To our fellow public servants, friends from the media, partners from the private sector, and all our stakeholders present here today and watching online, good morning.

Last April, we reported to the public the performance of the regional economy in 2025. The year was marked by recovery in agriculture, accelerated growth in the services sector, and emerging challenges in the industry sector. These developments ultimately resulted in a slowdown in the region’s economic growth, from 5.4 percent in 2024 to 3.9 percent in 2025. Nevertheless, the region’s Gross Regional Domestic Product (GRDP) reached PHP490 billion at constant 2018 prices.

Previously, we identified the sectors that drove our economy forward and those that required greater support. With the data presented today, we can also determine the contributions of each province to the region’s overall economic performance.

Today, we celebrate the economic growth achieved by all five provinces in 2025. The data presented by the PSA show that development in Cagayan Valley is sustained and shared – sustained, as the region continued its post-pandemic expansion in the face of new challenges; and shared, as all five provinces contributed to the stronger performance of the regional economy. Our collective commitment to development is further reflected in the preliminary results of the 2025 Poverty Statistics, which signal broad and significant poverty reduction. All provinces recorded lower poverty incidence rates and remained below the national average.

[Services]

The services sector remained the primary driver of the economies of all five provinces, accounting for shares ranging from 41.6 percent in Quirino to 66.0 percent in Batanes. The sector expanded across the region, with growth rates ranging from 3.8 percent in Batanes to an impressive 8.1 percent in Isabela. This strong performance propelled regional services growth to 7.4 percent in 2025, up from 6.5 percent in 2024.

Human health and social work activities led the expansion, growing by 14.5 percent, followed by education at 11.2 percent, transportation and storage at 10.0 percent, and accommodation and food service activities at 9.7 percent. These figures demonstrate how public investments and private sector initiatives have successfully expanded access to essential health and education services, contributing to improved opportunities and quality of life for our people.

The continued growth of transport and tourism-related services reflects our progress in positioning the region as a premier destination for nature- and culture-based tourism. However, the Gross Value Added (GVA) of the transport and storage sector remained 2.0 percent below its pre-pandemic level, largely due to the slower recovery of the sector in Cagayan, Batanes, and Quirino. Batanes likewise recorded a slight contraction in transport and storage during the year.

The seasonal implementation of hybrid learning arrangements and alternative work schemes likely contributed to this gap, while increasing vehicle registrations recorded by the LTO suggest a growing preference for private vehicles over public transportation. Furthermore, data from the DOT show a decline in foreign tourist arrivals, which remain well below pre-pandemic levels. These trends highlight the need to accelerate transport infrastructure projects and strengthen the public transportation system to support mobility, tourism, and economic growth.

[Industry]

Meanwhile, the industry sector recorded a marginal decline of 0.5 percent, as all four of its sub-sectors contracted during the year. Provincial performance was mixed. While the industry sectors of Cagayan and Quirino registered growth, these gains were not sufficient to offset the contractions recorded in the other provinces.

The increased scrutiny of public infrastructure spending amid government investigations into issues surrounding flood control projects contributed to the decline in construction output. During the same period, the mining and quarrying sub-sector also contracted as FCF Minerals Corporation began winding down its operations at the Runruno Gold Project in Nueva Vizcaya. Lower manufacturing output in Cagayan, Isabela, and Quirino further weighed on the industry’s performance.

These developments highlight the need to strengthen intersectoral linkages, particularly between agriculture and industry, to advance the region’s vision of positioning agro-industries and manufacturing at the forefront of economic growth.

[Agriculture]

For the AFF sector, all five provinces recorded growth, ranging from 1.0 percent in Cagayan to 16.2 percent in Batanes. This led to the sector’s recovery from the previous year’s contraction, which was brought about by the successive typhoons that affected the region in 2024.

At the provincial level, however, agricultural output in Cagayan and Quirino remained below their 2023 levels, following reports that some farmers opted to forgo planting due to low farmgate prices for palay. Nevertheless, Isabela and Cagayan ranked as the fifth and twelfth largest contributors, respectively, to the country’s agricultural output among the 82 provinces, accounting for a combined share of approximately 9.5 percent.

