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12 March 2012 1
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12 March 2012 Vol. 16, No. 06
A bi-monthly digest of global and domestic industry trends and developments. Published by the Trade and Industry Information Center, Department of Trade and Industry Manila, Philippines Tel. (632) 895.3611 Fax (632) 895.6487 To subscribe, email: publications@dti.gov.ph Online: http://www.dti.gov.ph
In this issue Focus PHL tops as investment site Inside DTI 1. IPOPHL ties up with global network 2. DTI conducts Valentine’s Day “Diskwento Caravan” Good News, Philippines! 1. Economy seen growing by 10% in 10 years 2. PHL can be global leader in healthcare BPO MSME/OTOP News 1. OTOP launches online marketing platform 2. DTI-8 to increase coco production
Business Alert 1. BOI to extend IPP for 1 year 2. PQA recognizes four organizations for excellence Consumer News DTI expects flour price rollback Feature Filipino artisans cited by experts ASEAN Watch 2011 record-breaking year for foreign tourist arrivals Statwatch DTI Direct What’s New?
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Focus PHL tops as investment site
Vol. 16, No. 062
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he Philippines is the most competitive country among seven Asian economies as an investment destination, the “2011 Survey of Japanese-Affiliated Firms in Asia and Oceania” conducted by the Japan External Trade Organization (JETRO) showed.
and second to Malaysia when it comes to the availability of executives.
Department of Trade and Industry (DTI) Undersecretary for Trade and Investment Promotions Group (TIPG) Cristino L. Panlilio said JETRO came out with the Philippine Competitiveness survey by comparing the country with six other Asian countries wherein the Philippines bested China, India, Indonesia, Malaysia, Myanmar, Thailand, and Viet Nam in most categories.
The Philippines boasts of highly competent and English-proficient labor force. Thus the rating of 37.9%, the lowest, means the country does not have a major problem when it comes to workers’ competency compared to the six other countries, with ratings from 40.9% to 56.3%.
Competitiveness indicators included in the survey were financial costs, enough labor supply, and reasonable salary. “We are the cheapest in almost all categories of doing business,” Panlilio said. The survey showed the Philippines had the cheapest rates when it comes to labor, rentals and land prices. The Philippines also had the least problem on the competency of its labor pool. In terms of labor supply sufficiency, the Philippines emerged to have the most plentiful number of workers
Inside DTI 1. IPOPHL ties up with global network
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he Intellectual Property Office of the Philippines (IPOPHL) has joined a global network of IP offices to raise efficiency in processing patent applications. IPOPHL Director-General Ricardo R. Blancaflor and Japan Patent Office (JPO) Commissioner Yoshiyuki Iwai signed an
“In terms of employment retention, we have the best loyalty record. In terms of problems of workers competency, we have the least problem,” Panlilio said.
Specifically, the JETRO survey showed that when it comes to problems on increasing financial costs in the Philippines, the country had the lowest percentage rating of 4.6% while China had 64.1%. Comparatively, ratings of Malaysia, India, Indonesia, Thailand, Viet Nam ranged from 51.9 to 61.5%. “The implication of this project is that even in Asia, we are now very competitive. In fact, we are the most competitive when it comes to those factors of business or investment decision making,” he said. The survey was conducted by JETRO on Japanese-affiliated Firms in Asia and Oceania for the August-September 2011 period. (MAB 02/13)
agreement allowing the Philippines to join the Patent Prosecution Highway (PPH) network. The three-year program slated to begin this month will enable both countries to share IPO workload, enabling the use of foreign applications as reference for local ones.
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2. DTI conducts Valentine’s Day “Diskwento Caravan”
12 March 2012 3
“PPH is envisioned to benefit both examiners and applicants as it will increase efficiency of examination and result in faster turn-around time,” Blancaflor said.
Members of the initiative include the US Patent and Trademark Office (USPTO), European Patent Office, and the Korean Intellectual Property Office (KIPO).
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Since its implementation in 2008, this has become a continuous project of the DTI with the support of the private sector.
t least 20 basic and prime goods manufacturers sold their products at factory prices during the Valentines’ Day “Diskwento Caravan” of the Department of Trade and Industry (DTI) at its main office in Makati City. Discounted products ranged from medicines, bread, sardines, cooking oil, processed meat, fruits, vegetables, and fresh eggs to detergent bars, shoes, school bags, uniform, and supplies.
Good News, Philippines! 1. Economy seen growing by 10% in 10 years
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he Philippine economy can possibly grow by 7%-10% in the next 10 years, leading economist Dr. Bernardo Villegas said. In his speech during the recent Asia CEO Forum in Makati City, he said the Philippine economy is reaching its tipping point due to over 25 years of slow and painful reforms. Villegas said economic reforms were started during the administration of the late President Corazon C. Aquino, the mother of incumbent President Benigno S. Aquino III. He said it was during the time of Mrs. Aquino that various reforms in the Philippine banking system were initiated. In addressing the problems on energy, he said Former President Fidel V. Ramos started the energy sector’s privatization. “Now there is so much interest in the energy sector in the Philippines,” Villegas said.
