resource support.

Overall Development Orientation and Stake

All the LCEs have a keen understanding of how much far behind their communities and constituents are
in terms of development status compared to other areas in the region and the rest of the country. The LCEs and
their respective municipal/provincial socio-economic profiles also speak of the pervasiveness of poverty among the
local populace. The LCEs who regularly attend conferences in other areas and interact with other LGUs have a
sense of how backward Samar municipalities are relative to their counterparts in Luzon and Central Visayas and
major cities in Mindanao. In other words, the prevalent development missions of these LCEs gear towards
strategies to, at the very least, approximate in modest terms the development status of their more affluent

29
counterparts. Their stake revolves around making their poor constituents less poor by feeding them and providing
livelihood, make their areas conducive and attractive to moneyed investors who will bring employment and making
their communities peaceful.

Development Capacity and Capability

Most LCEs in the pilot areas are new or second term officials. Some are traditional; some are young and
come from a dynamic background. The survey provides limited insights on the personal technical capabilities of the
LCEs. However, the LGU staff training needs assessment indicates that the LGUs have acknowledged their
inadequacies in technical skills that are valuable in development planning and investment programming. Thus the
ideal situation where the LGU technical staff provides LCEs the well-thought technical alternatives and scenarios to
come up sound policy decisions on development plans, programs and their prioritization maybe wanting in the
surveyed areas.

All of the LGUs are wanting in development resources and finances to invest in necessary development
infrastructure. Most of these LGUs are 4th to 6th class municipalities (except for the capital town of Borongan and 3rd
class Guiuan), or low-income municipalities who rely heavily on national, regional, and provincial assistance to
finance their poverty reduction programs and development needs.

Specific SWOT Analysis Findings

Strengths

1. There are development-oriented local chief executives in the pilot areas and provinces and are reflected in
the formal LGU development documents. Their plans, programs, projects and public investments indicate
the development orientation along the following sectors: health and nutrition, public infrastructure and
economic facilities. The vision, plan and investment consistency is prominent in the municipalities of
Guiuan, San Jose, Borongan and Mercedes.

2. Development vision and philosophy of the local chief executives in the pilot areas are pro-poor and
development oriented.

3. Majority of the LCEs are first or second term officials, making a medium-term development engagement
with them possible. Political assessments indicate that most of them have high chances of re-election.

4. Three (3) of the LGUs have track records in partnership and interfacing with NGOs in the areas of
environment protection (Guiuan), women (Mercedes), sustainable development, agribusiness, and
microfinance (San Jose).

5. Guiuan, Mercedes and San Jose have active development councils and technical human resources and
staff exposed and trained in participatory planning processes, project planning, management and
implementation of development projects.

Weaknesses

1. Most of the LGUs come from low-income municipality classes and have limited financial capacity and
technical capability to satisfy most of their public investments for the poor households and other poverty
reduction programs and projects.

2. Most of the LGU plans and investment programs are in broad strokes and in generic terms. Development
priorities that have impact on the poor lack the specificity in relation to target households and their specific
locations. Prioritization criteria used in the program and project line-up is unclear, if ever a criteria or
system of prioritization used. The LGUs have acknowledged these weaknesses and some manifested

30
 their need to beef up their technical capability in development planning for poverty reduction in their
respective localities.

Opportunities

1. There are considerable number of foreign-assisted projects that the LGUs may tap for local development
and poverty reduction. The development menus of these FAPs are usually supportive of poverty reduction
and local economy building objectives. The development resources offered by these FAPs come in the
form of capital assistance for infrastructure (bundled with provision of local equity in kind or in cash), credit
and microfinance, community and institutional development, local project management, and other sector-
based assistance.

2. A number of municipalities have attracted the attention of private external investors in the areas of coastal
resource management, eco-tourism, and agriculture/agri-procesing and may provide opportunity for
capital infusion into the localities (i.e., San Jose, Guiuan and Borongan).

Threats

1. Timely availability of financial resources due from the National Government given the political and fiscal
crisis may hamper the LGUs’ implementation of development programs for the poor.

2. There has been progressive decrease of grants from the National Government particularly in financing
devolved functions and responsibilities. These are in the areas of small and local infrastructure like
communal irrigation, farm-to-market roads and potable water supply.

Institutional and Organizational Support to Local Governance from the

Regional Level

Regional and local development planning, governance and development administration in Samar is under
the regional development council (RDC) system. The RDC system is in turn under the Philippine economic
planning system and structure steered by the National Economic and Development Authority (NEDA). The
President heads the NEDA Board, which is composed of the cabinet. The NEDA is composed of major planning
jurisdictions -- national/macro and sector planning and area-based regional development planning. RDCs are
organized all over the country and are in-charge of coming up with regional development plans.

The most comprehensive development plan that guides the development of Region 8, of which the three
Samar provinces are covered, is the Eastern Visayas Regional Development Plan (RDP) and its companion
development plans. The entity that makes operational the RDP is the Regional Development Council (RDC) where
all governors, mayors, regional line agencies and NGOs sit as a whole and/or through sectoral committees, charts
and coordinates the implementation of the RDP. The National Economic and Development Authority (NEDA)
Regional Office 8 serves as the technical secretariat and vice chair of the RDC.

The scope of the RDC is the regional economy and rarely focuses on local or much less community
economies. Major development concerns usually gravitate around resolving regional or crosscutting sectoral or
cross-provincial issues. The RDP focuses on the region-wide development and its integration with the national
economy. In some ways, its regional focus dissipates development efforts from the three (3) Samar provinces. In
other ways, the backwardness of the Samar island economy simply cannot compete with the more competitive
sectors of the other provinces, notably Southern Leyte and Leyte that is host to the regional capital, Tacloban. The
NEDA, which is technically equipped and competent to undertake local economic planning, has no presence at the
provincial or the local level.

31
 The development scope of the LGUs (three provincial governments in the Samar provinces, the mayors
and municipal governments therein) are limited to their respective jurisdictions. They have good provincial/municipal
development plans that are consistent with the local economy-building framework but as the survey of LGUs in the
blueprint’s baseline study shows, their respective development councils and development planning offices lack the
financial, material, logistical and technical capability to undertake local economy building. At this level of capacity
and capability, the LGUs need to forge partnerships and tap the expertise and resources of business, private sector,
civil society and development technicians in stimulating their respective economies. All by themselves, the current
pace of change and development will not alter much.

Samar Local Economy Building and Local Governance

Helping build the local economies of Samar will require two general modes of undertaking. First, there
must be political acceptance of the model and adoption by way of policy enactments by the covered LGUs. Second,
there must be development planning and investment programming assistance to LGUs and close coordination with
respective LCEs (provincial and municipal) to guide them (“hand-hold” them for local economy building) on the
development path towards local economy building.

The first mode will open partnership possibilities and provide the overriding legislative mandate to operate
within the communities and constituents of the LGUs. The second will in turn respond to the technical needs
manifested by the LGUs and enable their respective LCEs to face an array of well-thought spectrum of
development alternatives and options that efficiently and effectively uses available local and external development
resources for poverty reduction and local economy building.

32
 Chapter

Civil Society Organizations

5
T
his section examines civil society organizations in Samar and their role in local economy building. The
analysis focuses on the strengths, weaknesses, threats and opportunities (SWOT) and the possibilities for
partnership for local economy building. The details on the profiles and nature of civil society organizations,
non-government organizations and people’s organizations are found in the baseline, which is companion document
of this blueprint. The analysis done considers the political situation in Samar Island, a discussion of which is also
found in the baseline. A discussion on the opportunities for civil society to work with the different actors in local
economy building ends the chapter.

Civil Society Organizations in Samar

Strengths

The presence of POs and NGOs in Samar is a positive indication that there are efforts, other than
that of government and private business, to address the various development needs of the people of Samar.
The existence of peoples’ organizations implies that there are attempts among Samarenos themselves to
collectively address their problems and change their conditions in an organized manner. The presence of
small organizations down at the barangay level (as in the case of those interviewed in Northern Samar)
though quite small in terms of memberships, represent the existence of core groups at the grassroots level
that can or may be tapped later on to better promote political and economic development. Based on
answers from the survey and on the number of organizations found to be present in Samar, people seem to
have a trust or belief that being organized would mean a better chance of achieving positive change or
development. The presence of NGOs as well means that there are initiatives to support and harness efforts
by local people to self-organize.

One strong feature of the CSOs found among them is that their nature or concerns is mostly to
tackle basic issues presently requiring much attention in the island– livelihood and sustainable development,
protection and preservation of the environment and lack of social services. There are a number of
cooperatives already existing in the island as can be seen from the list, both secondary and first hand data.
At the same time, while it is true that economic requirements had to be addressed, the need to protect
natural resources from abuse to ensure long term use of natural resources are also of equal importance.

The programs and services of various NGOs and POs, if ever these are present and delivered
properly (for lack of data to confirm them), are of huge help to the people of the three provinces of Samar.
The training and education they provide, the social services they extend, the awareness they help create,
the finance and other logistics they able to mobilize are all inputs to the local people of Samar that could
help them change their situation and heir environment. These are the very strengths that POs and NGOs in
Samar possess that should be developed and harnessed further. Through these programs and services,
they are able to earn the trust and confidence of the Samareños. Their existence offers people immediate or
short term answers to their needs and assist them further in finding alternative solutions to poverty. Through
these programs, they are able to reach and mobilize a greater number of people.

In terms of mobilizations, the politically oriented POs and NGOs have demonstrated capabilities in
this regard, but of course for a different purpose. This shows in the various forms of mass actions they
conduct to air and advance their causes. To have such type of groups is also an advantage for Samar as
they could act as awesome pressure group, something that most of the POs and NGOs gathered are not yet
able to do. They also have strong links with other political groups outside of Samar and their own network of
development institutions and organizations to rely on.