These figures underscore the region’s vital role in agricultural production and national food security. They also highlight the need to improve agricultural productivity, enhance value-adding activities, and increase farmers’ incomes to sustain the region’s contribution to the Philippine economy and ensure the long-term resilience of the agricultural sector.

Ways forward

Using the data presented today, the region will actively pursue broad-based and inclusive development by executing the following strategic measures from the Regional Development Plan:

• Scale up agricultural productivity and modernize farm operations. The DA will work closely with our farmers and fisherfolk to implement the Farm and Fisheries Clustering and Consolidation (F2C2) Program, as well as the Agricultural Machinery, Equipment, Facilities, and Infrastructure Program to bridge the gap in machinery and technology adoption. Our region will also intensify the use of early warning systems, solar irrigation systems, water-efficient and stress-tolerant crops, localized planting calendars, and other mature technologies to promote more efficient and sustainable agricultural operations. Ongoing irrigation flagship projects, particularly the Tumauini River Multipurpose Project and Balasig Small Reservoir Irrigation Project also aim to boost the productivity of farmers in the region. The operation of the new cold storage facilities in Nueva Vizcaya will also reduce production losses in the sector.

In addition, the region aims to harness the blue economy, through the acquisition of a 67-foot steel-hulled boat with ring net and complete accessories, to enable fisherfolk to venture to fishing grounds beyond municipal waters. The establishment of a Community Fish Landing Center will complement this initiative to improve production efficiency, quality of handling, and access to market by fisherfolk.

• Strengthen the linkage of Agriculture with the Industry and Services sectors. Postharvest and processing facilities are critical in improving the resilience and unlocking the potential of the agriculture sector. The completion of the i-Corn Complex in Isabela and the rice and corn processing centers in Cagayan will help operationalize this strategy. Through the ProSPER Project spearheaded by the DTI, the region anticipates the creation of quality jobs and competitive products in the agro-food industry, through product upscaling and modernization. The KADIWA outlets and the Nueva Vizcaya Agricultural Terminal (NVAT) will also support enterprise development and product enhancement in areas like processing and packaging to encourage primary producers to move up the value chain.

• Pursue diversification of the economy by promoting investments in Information Technology and Business Process Management (IT-BPM) and sustainable tourism, and supporting investments in public services. The region has laid the groundwork for attracting investments in the IT-BPM industry through improvements in digital infrastructure and human capital. Following the launch of the National Fiber Backbone Expansion Project, the DICT, in partnership with our LGUs, will continue to rollout the National Broadband Program, establish Data Transformation Centers, and promote our region to IT-BPM locators.

Nature and culture tourism will be promoted by improving tourist facilities, developing new circuits and improving access to sites. Protected areas delineation and resource mapping will be undertaken to protect our environmental assets and ensure that tourism activities in protected areas are sustainable.

The completion of the Northwestern Cagayan General Hospital, the CVMC Heart, Lung, Renal Care and Kidney Transplant Center, the Southern Isabela Medical Center Cancer Center, and the Batanes General Hospital, along with the construction of new Super Health Centers will broaden access to health services, create quality jobs and sustain growth in the sector.

• Improve physical connectivity. The government will pursue the development of the Northern and Eastern seaboards to strengthen maritime transport. The construction of the Dalton Pass East Alignment Road project, the Aritao–Quirino Road, Isabela alternate routes, along with the Daang Maharlika Highway improvements and Cagayan Bridge Projects, will improve land-based transport. Upgrades to airport infrastructure and port development projects will also boost tourism, improve logistics and enhance economic opportunities.

• Accelerate energy diversification and renewable energy development. The region will continue to expand its renewable energy development through projects that utilize hydropower, solar, geothermal, biomass, and battery energy storage systems (BESS), thus reducing our reliance on imported coal and fuel. These projects will be complemented by the Tuguegarao–Lal-lo transmission line project which will improve grid reliability, prevent power drops, and transmit clean energy efficiently across Cagayan Valley.

While the region weathers new challenges this year, including the effects of El Niño and rising oil prices from geopolitical tensions, we remain hopeful that our collective efforts will again result in sustained and shared growth. We will trudge on, ensuring that our development leaves no province behind, and advance towards our national vision of a matatag, maginhawa, at panatag na buhay para sa lahat.