The Diskwento Caravan aims to help ease the economic burden of Filipinos by inviting manufacturers to sell their products directly to consumers at very affordable and discounted prices.
He also mentioned that it was during the administration of Former President Joseph E. Estrada that a 180-degree shift was made from industrialization to building farm to market roads, while Former President Gloria M. Arroyo focused on infrastructure development. Going to the present administration of Aquino, Villegas said the incumbent is building very aggressively upon the foundations from the past administrations by its fight against corruption. Furthermore, the economist elaborated the positive trends in the Philippines that will help boost the economy such as stable democracy, strong macroeconomic fundamentals, and labor peace. Another trend is the high rate of savings because of remittances from overseas Filipinos (OFs) who account for 12% of the country’’s gross domestic product (GDP).
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Furthermore, because of the country’s large population and rich resources, the Philippines has become one of the emerging markets in the world. On possible sunrise industries that can be developed in the coming
2. PHL can be global leader in healthcare BPO
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he Philippines is poised to become the world leader in the multibillion-dollar healthcare information management outsourcing this year, an executive of the Information and Communications Technology Office (ICTO) said. “The availability of licensed healthcare professionals such as nurses in the country would ensure the steady supply of agents to fill in the seats for healthcare outsourcing,” ICTO Deputy Executive Director Alejandro P. Melchor III said.
MSME/OTOP News 1. OTOP launches online marketing platform
years, Villegas identified agribusiness, mining, transport, telecom, tourism, infrastructures, automobiles, consumer durables, information technology (IT), logistics and retailing, healthcare, and medical tourism. (TMT 02/16)
management, and pharmaceutical benefits management. As the number one voice services provider worldwide, Melchor added that it is crucial for the Philippines to move into “high-value chain” services such as the four growth areas. “Medical information outsourcing is the most promising of the four sectors we are targeting for growth. In fact, the Philippines is the de facto number one this year, not in the total number of seats but in terms of being a destination of choice,” Melchor said.
Melchor said that besides medical transcription, the healthcare outsourcing market has evolved to include high-value services namely clinical coding, disease management, revenue cycle
To date, some 14,000 Filipino healthcare professionals haved earned US$102M in revenues for the healthcare sector. (TMT 02/16)
he One Town, One Product (OTOP) Philippines provides micro, small and medium enterprises (MSMEs) a new platform for online business and marketing called “otopphilippines.org” by listing them in OTOP online directory and linking their websites with the OTOP portal where they can post their products and services.
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operations in linking buyers and suppliers quickly and cost-effectively.
Department of Trade and Industry (DTI) Undersecretary for Regional Operations and Development Group (DTI-RODG) Merly M. Cruz said providing MSMEs the best Internet services can be the most efficient, timely, and cheapest aid for business
The OTOP website will also enable them to compete on marketing terms with the world’s best, and provide a unique opportunity for DTI-RODG to deliver on OTOP’s core mission of providing more business opportunities for MSMEs.
The otopphilippines.org provides facilities for Internet search-engine marketing and traditional trade shows. Through the portal, MSMEs will also save time, money, and resources, while increasing sales and customers.
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2. DTI-8 to increase coco production
12 March 2012 5
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he Department of Trade and Industry (DTI)-Region 8 will push the coco coir and coco peat production to meet the increasing demand for more environment-friendly products in the international market. “In general, coconut prices are on the downtrend due to oversupply. Lately, however, slight increase in the prices of coconut products like fibers has reawakened the enthusiasm of coconut-producing countries,” DTI-8 Regional Director Cynthia R. Nierras said.
Business Alert 1. BOI to extend IPP for 1 year
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he Board of Investments (BOI) plans to extend the 2011 list of sectors that would get incentives under the proposed 2012 Investment Priorities Plan (IPP), which would be in effect for two years by 2013.