33
 Consciousness wise, a significant majority (63%) of the CSOs are aware of their role in pursuing
development either through the promotion of sustainable economic activities or advocating for the
preservation of natural of resources. Such awareness could and should be maximized in pursuing
development activities for the island

Weaknesses

Strength of peoples’ organizations lies in membership -- their numbers, how many are active and
the level of consolidation they have achieved. If we take into account the findings of the survey, there is
great inadequacy relative to these concerns. Total membership for the 12 POs that were part of the survey
is only about 375. One group, the Save Manicami Movement (SMM) declared a membership of 200, all
active, which is way above the average number of membership of the POs of about 15 and is quite an
exception. Membership participation or activeness in the organization is only 44% for Northern Samar and
about 51% in the Eastern Samar if we exclude the SMM membership in the total.

In any case, adding to this dilemma is the seemingly low organizational appreciation and
functionality. For one, members are not that familiar with the objectives of their organizations and how the
same translate into concrete programs and actions. Second, most POs have only their set of officers to
show in terms of organizational structure. Tasks that need execution seem to be at a limbo when you try to
look at their structures. There are no existing committees whatsoever to handle recruitment of new
members generate and manage resources, education needs of its members and relations with other
organizations. Third, most groups rely on their heads to run and manage the organization. Mainly leaders
of the POs. likewise control programs or projects. Last, consolidation is far from achieved, given the fact
that membership is very small. Misunderstandings, poor attendance to meetings, bickering are some of the
common problem cited as to why their group has not achieved its goals.

On the part of the NGOs, their organizational appreciation is not that very far from the POs.
Answers on objectives were either not clear or incomplete though they were all able to enumerate their
programs. This is rather unfortunate, as NGO personnel should be familiar with the workings of their
respective agency. The three councils that interviewed reflected a higher level of organizational maturity as
objectives and programs were comprehensible, structures with specific committees were clearer and defined
regularity of meetings. Their only advantage compared with POs would be that they have programs and
services and better funding source (because of better linkages) resulting in more assets and better
equipment.

Cooperation and communication between and among POs and NGOs seem to be poor or
somewhat lacking as reflected in their responses on this matter. It was rather rare to find a PO or an NGO
interviewed, that has link or relation with another.

Opportunities

The existence of POs and NGOs presents an opportunity for a relatively much easier way to reach,
influence and mobilize people to act and/or improve their situation. These POs and NGOs have already built
links with the grassroots that are supposed to be targets and beneficiaries of development efforts. It could
also be the best chance to pull together all this organizations, POs and NGOs, to work together for a
common goal since most of their objectives are essentially the same. Such unity would be to the advantage
of the people of Samar as this could help in attracting more investors in development efforts.

Obviously, the most common of the CSOs are those involved in sustainable development and
socio-economic activities. There are 43 of them concerned with reducing poverty in the island and are
spread strategically for such purpose – from barangays to municipalities to provinces. What they offer
clearly is machinery that is already in place in strategic positions. The NGOs have their programs and
services while the POs can serve as the links to people at the grassroots level. The private foundations and

34
other NGOs of Eastern Samar have such programs to offer and the peoples’ organizations from both
provinces are still relatively active to be able serve as the line to reach out

The interest of the small POs in San Jose, Northern Samar are leaning towards addressing
economic needs as reflected in their responses on programs and other services. In this case, it would not
be difficult to rally them behind a common goal of economic and social welfare agenda.

Threats

There are two main threats to development efforts in Samar, one is natural environment and the
other on is the political environment. The island sits right along the country’s typhoon belt and as such
making it highly vulnerable to natural disasters and other calamities. Economic underdevelopment coupled
with consistent threats and damages from nature or natural disasters always put achievements by
POs/NGOs under threat of negation more especially on the eastern side of Samar. However, according to
some observation, Samar has been relatively free from direct typhoon hits compared with Luzon. Despite
this, it being regularly near typhoon paths indicates that it is more prone to the ill effects of such calamities.
Rampant and continuous abuse and exploitation of forest and other natural resources contribute more to the
dilemma.

The political environment on the other hand threatens to curtail the growth of CSOs and prevent
people from being or getting organized to pursue changes the way they see it fit.

Conclusion

There are quite a number of CSOs in existence in the island of Samar and are situated strategically
for mobilization for various development purposes. The location distribution of NGOs and POs in Samar
Island presents a positive opportunity to reach a significant segment of poor communities in the area. They
are can be found in barangays, some are operating at municipal levels and a few covers province wide. In
Northern Samar, for example, the women’s health organizations of the five barangays of San Jose town is
an indication of the existence of small but organized groups catering to specific needs of people in their
respective communities. The five organizations plus one program already presents a potential to reach
some1,237 households or 6,138 poor populace (based on population statistics from the NSO as of year
2000) of Northern Samar. This is already equivalent to 45.25% of the entire population of San Jose town.

Almost the same can be said with the Eastern and Western Provinces, where one-third and two
thirds (of CSOs gathered) respectively, of organizations identified are barangay or community based groups
and complimenting these groups are municipal and provincial-based organizations. The POs in Eastern
Samar has the prospective to reach some nine thousand people while there are 16 POs existing in eight of
the 26 municipalities of Western Samar.

The more important factor common among these organizations is their interest with projects and/or
programs that could help improve the lot of the people in Samar that is socio-economic and sustainable
development. By the very nature of the majority of these organizations, they are very much interested, at
the minimum, to activities that would help their membership find ways to supplement their incomes as proof
of the actual programs and activities these organizations are involved with as shown by primary data.
Secondary data also shows the presence of a good number of cooperatives in this province which are
essentially grassroots organizations working for economically uplifting its members. Moreover,
complimenting above factor are those groups whose principal goals are on ensuring the protection and
preservation of much needed natural resources.

However, most activities by POs are still relatively low and unconsolidated to be able to make a bigger
and upbeat impact on the lives of the Samareños. In addition, the growing repressive political climate in the
island could hinder whatever efforts CSOs may want to pursue, political or otherwise.

35
Exploring Opportunities of Working Together

Given these backgrounds and the present condition, political and economic including status of
CSOs in the island of Samar, the need to discover better and more effective ways to achieve development
becomes more critical. NGOs and POs should therefore explore more possibilities and other avenues that
would increase their abilities to reach out to a larger number of the local populace including that of asserting
its role in pursuing real development.

NGOs can initiate/facilitate dialogues between POs, government agencies or institutions and the
business sector in coming up with a more unified approach to addressing poverty and in stirring local
economy. Finding specific areas of cooperation, defining roles, setting of common objectives are just some
of the things that needed to be established. For example, the POs and the LGU of San Jose town are both
interested in implementing livelihood projects essentially for the same purpose – to generate supplemental
incomes for its constituents, but such concerns by both parties seem to be far from finding each other. The
PO’s are still looking for supplemental livelihood projects while its local government is already into
aquaculture, vegetable gardening and culturing mushrooms (based on data gathered from the LGU’s own
website). POs can take the initiative of establishing mechanisms as to how local organize groups and other
locals can avail from such program of its local government and even help it promoting it. NGOs, in turn, can
help POs prepare in handling such type of projects through provision of necessary skills and finding
appropriate technology to help achieve sustainability. NGOs can provide inputs such as giving skills training
in handling small businesses and financial management. The business sector on the other hand can help
through the provision of much needed capital and in developing market as well as corresponding strategy,
for selling all the produce.

In the town of Borongan, its local government is pursuing tourism as a strategy to achieve
economic development while the local NGOs and POs are advocating for the protection of Mother Nature. A
common ground both beneficial but still consistent with the tenets of sustainable development can probably
be reached, if again for example, these two groups would pursue defining areas of cooperation and
complementation. Local government can still make necessary investments to develop and promote local
areas for tourism while NGOs can still help in monitoring and safeguarding natural resources. Again, NGOs
can take the initiative in establishing working relations with the local government. Areas of cooperation can
start by offering their own areas of expertise as a starting point. Two of the NGOs in this town focus on
promoting sustainable development and provision of skills training at the grassroots level and the one PO
can take the lead in proposing specific guidelines in protecting the environment with consideration to locals
finding additional incomes in the area.

The same is the case with the town of Guiuan. Its local government is both into developing
livelihood and local tourism while CSOs are into promoting sustainable development with due consideration
in protecting the environment.

In effect, CSOs can serve as machineries for reaching a greater number of poor people in Samar.
Nevertheless, NGOs can also serve as an alternate source of help for local people in finding viable and
sustainable means of livelihood. POs on the other hand can serve as avenues for people to help each other
find solutions to their common problems and handle it in a collective manner.

CSOs should also look into ways how it can consolidate further its own ranks in order to prepare
them to handle bigger responsibilities and tasks in pursuing and managing real development.

CSOs with strong political advocacies should continue playing its own role and pursuing its own set
of objectives as their agenda offers a larger frame in pursuing local development in the island of Samar.

36
 Chapter
Development Financing
6 Institutions

F
inancing for the improvement of the living status of the poor and developing the local economy is an essential
feature of any meaningful development undertaking. Financing here refers to funds that serve as capital (loan
or grant) for economic and enterprise activities coming from varied sources/nature: the government, semi-
government, private sector and non-government organizations, formal and informal entities. This chapter analyzes
the development financing landscape in Samar. The analysis stems from the results of the survey done on
development financing institutions and related entities.

Major Characteristics of Financing Entities

Profile and Nature

The dominant financiers in the surveyed pilot areas are private entities. These include individuals from the
informal sector (usurers or the so-called “five-sixers” or individuals, relatives of borrowers), and the formal sector
(small private lending investors). The second dominant entities are the major development financing institutions
(Landbank and the Philippine National Bank) and NGOs/Microfinance institutions. There are footloose minority
financers – cooperatives, church-based organizations, and limited number of rural banks.

The profiles and nature of financing entities (“suppliers”) is indicative of the nature of the demand for
capital or funds. In this case, there is a lean demand for big-ticket economic activities requiring medium to large-
scale financing. The predominance and high frequency of private, small and informal lenders indicates a demand
for small, personal and emergency financing needs that are rarely investment forming or value-adding. The
presence in urban centers of Landbank, DBP and other government financing institutions that have known
portfolios for farmers, fishers and agriculture-related enterprises, is a development opportunity to start with.
Development efforts can start devising ways how to make these portfolios accessible to the poor and enterprising
poor.

