With the contraction of the national economy in 1998, only seven regions led by the Cordillera Administrative Region (CAR), registered positive growth rates in their Gross Regional Domestic Product (GRDP). The CAR posted the highest growth rate of 4.9 percent followed by Ilocos Region with 2.8 percent growth, and closely by Southern Mindanao Region with its 2.4 percent increase. This is based on the estimates prepared by the National Statistical Coordination Board for the period 1996-1998 released on July 9, 1999. The GRDP is an aggregate measure of the goods and services produced by the regional economies.

The relatively good performance of CAR was due to the hefty growth in construction activities with new water utility projects and the increased production in gold mining and in quarrying activities. For Ilocos Region, it was also the construction that significantly contributed to its growth coupled with the good performance of trading.