“This year’s IPP would not change very much,” said BOI Managing Head Adrian S. Cristobal, Jr., who is also the Department of Trade and Industry (DTI) Undersecretary for Industry Development and Trade Policy Group (IDTPG). Cristobal said the 2012 IPP would carry last year’s list because “government recognizes that less than a year of implementing the IPP is not enough to validate how effective [the list is]. It’s about time to look at
2. PQA recognizes four organizations for excellence
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s a benchmark for business excellence, the Philippine Quality Award (PQA) cited four government offices and private companies recently for excellence and leadership in the country. Department of Science and Technology (DOST)-Region 9 and DOST-Metals Industry Research and Development Center (MIRDC)
Region 8 or the Eastern Visayas is the second largest coconut-producing region in the country, being able to produce 2B coconuts annually. “It is also in demand for the fishing industry since it is buoyant, resistant to bacteria and salt water, thus making it suitable as marine cordage and for use in commercial marine culture,” Nierras said. There is also a high demand for coir and its byproducts such as coir dust and peat in Europe, particularly in the Netherlands.
the IPP as a long-term [measure] and implement it for two years before undertaking a review.” The BOI was set to conduct a two-day simultaneous public consultation on the 2012 IPP in Metro Manila, Cebu, and Davao. The BOI would present the 2011 IPP for extension into 2012 of the 13 priority sectors entitled to incentives. Cristobal said the two provisions – disaster relief and recovery and research and development – are up for review because there were hardly any investments. By next year, inputs of the industry or sectoral competitiveness roadmaps would be integrated into the IPP, he said. (MAL 02/16)
were recognized for “Commitment to Quality Management.” Meanwhile, the Automotive Airconditioning Technology Phils., Inc. and NYK-TDG eBusiness Corp. both received “Recognition for Proficiency in Quality Management.” “What we have achieved in PQA is a competitiveness template that
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Vol. 16, No. 066
both public and private organizations can use. The PQA manual is a tool to assess the organization’s strengths and areas for improvement towards sustainable organizational excellence,” Department of Trade and Industry (DTI) Secretary Gregory L. Domingo said.
The PQA Act of 2008. It sets the standard of excellence to help organizations achieve world-class performance.
The PQA was established in 1997 through Executive Order No. 448 and was institutionalized through Republic Act No. 9013 or
These assessors evaluate the application, write feedback reports, and prepare recommendations to the board of judges.
The awardees had undergone a rigorous assessment process with teams of expert assessors.
PQA Levels of Recognition 1. Recognition for Mastery in Quality Management. The organization should have demonstrated superior results clearly linked to robust management systems and practices which other organizations can learn from. It should serve as role model for other organizations in the Philippines. 2. Recognition for Proficiency in Quality Management. The organization should have demonstrated significant progress in building sound and notable processes; has documented and solid approach to system-level quality and productivity management; and has been implementing quality and productivity improvement plans and procedures. 3. Recognition for Commitment to Quality Management. The organization should have demonstrated its serious commitment to improvement in order to achieve quality excellence. It should have planted the seeds of quality and productivity.
Consumer News DTI expects flour price rollback
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ocal flour millers are expected to rollback prices of flour to P800-P830 per 25-kg from the current P900-P940 following the decline of global wheat prices. Global flour prices went down to US$300-US$400 per metric ton (MT) from last December’s US$313.8 per MT average. “We expect them to go down to P800-P830 per bag to reflect the decreases in wheat prices in the international market,” DTI Undersecretary for Consumer Welfare and Business Regulation Group (CWBRG) Zenaida C. Maglaya said.
CWBRG is sending out letters to flour millers to submit their acquisition cost on a per company basis. The DTI is also drafting a “show cause” order why the flour millers have not yet reflected the reduced prices of wheat in their locally-milled flour. Maglaya said the pending case before the Makati Regional Trial Court (RTC) filed by three flour millers against the DTI cannot prevent DTI from filing another profiteering case against the millers as DTI can file the profiteering charges against individual flour companies.