Clientele and Assistance Extended

The clientele assisted and nature of financial assistance is consistent with and matches the above profile
of financial providers. The clients assisted come from quite a varied lot – women, teachers/pensioners/salaried
employees, and existing members of cooperatives and “any interested individual”. There are limited small
businesses/microentrepreneurs reached. There are no medium or large-scale enterprise clients coming from the
emerging community entrepreneurs from among those assisted by development financing entities surveyed (save
probably the unnamed major borrowers and institutional entities serviced by the LBP and DBP). Majority of the
clients are individuals borrowing for personal needs, small businesses and petty, multi-purpose causes. There is a
clear dearth in development finance demanders who are into an organized enterprise that have at the very least, a
simple system of enterprise organization (i.e., organized group of fisherfolks, coconut gatherers, rice farmers, etc.).

Finance Portfolio and Cost of Borrowing

Among the surveyed development financing entities (except for the LBP and DBP), the borrowed amount
of the clients served is generally low and micro. Loans amount range from P1,000 to as high as P300,000 –
amounts that usually fend for personal and small needs. The cost of borrowing ranges from 2 percent per month to
as high as 20 percent, with the latter obviously charged by usurers.

37
Specific SWOT Analysis Findings

Strengths

1. Borongan and Guiuan in Eastern Samar and the pilot areas near Catarman in Northern Samar have access to
formal government and development financing institutions such as Landbank, Development Bank of the
Philippines and Philippine National Bank.

2. There are formations in the pilot areas that indicate pooling of resources of individuals to create credit
cooperatives and credit unions.

3. There are small financing institutions that offer training and orientation programs to clients; repayment rate
ranges from 75 to 100 percent with the average of about 90 percent.

Weaknesses

1. In most of the pilot areas, there are very few formal development financing institutions with limited array of
development services that are easily accessible to poor households and enterprising poor. Only the
municipalities of Borongan, Guiuan, San Jose and Lavazares have access to formal development financing
institutions/microfinance institutions.

2. There are a considerable number of informal private lending entities who cater to the financing and credit
needs of the poor in the pilot areas.

Opportunity

Given the significant number of informal financial entities who serviced the financing needs of clients in the pilot
areas, there is a demand-supply gap for small, accessible and affordable development financing from formal
financing entities in the said areas.

Threat

The limited number of small development financing/microfinance institutions in the area may indicate the high-risk
nature of putting up such investments given the perception on the peace and order situation and disaster
vulnerability of the area.

Development Financing Entities: Findings and Insights

Development financing entities in Samar, particularly those that are formal and with established portfolios
for development are serving a lean, limited and narrow market. The type of financing currenly demanded is small
and informal. Their reasons for borrowing are typically for multi-purpose causes, personal and emergency in nature.
These demanders are typically situated in the rural areas or located far from the capital towns. Even if government
banks and financing institutions have available portfolios, they are inaccessible to the target clientele and/or the
target clientele are not entrepreneurially and organizationally ready to borrow at a developmentally relevant mode.

The current situation in Samar, particularly in rural areas and off-capital towns, favors informal lenders.
They are mobile, accessible to clients but charge very high cost of borrowing to demanders; neither are they
developmental. Thus, there is a demand for development financing institutions that are accessible, affordable and
educational/developmental for the small borrowers in Samar -- a development financing entity that shall pose as a
better alternative to usurers.

38
 Encouraging development financers whose products and services are accessible, affordable and
empowering to small borrowers is one side of the spectrum. On the other side, the nature of the demand for loans
should transcend petty and personal activities to more developmental, value adding and entrepreneurial endeavors.
This necessitates a two-tiered and two-phased shift in both development financers and demanders. Development
financers customize and make their financial products and services for: (a) micro, small, individual borrowers and
(b) organized borrowers for development, value adding and enterprising/innovative ventures. The organized poor
and enterprising poor (both individuals and organizations) or the “demanders”, while recognizing their current low
borrowing capacities, should veer towards a development path that go beyond petty borrowing to enterprise-
forming projects.

For the development financiers, the adjustment in strategy in Samar will be easier. This cannot be said for
the poor and enterprising poor. They need to interface with LGUs, NGOs and the private sector – the other pillars of
poverty reduction and local economy building. Thus, the challenge: Address the needs of the poor quickly and in a
sustainable manner, and move from subsistence to enterprising ventures that proliferate collectively towards vibrant
local economies.

39
 Chapter
Private Investments and
7 Remittances

P
rivate investments are essential in building and making local economies grow. Whether these investments
come from external or internal sources, they nevertheless offer resources that help create more value adding
ventures and other multiplier effects. It is difficult to achieve economic development without private capital
flowing into the economy and invested in worthwhile and sustainable businesses. The local economy-building
model seeks sustainable poverty reduction, driven by a critical mass of empowered local people and
entrepreneurial class. While private investments are a factor to make the model work, they need to be aligned and
consistent with sustainable development principles, pro-poor and engendering local capabilities. Overseas Filipino
remittances are a form of private investments that, if attracted, flowed and aligned according to the principles of
local-economy model, can bring in the needed resources that are sustainable, pro-poor, and locally empowering.
Unlike private foreign investments, remittances flowed by Filipinos come with natural attachment and stake holding
for the local communities. This chapter examines the potentials of private investments (internal and external) and
remittances of overseas Filipinos in helping development the local economies of Samar.

I. Small Private Investments in Northern and Eastern Samar

Private investments generation is an important step towards poverty alleviation. First, it provides
employment opportunities that are necessary to increase monetary incomes among poor families without
being a burden on government finances. Second, it gives income to governments that, in turn, should create
complementary projects for the poor that are beyond the scope of private business. Third, it opens new area
or type of production, thus putting a “value-added” to the local raw materials. The impact of private
investments is evolving. Once a business rises in one community it stimulates other investments to come in.

In this country, where poverty is in abundance and government has proved to be incapable of
solving this problem if not exacerbating the situation, clearly there is a need to stimulate more investments
from the private sector. However, what government does is to put more emphasis on attracting foreign
investments that is not so keen on coming to this country because of the so-called problem of peace and
order situation. Local investors, as well, face tough problems. Studies by the Asian Development Bank
(ADB) show how corruption, lack of adequate physical infrastructure and excessive bureaucracy have
deterred the business sector from establishing a base of business here.1
Table 1 Year 2000 per capita poverty In terms incentives, government led programs for
threshold & incidence of poor families (in %)
business skew towards big investors. Small business
Philippines 28.4 owners, particularly those into microentreprises, have to
Region 8 37.8 contend with the crumbs of the pie. Even some programs
Eastern Samar 47.3 intended for the poor have been channeled to those who
Northern Samar 40.7 are better off. World Bank studies have concluded that it is
Source: NSCB
usually those belonging to the higher income strata or
social standing who are able to benefit from the credit

1
The ADB led study entitled “ADB business survey highlights areas to improve investment climate” (20 January
2005) was conducted in with establishments in the Philippines. Thirty-four percent of the respondents identified
corruption as a major threat in business expansion. In particular, 41% of those who are in the textile business
complain of the severe negative impact of corruption in their business. In terms of infrastructure, the business
sector aired power failures as the culprit to their loses that on average amounts to 8% of their production.
Similarly, the lack of paved roads and maritime transport was identified as another deterrent in their production.

40
program that are originally intended for the poor.2

The role of credit and information. A study by the International Labor Organization (ILO)
identified access to credit, and training and information as crucial in enticing small and medium investments
(SMEs) or in the expansion of existing small businesses. While the samples were all taken from Thailand,
nevertheless, the result of the study also reflect the experience of other developing countries like the
Philippines.

What is revealing in the ILO study is the fact that almost all of the SMEs surveyed have procured
credit not from banks or other formal credit institutions to build and expand their business. Capital usually
come from savings before venturing into business or was set-aside during high-income season for those that
are already in business and wish an expansion. According to this study, this is what happens when formal
credit is simply inaccessible to smaller investors. This means that the requirements and charges of banks or
other formal lending institutions are beyond their reach.

The results of this ILO study are almost a photocopy of the outcome of local researches on credit
for the poor done locally. High interest rates, and too much paper works and document requirements have
deterred small rural producers away from banks. Instead, they normally opt to secure credit from informal
sources that charge higher interest but do not require any documents. Apart from this, there was an inherent
fear among the respondents to borrow from formal sources, particularly from government lending programs
that they might go to jail if they are unable to pay their loan.3

Those that are into micro enterprises (and/or what is dubbed as the informal sector) find it difficult
to obtain credit from formal sources not because they have no capacity for repayment. Instead, very few
sources of credit are willing to lend them money for lack of formal documents and accreditations.

Among small and microenterprises, capital expansion is important to be able to diversify the type of
activities and the products that they sell. In fact, a major concern on the state of small and medium
enterprises in this country is their significantly low value added contribution. According to the Chair of the
Small Business Corporation Zorayda Amelia Alonzo the contribution of the SMEs is more towards the
provision of labor and hardly in the creation and processing of raw materials, and the operations are hardly
mechanized.4

Table 2 Contribution of SMEs vs. Large Enterprises in Some Asian Countries

Indicator Philippines South Korea Japan China
Employment 67.0% 69.0% 78.0% 74.0%
Value-added 32.0% 46.0% 56.0% 60.0%
contribution
SME Population 99.6% 99.0% 99.0% 99.7%

The MODE survey on small private investors

From March to April 2005, MODE conducted a survey on the needs and views of active and
inactive small private investors on how the investment climate in Samar can be improved. Eighty-five (85)
representatives (42 % are males and 58 % are females) from the different local businesses participated. The
respondents hailed from the municipalities of San Jose (29.4 %), Mondragon (23.5%), Lavezares (23.5%),

2
World Bank (1998). “Apoyo a pequeñas empresas.” Precis no. 173. Primavera 1998.

3 st
Leyesa, Daryl (2003). The state of Philippine rural women. Presented during the 1 Rural Women’s Congress in
Taguig, 18 October 2003. Philippine Peasant Institute.

4
Zorayda, Amelia C. Alonso (2002). “The SME Development Plan and the Role of Rural Banks.” Helping Build
Local Economies. Pp. 264 to 265. Originally prepared for the Rural Banks Association of the Philippines 2002
Annual Corporate meeting and the National Convention held at the Xavier Estate, Cagayan de Oro City on 17-19
April 2002.

41
Guian (12.9%) and Borongan (10.5%). Majority of the respondents were business owners (86%), while a
small percentage were managers (9.4%) and salespersons or clerks (1.17%).

Figure 1. Distribution of business

size according to annual labor cost
1200000

annual labor cost

1000000
800000
600000
400000
200000
0

Majority of those interviewed were into the retail business (89.4%), and the rest are into food and
restaurant (5.88%) and insurance business (4.7%). More than half of the respondents are no longer active in
the business sector (61.17%). However, clearly, majority of them want to go back (76.47%). When asked for
the reasons behind closing shop, the number one reason cited was that they are able to find employment
that pays more than their business. However, they still want to continue with the business while maintaining
their present work, they find it hard to find some one who can manage in their behalf (see table 3).

Table 3 Reason why they are no longer in business?

 They have found other sources of income and cannot find any person who is responsible
to take over 8
 Age and health reason 3
 Lack of capital 2
 State of the economy 1
 High cost of inputs (including electricity) 1

Government incentives. The respondents were asked what types of incentive government should
provide to boost investments in Samar. The number one answer was capital assistance. It seems the major
obstacle among potential small investors would be the difficulty of attaining credit for capital-built-up. The
results of the survey attest that informal sources of credit such as neighbors and relatives remain the major
source of capital even for relatively larger businesses.

Another issue cited was the peace and order situation in the provinces that deter potential investors
from building their business there. The impact of an increase in taxes (the increase of the Expanded Value
Added Tax from 10% to 12%) and the prices of production inputs, such as petroleum prices, as discouraging
to the business community. As well, the erratic power supply is a major concern among the business
owners.

Table 4 What type of incentives should government provide to businesspeople?

 Capital 25
 Peace and order 21
 Less taxes (VAT, business taxes) 12
 Control on prices (i.e. petroleum) 10
Better power supply 9

The role of the NGOs. Most of the respondents are very much concerned about continued
patronage for their stores. The competition among them for such a small market in the two provinces

42
compels them to call on the different organizations in civil society for assistance in advertising their store and
the products that are made in their municipalities.

Secondly, they hope that the NGO community will be able to provide help in credit procurement for
added capital. A quality that the proposed credit program should have is low interest. Similarly, the
respondents hope that NGOs will espouse a savings trainings program to make it easier for their clients to
pay their debt to their stores.

In addition, the third most frequent answer was technical assistance in terms of producing new
items that may enable them to expand their business.

Table 5 What should be the role of the NGOs

Advertising and advocating for the procurement of locally produced products 27

Credit and capital (including savings training, etc) 26
Technical assistance on production 13

The impact of investments in Samar. A range of variables was given to the respondents to know
their perception on how it will be affected by local investments. In terms of growth in local employment, the
majority (66%) agrees that investments will bring more job opportunities. Though there was a smaller
number (19%) who disagreed on the basis that normally businesses in the provinces are small that they
usually employ family labor.

The rise in investments is said to produce a multiplier effect. That is, once a business is established
its very presence stimulates other small entrepreneurs to come into the market, either as competitors or as
complementary businesses. Fifty-eight percent (58%) of the respondents affirmed this scenario.
Nevertheless, 23% were uncertain whether this will be the case and opted not to give any remarks. The
remaining 19% of the respondents do not believe that the entrance of new private investments will be
enough to entice small entrepreneurs to go into business.

They were also asked whether going into business means greater capital accumulation for the
households. Clearly, the majority (61%) said yes, but almost a quarter of the respondents (23%) choose not
to answer this question. Only 15% said no.

Similarly, the respondents were unsure whether an increase in investments in Samar would lead to
a growth in agricultural production. The majority (47%) chose not to give a response to the questions
whether investments will have a positive effect on the local agricultural sector. Nineteen percent (19%) gave
a negative answer saying that the types of businesses are normally not related to agriculture therefore they
do not have any impact on the farming sector. The remaining 34% however are hopeful that whatever
investments come in their province will be able to use their agricultural products as raw materials or at least
increase the consumption of agricultural products of those who will be employed by the new businesses.

They showed the same pattern of responses when asked whether they believe that new
investments will be more environmentally friendly. More than half of the respondents (55%) were unsure and
chose not to give a response. Thirty-four percent (34%) said yes, while the remaining 19% said no.

Table 6 Will investments in Samar create a positive or negative effect on the following
Variables Yes No No response
Local employment 56 (66%) 16 (19%) 13 (15%)
Growth of local entrepreneurs 49 (58%) 16 (19%) 20 (23%)
Accumulation of capital for households 52 (61%) 13 (15%) 20 (23%)
Growth in agricultural productivity 29 (34%) 16 (19%) 40(47%)
Lead to a more ecologically sustainable form of 26 (30%) 12 (14%) 47 (55%)
production processes

43
 The informal sector in Samar. Government statistics are unable to capture the extent of the
informal sector in the country. For one, the fact that they are not registered with formal public institutions
makes it very hard to find out exactly their population size. In broad strokes, those belonging to the informal
sector would be those that are engaged in informal labor or enterprise that is unregistered with national
government offices, such as the Bureau of Internal Revenue and the Securities and Exchange Commission,
that hires up to ten people or less but mostly employ unpaid family labor. They can be ambulatory or home
based. 5 ILO data suggests that more than half of local entrepreneurs would fall under the informal sector. Of
those engaged in business, micro entrepreneurs and their employees who are in the informal sector are in
the most disadvantaged position. One, their lack of accreditation makes it impossible to procure formal credit
and training. Two, very few of them, if at all, have upstream linkages with formal investors that might be able
to use their products as raw materials or for further sales. Given the situation, very few of them are able to
expand and go into the next stage as small formal entrepreneurs.

In Samar, NSCB data say that there are more families obtaining their primary income from
entrepreneurial activities. Table 7 indicates that both for Eastern and Northern Samar that for every family
that depends on wages, there are almost two families that earn from micro enterprises. However, clearly, the
majority of entrepreneurial families are involved in agriculture related ventures. Their annual earnings
indicate that these non-wage earning families are mostly part of the informal sector. In Eastern Samar, the
median income of these families are between PhP30,000 to PhP59,999 annually while in Northern Samar it
ranges from PhP30,000 to PhP39,999.6

Table 7 Primary Source of family income

for the year 2000

Eastern Samar No. of families

Total entrepreneurial activities 31,551
Agri-related enterprises 24,481
Non-agri enterprises 7,070
Wages 17,935

Northern Samar No. of families

Total entrepreneurial activities 50,425
Agri-related enterprises 37,304
Non-agri enterprises 13,121
Wages 30,541

Source: NSCB 2004

5
ILO characterizes the informal sector as :“..very small units producing and distributing goods and services, and
consisting largely of independent, self-employed producers, some of whom also employ family labor and /or a few
hired workers or apprentices; which operate with very little capital, or none at all; which utilize a low level of
technology and skills; which therefore operate at a low level of productivity; and which generally provide very low
and irregular incomes and highly unstable employment to those who work in it. They are informal in the sense that
they are for the most part unregistered and unrecorded in official statistics; they tend to have little or no access to
organized markets, to credit institutions, to formal education and training institutions, or to many public services
and amenities; they are not recognized, supported or regulated by government; they are often compelled to
operate outside of the framework of the law, and even where they are registered and respect certain aspects of
the law they are almost invariably beyond the pale of social protection, labor legislation and protective measures
at the workplace. From Ya, Sandra (2001). ILO and the challenge of the informal work. Draft copy. ILO, p. 2.
previously quoted in ILO (1991). The Dilemma of the Informal Sector. ILO, Geneva.

6
NSCB (2004). Annual Statistical Yearbook.

44
Annex A: Summary of tables

Respondents:

Sex No. %
Male 36 42.3
Female 49 57.6
Total 85 100

Municipality No. %
Guian 11 12.9
Borongan 9 10.5
San Jose 25 29.4
Mondragon 20 23.5
Lavezares 20 23.5

Position in the company No. %

Manager 8 9.4
Owner 73 85.9
Sales clerk 1 1.17
Others 1 1.17
No answer 2 2.35

Sector No. of responses %

Insurance 4 4.7
Retail 76 89.4
Food and restaurant 5 5.88
Others 1 1.17
No answer

Whether in business as of present time or not

Response No. %
Yes 33 38.8
No 52 61.17

Among those who are no longer in business but wanted to return to business
Response No. %
Yes 39 76.47
No 12 23.53
Total 51 100

45
 II. Investment Potential of Remittances

Overall Situation Analysis on OFWs and Remittances

Harnessing the potential of migrant workers as entrepreneurs or sources of capital

Data from the NSO census in 2000 indicate that 2,408 registered Filipino overseas workers hail
from Eastern Samar (1,352 are women while 1,057 are men). The same organization says that Northern
Samar’s contribution to the OFW sector doubled from1995 to 2000. The number jumped from 1,129 in 1995
to 2,542 in 2000. The year 2000 data are divided between 1,236 women and 1,306 men. These data from
NSO is a very conservative estimate given that the majority of OFWs are not registered with the Philippine
Overseas Employment Agency (POEA) where the samples were taken. In fact, the results of the MODE
survey indicate that almost all of the household respondents have a close relative who is working abroad.
And this survey represents just five municipalities in Northern and Eastern Samar.

These OFWs have the capacity to channel much needed capital for business in the rural areas.
The Bangko Sentral ng Pilipinas (BSP) says that in 2003 remittances through formal channels amounted to
US$7.6 billion that is equivalent to 7.5% of the country’s gross domestic product (GDP). 7

The same ADB survey says that on average, an OFW remits US$340 per month to their families. At
a conversion rate of PhP55 to US$1, this is equivalent to PhP18,700 per month or PhP224,400 annually, an
amount that is way above the normal family income in Eastern Samar. The mean annual family income in
the province in year 2000 was PhP71,527, while in Northern Samar it was PhP80,114.8

Do the OFW set aside a portion of their income for savings or capital formation for business?
Another ADB study noted that a big percentage of the money sent by OFWs is usually spent on lavish
purchases.9 While some OFWs have allocated the amount of their remittances in business investments or
in the purchase of real estate properties, they were exceptions rather than the norm among the group
interviewed. The majority says that apart from household expenses, the next major expense would be
contributions to fiestas, marriages, and birthdays and of course, money lent to close family members.

In terms of microfinance, the OFW sector is both a source of capital and potential clients. This is a
sector with a capacity to repay loans at regular intervals through monthly remittances. In addition, this sector
has emerged as a quick source of informal credit. What needs to be done is too change their mindset in
using their capacity for long-term investments.

Results of the Household Survey in the Study Areas

About 47 percent of the household respondents surveyed in the two provinces of Samar have
relatives working abroad. Of those with relatives abroad, about 48 percent of them received some form of
assistance from these relatives.

Yes No NA Total
With Relatives Abroad 497 545 19 1061
Received Financial Assistance 237 732 92 1061

7
ADB (2005). Poverty in the Philippines: income, assets and access. Pp. 59 to 61.

8
NSCB (2004). Annual Statistical Yearbook
9
ADB (2004). Enhancing the efficiency of overseas workers’ remittances. Technical Assistance Final Report. July
2004.

46
 Most of these relatives working or residing abroad are female (60%). While 17 percent have
relatives abroad from both genders.

Male Female Both Total NA Total

Relatives
Gender of Relatives 46 113 33 192 869 1061

Thirty-three percent (33%) of the financial assistances received from relatives abroad are for
gifts/pasalubong/social events purposes. Other frequent uses are for emergency/death/burial expenses
(22%), educational expenses (19%), regular stipend or assistance (13%), other purposes (7%) and health
care purposes (6%).

Uses/Purposes of Financial
Assistance N %

gift/pasalubong/social events 89 33%

regular stipend assistance 36 13%
education 51 19%
emergency/death/burial 60 22%
health care purposes 17 6%
others 18 7%
TOTAL 271 100%

Overall SWOT Analysis

Strengths

1. Presence of private investors in the areas of retail business, food and restaurant, and in the insurance
business indicates presence of a market in the pilot areas along the previously mentioned business
lines.
2. Increasing competition has prompted small private investors to tie up with NGOs/cooperatives/POs to
advertise/link-up their products to buyers in the respective areas of operation of the
NGOs/cooperatives/POs.
3. There is potential inflows from remittances in the pilot areas since almost half of the surveyed
households (47%) have relatives working abroad (majority are female) and half of them (48%) received
financial assistance by way of remittances.

Weaknesses

1. There is a significant rate of closure and inactivity of investments due to shift in business and economic
activity of erstwhile investors, and other reasons (particularly the high cost of doing business and state
of the economy).

2. The small private investors indicated their lack of capital to build on their existing businesses on top of
the fact that their finances could no longer absorb increases in taxes, higher cost of inputs such as
petroleum products.

3. The nature of businesses of the respondents is in business lines that cater to an urban market and thus
are located mostly in built-up, urban areas. There are minimal business operations located in rural areas
where most of the poor households are located.

47
4. Majority of the remittance flows are directed to non-productive/non-investment forming ventures like
gifts, pasalubong and social events.

Opportunities

1. The small private investors/businessmen interviewed believe that given external opportunities extended
by governments in the area of capital assistance for businesses, a significant number of investors will
locate, thrive, revive or expand existing business operations in Samar.

2. Most of the small private investors agree that the entry of external investors in Samar will: (a) stimulate
small entrepreneurs to join the market (either as competitors or complementary businesses), and (b)
create more jobs/employment opportunities. (However, a small minority believe otherwise since most
small businesses employ family labor).

3. There are potential business opportunities in rural areas and in the agriculture, aquaculture/fishing and
eco-tourism subsectors apart from the traditional, urban market-dependent business lines.

4. External intervention of overseas Filipino organizations that have stakes in Samar may create positive
impacts in re-orienting and re-directing remittance flows from non-productive ventures to productive
ones (about 25% already go to education and health purposes or social capital formation and another
46% of the flows may be influenced for shifting to more productive ventures).

Threats

1. The businesspersons identified peace and order as the second major deterrent to potential investors in
locating in Samar.

2. Peace and order, and the continued risk of being devastated by typhoons deters flows of remittances to
investment and capital/employment-generating ventures and instead are channeled to emergency
and/or basic necessity purposes.

Sources:

ADB (2004). Enhancing the efficiency of overseas workers’ remittances. Technical Assistance Final Report. July 2004

ADB (2005) .ADB business survey highlights areas to improve investment climate.

ADB (2005). Poverty in the Philippines: income, assets and access.

Ya, Sandra (2001). ILO and the challenge of the informal work. Draft copy. ILO

Leyesa, Daryl (2003). The state of Philippine rural women. Presented during the 1st Rural Women’s Congress. Taguig,
Metro Manila. 18 October 2003. Philippine Peasant Institute.

World Bank (1998). “Apoyo a pequeñas empresas.” Precis no. 173. Spring 1998.

Zorayda, Amelia C. Alonso (2002). “The SME Development Plan and the Role of Rural Banks.” From Panganiban
(2002) Helping Build Local Economies.

48
 Chapter
Blueprint Specifications:
8 Strategies & Interventions

T
his chapter devotes itself to identifying the emerging development blueprint specifications in helping build the
local economies of Samar. Just like a the construction of an edifice, a set of development strategies and
interventions that aims to reduce poverty and launch local economic development, needs a set of
specifications to become effective at the least possible cost to the planners and builders. The specifications shall
come in the form of emerging strategic choices that were derived by interspersing the major strengths, weaknesses,
opportunities and threats of the five pillars and of specific economic and spatial levels in Samar.

Overall SWOT Results and Emerging Strategy Options

The following are the emerging strategy options. The sky-blue shaded boxes are the preferred mode if
one were to maximize strengths and take advantage of opportunities. Development interventions, however, need
to be tempered with the realization of risks attendant to the rest of the boxes. A reiterative process is thus
recommended to continuously assess the cost effectiveness and efficiency of pursuing aggressive strengths-
opportunities strategies and interventions in view of the weaknesses-opportunities, strengths-threats, and
weaknesses-threats. (A detailed enumeration of the SWOT tables is contained in Annex 1.)

Macro Level

At this level, the following strategy options are the overall outlook at the macro or island-wide level. The
blueprint specifications that maximizes the strengths and opportunities attendant in Samar (as an offshoot of the
findings of the study on the pilot areas) is to pursue poverty alleviation and reduction programs and projects that
shall maximize the island’s potential along its competitive sectors or areas.

Strategy 1 Maximizing Strengths & Strategy 2 Minimizing Weaknesses

Opportunities Maximizing Opportunities

Pursue poverty alleviation/reduction programs that

maximizes Samar's potentials and sectoral/subsectoral
competitive advantages ("winners") among the following
poverty groups: fishers, rice and corn farmers, cash
Crop/orchard farmers, coconut plantation workers,
landless farmers, rural women, unemployed rural folks,
etc.
Strategy 3 Maximizing Strengths &
Mitigating Threats
Pursue poverty alleviation and productivity enhancement
programs by improving program and project targeting that
shall address the concerns of the poor, population in
disaster-prone and war-torn areas.
Create greater employment opportunities particularly for
women and the poor unemployed groups along
the emerging eco-tourism sector and ensure
employment of poor households in public infrastructure
projects
Strategy 4 Minimizing Weaknesses
Mitigating Threats
Create greater opportunities for women, poor and
landless farmers and people in disaster-prone areas;
ensure that public infrastructure projects employ local
people and are located in safe areas and institute and
implement land use plan particularly on environmental
protection.

49
 These economic sectors and their publics (and attendant issues) are:

1. Coconut and its by-products

• Copra – market access, & price vulnerability (“tumador” pricing)
• Coco coir/peat – access to mechanization
• Downstream coco-products – develop coco-flour, desiccated, coconut, copra meal feeds, etc.
2. Fishery and aquamarine
• Address unsustainable/illegal fishing methods
• Product quality of seaweeds (coastal resource management)
3. Abaca production, marketing and trading
4. Palay and corn (reach sufficiency levels)
5. Eco-tourism (promotion, package tours, home stays)
6. Other agricultural products – banana and root crops
7. Non-agricultural/Non-traditional products & enterprises (women-led)

For the interventions to be relevant to poverty reduction, they must target the poor groups and the
enterprising poor among these groups. These are:

1. Fisherfolks and their families;

2. Traditional rice and corn farmers;
3. Coconut plantation workers, farmers and their families;
4. Abaca farmers, gatherers, farm workers;
5. Landless farmers and upland dwellers
6. Rural women

Focusing on the identified economic sectors need to address too the issues and concerns that impede the
growth and development of these sectors. A number of them are identified above, particularly in the coconut and
fishery/aquaculture sector. Sector studies and conferences (that bring all the stakeholders of the sector together)
that thoroughly examine the factors that impede the development of each sector are in line. This blueprint does not
cover these sector studies for lack of time and technical expertise. The succeeding activities of the development
interventionists (CANDLES) are advised by this study to go through this essential process of knowing the risks
involved in pursuing local economy building along said sector lines and target beneficiaries.

Community Level

The following are the strategy options proffered at the community level. These are offshoots of the
detailed analysis of the SWOT in the pilot study areas. The strategy options emanate from the rapid spatial analysis
of the six towns studied in two provinces. The same exercise may be done for other areas and the emerging
strategies therein may apply to the rest of the island’s municipalities.

The main strategy maximizes the presence of international and government financing institutions in
certain interest areas like eco-tourism, agro-industrial development in the identified municipalities. These entities
may have plans in the areas and these pose as opportunities favor of the identified sectors and target clientele by
ensuring that they are re-alignment and complement the CANDLES initiatives.

50
 Strategy 1 Maximizing Strengths & Opportunities
1. Ensure that the development opportunities emanating
from international & government financing institutions
are aligned along the eco-tourism and agro-industrial
potentials of Borongan and Guiuan, San Jose,
Lavezares (in terms of spatial development) and along
the comparative advantages of the Samar products
(sectoral development).
2. Maximize the assistance and services of
international, national and local NGOs in socially
preparing the community and local people on the
attendant demands and implications of the spatial and
sectoral development priorities.
Strategy 3 Maximizing Strengths & Mitigating Threats
1. Ensure that investments in terms of physical
infrastructure take into consideration environmental
hazards and that these interventions are not destructive
to the already deteriorating state of the environment in
the threatened areas.
2. Institute eco-friendly practices and enforce
environmental laws in utilization and extraction of
Samar's resources and natural endowments.
Household Level
The emerging strategy options at the household level indicate the overall potential (and demand) of
households in certain areas. Potential entrepreneurial households in Borongan and Mondragon indicate a level of
success should microfinance and similar development financing is extended and made available in these areas.
Similarly, secondary areas and specific sub-groups are present.
Strategy 1 Maximizing Strengths & Opportunities
1. Establish a development financing/microfinaning
institution that shall develop and cater to the potential
entrepreneurial households in Borongan in E. Samar
and Mondragon in N. Samar; establish secondary
centers in rural, non-poor areas in San Jose and both
rural and urban non-poor areas in Lavezares.
Secondary centers may likewise be established in
Guiuan and Mercedes urban, non-poor areas but
operating from Borongan base of operations.
2. Design and establish development-financing
products that shall target specific sectors in agricultural
and agricultural processing, fishing and aquatic
resources production and trading and
women/household members in housekeeping and/or
tending to secondary and tertiary income sources.
Strategy 2 Minimizing Weaknesses
Maximizing Opportunities
1. Integrate the development of Mercedes
into the spatial configuration of Guiuan
taking into consideration comparative
advantages, complementary development
and healthy competition.
2. Ensure that investment opportunities from
external financing sources address the
inadequacy and/or absence of basic
infrastructure that shall support the spatial
and sectoral development of Samar
communities.
Strategy 4 Minimizing Weaknesses
Mitigating Threats
1. Implement the provincial and municipal
land use and zoning plans that shall mitigate
and prevent the effects of natural disasters
and other environmental hazards.
2. Integrate Mercedes in the Guiuan
ecozone cluster plan in order to ensure that
the whole southern municipalities of Eastern
Samar benefit from the planned
development of the southern corridor.
Strategy 2 Mininimizing Weaknesses Maximizing
Opportunities
1. Review and re-design microfinance products
and services (and/or allied interventions from
other development entities) that cater to the
basic needs of the households that shall serve to
effect substantive decreases in the depth of
poverty and enable them to be nearer and/or
rise above the poverty threshold.
2. Support and supplement pro-poor and poverty
reduction financing programs of existing
microfinance providers, government financing
institutions and NGOs.
51
Strategy 3 Maximizing Strengths & Mitigating Threats Strategy 4 Mininimizing Weaknesses Mitigating
Threats

1. A campaign among both the poor and non-poor
households (particularly in E. Samar) along savings
consciousness and education on entrepreneurship,
microfinance and capital accumulation for investment
and business advisories should be undertaken to
mitigate exposure to costly and unsustainable
financing engagements.
1. Link up the poor and needy households with
pro-poor programs of LGUs and other
government service providers particularly along
education, health, agrarian reform, housing and
basic infrastructure programs.

2. Ensure accessibility (bridge the gap of social
distance between formal financing entities and
household-at-demand) of financing/credit products and
services to poor households particularly along the
following sub-groups: women/housewives,
farmers/fishers/coconut gatherers, tenants, barangay
staff and pensioners.
2. Offer accessible and affordable credit facilities
and services whose entry programs cater to
basic needs but with the attendant incentive to
access higher-level programs and services that
shall distance them away from unsustainable
informal credit sources.

The targeting of specific population sub-groups consistent with the strategy options cited above (at the
Macro Level) is also a feature of the strategy options in the household level. These are women/housewives,
farmers, fishers, coconut gatherers, tenants, barangay staff and pensioners. (These are some of the frequently
identified groups in the survey wanting to access financial services).

Local Governance Level

The following are the strategy options at the local governance level applicable to both municipal and
provincial levels:

Strategy 1 Maximizing Strengths & Strategy 2 Minimizing Weaknesses Max

Opportunities
1. LGUs Guiuan, Mercedes, San Jose and Borongan should
tap the opportunities offered by various financing institutions
and prospective investors along poverty reduction and local
economy building specifically anchored along: eco-tourism,
coastal resource management, agricultural production and
processing (coconut, corn, fishery and aquatic resources).
Opportunities
1. LGUs set aside development resources for priority
public investments in high impact areas as
counterpart equities with possible donors to
minimize capital outlay from their meager IRA.

2. Pilot LGUs should aggressively tap the opportunities
offered by foreign assisted projects particularly in the areas of
public infrastructure (farm-to-market roads, communal
irrigation, potable water supply, etc.)
Strategy 3 Maximizing Strengths & Mitigating
Threats
1. LGUs should evaluate and prioritize their programs and
projects according to the ones that deliver the highest impact
and multiplier effects on poverty reduction and local economy
building.
2. LGUs should increase their revenue bases, tap foreign
assisted projects that still provide lower equity counterparts
and invest in high impact projects for the poor households by
siting and designing them well.
2. LGUs should take advantage of capability building
components of foreign assisted projects and
technical assistance offered by national and regional
line agencies.
Strategy 4 Minimizing Weaknesses
Mitigating Threats
1. LGUs should further prioritize its public
investments to the most urgent endeavors and with
the most multiplier effects on the poor and
underdeveloped areas or sectors of its community.
2. LGUs should orchestrate convergence of efforts
by civil society, development financing institutions,
private sector and donor community.

52
Civil Society, NGO and PO Level

It is imperative for the civil society organizations, NGOs, and peoples organizations to converge and
develop a common agenda for the poor and enterprising poor in Samar. The interventions need to focus primarily
on social capital formation and/or increase social capital and organizational maturity of the organizations or
groupings of the poor and the communities. The succeeding phases are to organize their constituencies along
entrepreneurial awareness and education, development of livelihood and enterprise proposals for supplemental
income and gearing up for upscale enterprise and business operations.

Strategy 1 Maximizing Strengths & Strategy 2 Minimizing Weaknesses

Opportunities Maximizing Opportunities

1. In areas where CSOs converge and have a
common development agenda, an aggressive
program to integrate and focus their specific services
and programs should be undertaken. Potential areas
here are in San Jose and Borongan.
1. Revitalization and activation of small NGOs may be
effected through the convergence campaign initiative of
CANDLES and other upcoming NGOs interested in local
economy development in the pilot areas.

2. Cause-oriented and development-oriented NGOs
should pursue a common development program for
common/convergence areas and this will be
advocated to LGUs and government sector for
prioritization.
Strategy 3 Maximizing Strengths &
Mitigating Threats
1. Civil society interventions shall focus on
convergence areas that are low-risk relative to
effects of natural disturbances and at the same time
will lead to high impact on sustainable income
generation.
2. Civil society to focus on doable common and
priority areas while continually advocating pro-
people agenda.
2. The introduction of new and tested technologies and
best practices of incoming NGOs, microfinance
institutions and development-oriented rural banks will
help develop and enhance the organizational capability of
small NGOs/POs/cooperatives already operating in the
areas and at the same time open and/or enhance
collaboration with LGUs.
Strategy 4 Minimizing Weaknesses
Mitigating Threats
1. NGOs already operating in the pilot areas should
maintain their presence and/or coordinate with affiliated
and but stable entities to preserve the gains in
membership and organization.
2. NGOs should review the development agenda of
emerging development-oriented entities in Samar and
examine if these are consistent with their declared goals
and objectives and could help revitalize and re-mobilize
their membership bases.

The call for the civil society sector to advocate and act as lobby group to LGUs in pursuing
development –oriented undertakings is the second major strategy recommended. NGOs particularly that are on the
ground, nurturing rural poor communities are in a better position to know where, and for whom, should LGU
investments should be aligned, sited and administered. This will unburden NGOs of providing welfare services that
should be the duty of government sector. They will then have more resources and effort in developing the
organizational and enterprise readiness/maturity of the poor and enterprising poor.

53
Development Financing Entities

Development financing entities are to offer appropriate, accessible and low-cost financial products and
services to the areas and sectors where the poor and enterprising poor are. While they may locate in capital and
built-up areas, their operations can be decentralized, catering to remote but enterprise and finance-ready areas or
target clientele.

Strategy 1 Maximizing Strengths & Strategy 2 Minimizing Weaknesses Max

Opportunities
Establish development financing services and/or
microfinance institutions that offer appropriate, cheap
and accessible products and services in the pilot
areas particularly those not serviced, underserved or
reached by formal financing institutions located in
urban centers. (plus align & develop their portfolio to
identified "winners"
Opportunities
Take the opportunity to cater to the gap for
development financing by locating in underserved
areas by setting up viable alternatives to informal,
private lending entities.

Strategy 3 Maximizing Strengths & Strategy 4 Minimizing Weaknesses

Mitigating Threats Mitigating Threats
Investment in development financing services, Offer alternative development financing services in
microfinance products and services should be piloted underserved by lower-risk areas.
in in-demand and/or underserved areas but spreading
the risks attendant to the vulnerability of the
population to peace and order problems and natural
disasters.

Private Investments and Remittances of Overseas Filipinos

Listed below are the recommended strategy options for private investments and maximizing the potentials
of remittances of overseas Filipinos for poverty reduction and local economy building. Encouraging private
investments and investment-trained remittances along the major sectors and target clientele will greatly stimulate
value-adding activities and thereby create employment and other multiplier effects beneficial for the local economy.

CANDLES should also find a way to be in contact with Filipino overseas workers organizations to help in
the campaign for productive use of remittances and Samar local economy development. Touching base with the
relatives and family member of overseas contract workers from Samar through their organizations will provide the
link in this regard.

Strategy 1 Max Strengths & Strategy 2 Min Weaknesses Max

Opportunities
1. Open capital assistance to or encourage
investments (capital infusion) in areas or
businesses that: (a) have high profit/market
potential, (b) provide greater local employment
opportunities, and (c) stimulate local entrepreneurs
and other producers/suppliers. These are along the
lines of agriculture, aquaculture/fishing and eco-
tourism and related industries, and the same shall
have business tie up with pro-poor NGOs, POs and
cooperatives in the pilot, far-flung rural areas.
2. Potential inflows from remittances should be trained
to productive investment purposes (after the same
shall have satisfied priority household basic needs
like education and health) through organized
campaigns by OSF organizations.
Opportunities
1. Encourage shift of businesses to emerging
economic activities that shall support value-added
activities of the rural poor, create local employment
and encourage infusion of external capital and
investment. These are in economic and/or business
activities that encourage linkages and networking
among rural-urban areas, suppliers and producers,
putting to sustainable use the natural endowments of
the areas thereby help reduce poverty and
encourage local entrepreneurship.
2. Effect gradual shift from less-productive purposes of
remittances to more productive and investment-
forming ones by taking advantage of the campaign
potential of OSF organizations who have stakes in
Samar local economy development.

54
 Strategy 3 Max Strengths & Mitigating
Threats
1. Promote the alternative investment potentials of
Samar particularly in pro-poor and environment-
friendly investment areas mentioned above to help
reduce peace and order problems attendant to
joblessness and poverty.
2. Create alternative business and employment
opportunities to families of OSF in the pilot areas in
order to make them resilient and less vulnerable to
the negative effects of natural disasters and civil
war.
Strategy 4 Min Weaknesses Mitigating
Threats
1. Shift businesses to those that create local
employment (and help abate unemployment) and at
the same time operate on low overhead costs.
2. Campaign for the use of remittances to buy
insurance (health, education, life, and pension) and
help make families of overseas contract workers less
vulnerable to effects of natural disasters and public
disturbances.

Translating Strategies to Themes of Model Interventions

This section provides translation of the major strategy options into thematic model interventions expected
at each planning level and each actor in poverty reduction and local economy building. The complete matrix is in
Annex 2. Each strategy presented here is supported with various themes of model interventions expected from
each actor in the local economy building process.

Samar-wide Perspective and Role of the Pillars

I. Samar-wide, regional-national context

Main Strategy S-O
Pursue poverty alleviation programs that maximizes
Samar’s potentials and sectoral/subsectoral competitive
advantages (emerging “winners”) among the following
poverty groups: fishers, rice and corn farmers, coconut
plantation workers, abaca planters, landless farmers.

National-Regional Local Governments

Create local opportunities among the poverty groups by re-aligning

Regional and line agencies plan/s that designs, finances and
local resources to common service facilites, public infrastructure,
implements programs and projects focusing on the competitive technology extension and skills development along the following
advantages of Samar targeting the identified poverty groups. areas/sectors: fisheries/aqua/marine culture, coconut production &
processing, abaca production and processing, eco-tourism, etc.
(DTI, DA, DSWD, TESDA, DPWH, PCA, BFAR, etc.) (LDC, MAO, DTI, MEO, MPDC)

55
 Poor & Enterprising Poor DFIs/MFIs

-Organized enterprising poor are socially prepared to engage along the

major sectors mentioned. Development financing products and services are designed according to
-Demonstrated capabilities and experience of successful enterprising poor specific financing requirements of products and population groups,
in other areas transferred/extended to Samar poor-enterprising including the poor, cooperatives, pro-poor investor, NGOs, big
households and there is a significant uptake of the technology. businesses/integrators, etc.

Civil Society Private Investments & Remittances

- Private investors have directed and/or shifted

-CSOs have put forward and integrated their concerns
at various plan levels the advocacies of the poverty
groups/sectors
-CSOs have administered social preparation activities
to the poor; have rendered focused basic services
investments along the products and target
populace
-Remittances of OCWs are directed and/or shifted
to productive ventures for the poor and enterprising
poor

Community-based Spatial Development

Emerging stategies along major areas of concern

I I -a Municipal, Community-based spatial development

Main S trategy S -O
Development opportunities emanating from international
and government financing institutions are maximized along
the major spatial potentials of the pilot communities particularly
along the eco-tourism and agro-industrial potentials of
Borongan and Guiuan, San Jose, Lavezares (in terms of
spatial development) and along the comparative advantages
of the Samar products (sectoral development).

Governance
National-Regional Local Governments

Re-align national/agency priorities in favor
of local communities
Support and technical assistance to LGUs
LGUs are able to package financing- and
implementation-ready programs and projects to
international and government financing institutions
along the major sectoral and spatial development
potentials of their respective communities

56
 DFIs/MFIs
Poor & Enterprising Poor

Financing products for various sectors are designed,

The poor and enterprising poor participate
in the proper siting and designing of spatial
and sectoral projects of LGUs
made available and accessible to various groups
especially the poor and the pro-poor conduits
Successful financing packages that worked
elsewhere along similar investment and
business areas are replicated in the Samar
communities

Civil Society Private Investments & Remittances

Civil society foster partnership with LGUs

along the emerging sectors to ensure Private investors and overseas
sustainable development in the communities Filipinos are well-informed of the
CSO to socially-prepare the local POs/ potential businesses in the
communities in the area communities

Poor Households and the Enterprising Poor

Eme rging sta te gie s a long ma jor a re a s of conce rn

II-b Poor House holds a nd the Ente rprising Poor

Ma in Stra te gy S-O
Establish a development financing/microfinaning institution (or a network of
DFI-MFIs) that shall develop and cater to the potential entrepreneurial
households in Borongan in E. Samar and Mondragon in N. Samar; establish
secondary centers in rural, non-poor areas in San Jose and both rural and
urban non-poor areas in Lavezares. Secondary centers may likewise be
established in Guiuan and Mercedes urban, non-poor areas but operating
from Borongan base of operations.

Design and establish development financing products that shall target specific
sectors in agricultural and agricultural processing, fishing and aquatic
resources production and trading and women/household members in
housekeeping and/or tending to secondary and tertiary income sources.

Governance

National-Regional Local Governments

Stable macroeconomic -Provide basic local infrastructure that are well-sited,

fundamentals
Stable policies on
microfinancing, rural
banking & overall
development financing
well-designed for the poor and enterprising poor
-Provide basic capability-building programs, welfare
services, education and health facilities/services to the
poorest of the poor in the localities particularly rural areas
-Promote peace and order climate

57
 Poor & Enterprising Poor DFIs/MFIs

-Organize and socially prepare their ranks and organizations to receive
assistance and technology along the potential entrepreneurship lines
being envisioned in their communities
-Enterprising poor leaders (cadres) are trained and later become
entrepreneur-teachers/trainors to increase uptake of entrepreneurial
skills, successful methodologies and technologies
Develop and make available financing products and services:
- for the enterprising poor along the major sectors and areas
- for the poorest of the poor
Review portfolio on collateral lending
Establish a hierarchy and network of primary and secondary centers
in the pilot and similarly-situated communities in Samar

-Entreprenuerial poor developspecialization along various Organize and participate in development financing conferences that shall
entrepreneurial sectors and radiate or increase their outreach package financial products and services for the various emerging sectors
(sector-wise and area-wise) and products

Civil Socie ty Private Investments & Remitta nces

-Socially-prepare the enterprising poor and their Private investments and remittances interface and/or
communities in the emerging sectors and productive
converge in the emerging sectors/growth areas and
areas to better make them "bankable" and less risky.
enterprising poor households
-Develop best practices courses and capability building
programs to reinforce the knowledge, skills and attitude
of the organized poor/ entrepreneurial poor

-Develop specific advocacies/standards attendant to the

emerging sectors that shall ensure protection of poor and
the marginal sectors
-NGOs with enterprise components to invest and
demonstrate pro-poor microenterprises among emerging
sectors/products in Samar pilot communities
Private investments support the high capital needs of
the emerging areas/products and employ local
workers and/or support POs/coops
suppliers/producers whose membership come from
the poor households .

Local Government Units

Eme rging sta te gie s a long ma jor a re a s of conce rn

III. Pilot Loca l Gove rnme nt Units

Ma in Stra te gy S-O
LGUs Guiuan, Mercedes, San Jose and Borongan
should tap the opportunities offered by various financing
institutions and prospective investors along poverty
reduction and local economy building specifically
anchored along: eco-tourism, coastal resource
management, agricultural production and processing
(coconut, corn, fishery and aquatic resources).

Na tiona l-Re giona l

Re-align
national/agenc y
priorities in favor of
loc al c ommunities

S upport and tec hnic al

as s is tanc e to LGUs

58
 Poor & Ente rprising Poor DFIs/MFIs

Enterprising poor to support pro-poor,

DFIs/MFIs to offer financing packages and
pro-microentrepreneur features of the LGU plans,
services to the pilot LGUs along the identified
programs and projects
emerging and priority areas, products, sectors and
population groups
Ensure and participate in the designing and siting of
LGU plans and programs

Poor and enterprising poor to organize themselves

into local infrastructure quality control, maintenance DFIs/MFIs to open financing to LGUs to satisfy
and labor units, IAs, BAW ASAs, etc. equity requirements to access grant financing

Civil Socie ty Private Investments & Remittances

CSOs/NGOs to prepare the communities and the

Private investments (or donations) and remittances
households on the planned interventions of LGUs
can be directed to support public investments in pilot
LGUs that specifically complements business
interests and welfare of constituencies

CSOs/NGOs to advocate and influence LGU

prioritization along pro-poor identification, prioritization Private investment ventures can locate in areas
and implementation of programs and projects where the LGU have planned interventions

Civil Society Organizations

Emerg in g stateg ies alo n g majo r areas o f co n cern

I V. Civil S o ciety Org an izat io n s

Main S t rateg y S -O
In ar eas wher e CSOs conv er ge and hav e a common
dev elopment agenda, an aggr essiv e progr am to integrate
and focus their specific ser v ices and pr ograms should
be under taken. Potential areas here are in San Jose and
Bor ongan.

Cause-oriented and dev elopment-or iented NGOs should

pursue a common dev elopment pr ogram for
common/conv er gence areas and this will be adv ocated
to LGUs and gov er nment sector for pr ior itization.

L o cal Go vern men t s

LGU s with successful tr ack r ecor d in

par tner ing w ith N GOs can shar e and
help r eplicate the ex per ience with the
other pilot LGU s/ar eas

LGU s to lay dow n the ar eas and

sector s w her e they need to for ge
coalition with C SOs/N GOs for str onger
bar gaining and adv ocacy v is a v is
pr o- poor dev elopment

59
 Poor & Enterprising Poor DFIs/MFIs

The organized poor and enterprising poor in areas DFIs/MFIs to converge in the common areas of
where there is higher organizational maturity and CSOs/NGOs, LGUs and the poor households and
social participation can serve as trainers in other pilot prepare appropriate financing packages that can
areas be tapped in the potential areas.

Civil Socie ty Private Investments & Remittances

Concerned CSOs to network and

Private investors and overseas Filipinos are
compare programs & projects in the
informed of the ready investible areas or viable
pilot areas
ventures in the pilot communities and in turn,
pledges from them can be secured

CSOs/NGOs to forge common

(win-win) advocac ies at various Private investments and investments from
levels (local, regional, national) that remittances of overseas Filipinos shall support and
support poverty reduction and observe pro-poor and pro-sustainable development
enterpris e development in Samar principles

Development Financing and Microfinance Institutions

Eme rging sta te gie s a long ma jor a re a s of conce rn

V. De ve lopme nt Fina ncing a nd Microfina nce Institutions

Ma in Stra te gy S-O
Establish development financing services and/or
microfinance institutions that offer appropriate, cheap and
accessible products and services in the pilot areas
particularly those not serviced, underserved or reached
by formal financing institutions located in urban centers.
(plus align & develop their portfolio to identified "winners")

Governance

National-Regional Local Governments

Stable macroeconomic -Provide basic local infrastructure that are well-sited,

fundamentals
Stable policies on
microfinancing, rural banking &
overall development financing
well-designed for the poor and enterprising poor
-Promote peace and order climate
-Provide business incentives to DFIs/MFIs particularly
those that are intending to locate and/or operate in poor and
marginal areas

60
 Poor & Enterprising Poor Civil Society

The poor and enterprising poor that Social preparation activities by

have demonstrated capability in CSOs/NGOs in the priority
engaging DFIs/MFIs should share and areas/communities should be undertaken to
transfer their experiences in pilot areas "soften the ground" among the poor and
in Samar marginal but emerging sectors/areas

Private Investments & Remittances

Complementary areas for private business and

external investments should be offered to the private
sector, overseas Filipino investors and other
external investors who are willing to invest in
poverty alleviation and small enterprise
development

Private Investments and Potential of Overseas Filipino Remittances

Emerging stategies along major areas of concern

VI. Private Investments and Potential Investments from Remittances

Main Strategy S-O
Promote the alternative investment potentials of Samar particularly in
pro-poor and environment-friendly investment areas mentioned and
to help reduce peace and order problems attendant to joblessness and
poverty.

Governance

National-Regional Local Governments

Stable macroeconomic -Provide basic local infrastructure that are well-sited,

fundamentals well-designed for the poor and enterprising poor
-Promote peace and order climate
Pro-poor policies on remitance\ -Provide business incentives to DFIs/MFIs particularly
flows those that are intending to locate and/or operate in poor areas

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 Poor & Enterprising Poor
DFIs/MFIs

Poor households to organize

themselves and socially prepare for
possible employment opportunities
along the emerging sectors and
investment areas
DFIs/MFIs to introduce various
portfolios to overseas Filipinos/
overseas Samarnons

Civil Society

CSOs/NGOs to come up with a checklist

or criteria that shall define pro-poor and
environment friendly investment areas that
addresses poverty and social unrest

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 Chapter

Program and Project Ideas

9

T
he test of the blueprint and its specifications lies in the formulation and implementation of a viable set of
programs and projects that shall realize the goals, objectives and targets of the whole poverty reduction and
local economy building effort. Programs and projects are the “cutting edge” of development. Guided by the
larger schema, individual programs and projects work on-ground, complementing each other in carving out the
grander end-vision laid for them. This chapter devotes itself in enumerating the activities, program, and project
ideas that can possibly carve the vision of the development plan for Samar. Through a project schematic
framework, it attempts to illustrate and provide specifications of how projects and their implementers can coordinate,
complement and converge towards a common development objective. The activities, programs and projects are
neither final nor complete – these are just preliminary project ideas consistent with the findings and trends given the
overall framework of local economy building. CANDLES will have to initiate specific forums and sector-, product-,
industry-, and beneficiary studies to ascertain viability, effectiveness and efficiency of undertaking these
program/project ideas.

Project Implementation Framework and Specifications

The diagram below provides a schematic illustration of how the pillars of the local economy and their
respective development roles can converge into specific sector/product theme. In this example, the industry or
sector in focus is copra, coconut and by- products. The actors can agree on specific overriding problems
confronting the industry and converge in addressing/or instituting the specific needed interventions to make the
industry work for the benefit of the coconut farmers and their organizations.

LGU

MFIs
Poor
Copra & By-Products
Common Service Facilities
FMRs
Financing & Operation of portable
decorticating machines
Program/Project
Social preparation & capability Specifications:
bldg
•well-sited
NGOs
• well-designed
Private
Investors •Poor &
entrepreneurial
poor- denominated

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 The key specifications here lie in the nature of the interventions. In this example, the identified problem
may be “tumador pricing” or middle men and traders dictate the selling price of copra and by-products to the
disadvantage of coconut farmers. The perceived solution may be that of providing a facility that will enable coconut
farmers to process, by themselves, their raw produce into semi-processed or processed products that will
command higher prices. To do this, NGOs help organize and socially prepare the coconut farmers and gatherers to
the planned scheme. The farmers commit to the undertaking through agreements with their PO leaders and the PO
in turn prepares the proposal for financing. Development financing institutions open windows for farmers’
organization to access financing and evaluate the viability of the proposal.

LGUs can help in social preparation, provision of local equity into the venture and/or guaranteeing the
borrowed funds. LGUs can also invest in common service facilities that can house the enterprise and its facilities;
improve farm-to-market roads influenced by the venture and other support services. The POs can get in touch with
private sector businesses that agree to buy their produce (semi-processed and finished) at fair prices as long as
quality and specifications are guaranteed.

The whole system, in the medium-term, becomes a poverty alleviation and enterprise-building machinery.
Introduction of supportive and related projects and programs follow or the whole system is replicated in other
similarly situated areas. The key indicators of good programs and projects are thus: (1) they are well designed, (2)
they are well sited, and (3) they are poor- and enterprising poor-denominated.

Proposed CANDLES Priority Sector Activities, Program and Project Ideas

Macro, Island-Wide

Activities Program/Project
Samar- Ideas
wide National line agencies – Demonstration farming-
farming-,
regional- CANDLES interfacing on production & processing
applicable along the sectors in
national technologies/packages CANDLES pilot areas
context on:
LEAD: -fishery, aqua-
aqua-marine -techno-
techno-demo
-coconut production & -capacity-
capacity-building
Regional processing -inputs assistance
line -abaca -replication-
replication-uptake
agencies -traditional/non-
traditional/non-
traditional crops

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Spatial and Sector Level: LGU-Led

Activities Program/Project
Ideas/Concept
Support LGU-
LGU-CANDLES (NGO Community-
Community-based,
sector & MFIs)
MFIs) participatory community
activities to interfacing on the areas planning & organization for
the spatial and sectors that can be
agri prod’
prod’s & rural
piloted for spin-
spin-off
and sectoral projects supporting the
enterprise
spatial framework -social preparation
development -capability building
of the -local resources/equity mobilization
(initial areas that may be ready –
communities San Jose and Guiuan)
Guiuan)

Realignment of LGU Local infrastructure &

socio-
socio-economic plans common service facility
& investment develoment
programs

Poor Households and Enterprising Poor Level

Activities Program/Project
Ideas/Concepts
Poor Community assessment Food security/basic
on poorest of the poor commodities program (credit-
(credit-
Households and enterprising poor for-
for-food production
(NGOs/POs -CO for food production

and organized Identification & -Revolving credit fund for food

development of production and marketing
enterprising community -Microfinance perspective/
poor) leaders/cadres incentives

Experience-
Experience-sharing by Enterprising poor program
Enterprising successful and -demonstration-
demonstration-replication
Poor (MFIs organized enterprising
-leadership development
and NGOs) poor to Samarnons
-hands-
hands-on enterprise
engagement
-on-
on-ground replication/
radiation in identified pilot
areas

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Civil Society/Non-Government Organizations

Activities Program/Project
Ideas/Concepts
Active advocacy to re-
re- Advocacy program
align government -site-
site-specific
Civil Society & policies, programs and -At all levels possible
NGO services, projects to the poor and
their localities -LGU-
LGU-NGO partnerships in
products and environmental protection
advocacies (forest & marine)
Extend services and
converge in help augment
pilot government Community organizing
communities underserved areas program with entrepreneurial
perspective

Invest and engage in

enterprises Setting up and operations of
businesses in coconut, eco-
eco-
tourism, fishery & aqua-
aqua-marine
(and other sectors feasible)

Development Financing and Microfinance Institutions

Activities Program/Project
Ideas/Concepts
Designing/review of Credit-
Credit-for-
for-Food Production
financial services to project
DFIs/MFIs to address basic needs of - production of high value
the poor crops/agri
crops/agri products
establish and
consumption and marketing
extend
appropriate
Designing of specific Modified and customized
products financial packages microfinance program
services in the along the emerging
pilot areas & product/sector themes
target for the enterprising
poor
beneficiaries

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Private Sector Investments and Overseas Filipino Remittances

Activities Program/Project
Ideas/Concepts
Direct Project packaging for Investment mission project
private investors along -information on potential
private the major product/ winners
investments sector themes and -investment matching
applied/customized to
and OSF the poor and their -information on cost of doing
communities business in Samar pilot
remittances communities
-Local
in the -Foreign
convergence
areas Mounting of campaigns Remittance as investment &
equity campaign program
and investment
missions for OSF -resource mobilization
organizations & -remittance for equity in
overseas Samarenos businesses or viable ventures

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