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Feature Filipino artisans cited by experts
12 March 2012 7
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he revival of the handicraft industry and the unique artisanal quality of Philippinemade products were highlighted by trade experts from the United States (US) and Japan as the Philippines’ strength at the recent Manila Furnishing and Apparel Manufacturer’s Exchange (FAME) International trade show. The Center for International Trade Expositions and Missions (CITEM) invited experts from Japan’s Manufactured Imports and Investment Promotion Organization (MIPRO), US’ By Hand Consulting, and Materials ConneXion to share market strategies for Philippine manufacturers to gain more market access in foreign countries and help make Philippine export products be more viable in the international market. By Hand Co-Founder Colvin English and MIPRO Planning and Coordination Department Director Kiyotaka Hishida shared their ideas regarding the strengths that the Philippine made-products can capitalize on to compete against cheaper products
ASEAN Watch 2011 record-breaking year for foreign tourist arrivals
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he expected 3.9-M mark of foreign travel arrivals in the country was breached with the help of gains made by regional markets, Department of Tourism (DOT) Secretary Ramon R. Jimenez, Jr. said. In 2010, the record was 3.5M but clear improvement was on the upswing due to government change and the people’s hopefulness for a new life and a better future. “When the industry exceeds expectations as it had done last year, we feel very encouraged. And with the overwhelming response to our new brand campaign launched last month,
coming from countries like China and Taiwan. “The nature of production processes in the Philippines falls within renewable and sustainable. So much work here is done by artisans, using the hand, and it all falls in the green, sustainable, and fair trade models of business right now that is worth exploring,” English said. “Philippine products made from materials that are not available in the Japanese market, and very fine craftwork are the Philippine products’ strengths,” Hishida said, noting that the craftsmanship that Filipinos have is appealing to the Japanese consumers. Materials ConneXion Founder and Chief Executive Officer (CEO) George Beylerian said there is more to the Philippine export industry than what it is now. “I feel this is a good time to tell people to come here for creativity, for innovation, as well as to make the Philippines known for its extraordinary material richness,” Beylerian said. (balita.ph 02/09)
we know that we have broken ground on crowd sourcing. The people’s campaign will help bring more numbers,” said Jimenez. For the first time in the history of Philippine tourism, total visitor arrivals in the country in 2011 reached close to 4M, which is 11.3% higher than the 3.5M posted in 2010 and surpassed by 4.6% DOT’s 2011 target visitor expectation of 3.7M. East Asia continued to lead all regional markets with 1,837,681 arrivals, 46.9% of the entire number last year. South Korea remained as the strongest single market with 925,204 arrivals for a 23.6-%
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share of visitor volume. Japan contributed with 375,496 visitors or 9.6-% share, China with 243,137 or 6.21-% share, and Taiwan with 181,738 or 4.64-% share. Tourists from the US, the country’s second-largest tourist market, totaled 624,527 or 15.9% of all tourist traffic. Tourist arrivals from Australia and Canada experienced double-digit growth with 170,736 and 117,423 visitors, respectively. Meanwhile, Singapore and Malaysia provided the majority of the 331,672 visitors from the Association of Southeast Asian Nations (ASEAN) with which the Philippines expects greater integration in tourism following the 15th Meeting of ASEAN Tourism Ministers in Manado, Indonesia last January. Northern and Western Europe posted near-identical numbers with modest growth of 164,205 and 157,265 arrivals, respectively. (MAB 02/05)
STATWATCH 2B Annual coconut production in Region 8; 1.8 in Region 4 US$102M Revenues generated by Filipino health care professionals in the healthcare sector to date 3.9M Foreign travel arrivals in the PHL in 2011 vs. 3.5M in 2010
14,000 Filipino healthcare professionals in the health business process outsourcing as of 2011 12% Share of remittances from overseas Filipinos (OFs) in PHL’s gross domestic product (GDP)
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12 March 2012 9
DTI Direct* Call Center Report SUMMARY OF CALLS Month-on-month CALL TYPE
Feb
Mar
Business Name
2,494
2,855 1,980
Consumer Welfare
Apr
May
Jun
July
Aug
Sept
Oct
2,229
2,054
2,020
2,250
2,398
2,017
Nov
Dec Jan’12 Feb’12
1,874 1,458 3,665
2,741
546
724
532
732
715
637
741
812
712
670
966
742
860
Exports
2
9
8
9
9
9
9
9
1
5
5
4
7
Investments
4
7
5
4
5
5
4
2
0
3
0
0
1
MSMEs
13
12
8
15
21
20
26
27
23
20
15
12
10
Others
675
852
656
1,040
908
891
985
1,186
981
1,194
941 1,157
1,179
TOTAL
3,734
4,459 3,189
4,029
3,712
3,582
4,015
4,434
3,734
3,766 3,385 5,580
4,798
CUMULATIVE CALL TYPE
Jan-Feb
% vs. Total
Feb 2012
Jan 2012
% Increase/ Decrease
Business Name
6,406
61.73
2,741
3,665
-25.21
Consumer Welfare
1,602
15.44
860
742
15.90
11
0.07
7
4
75.00
1
0.11
1
0
NA
22
0.21
10
12
-16.67
Others
2,336
22.51
1,179
1,157
1.90
TOTAL
10,378
4,798
5,580
Exports Investments MSMEs
CALL RESOLUTION STATUS Jan-Feb 2012
February 2012
Endorsed - 137, 1%
Resolved 10,241 99%
Endorsed - 50, 1%
*The DTI Direct Call Center was established in November 2006 as part of the Department’s thrust to improve and simplify the delivery of its frontline services.
Resolved 4,748 99%
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(A synopsis of selected book acquisitions at the DTI-TIIC library)
Legend: MAB - Manila Bulletin MAL - Malaya TMT - The Manila Times Balita.ph
Title: World Bank East Asia and Pacific Economic Update 2010: Emerging Stronger from the Crisis Publisher: World Bank Call Number: 45 000/03/WB/2010
Title: Strengthening Rural Livelihoods: The Impact of Information and Communication Technologies in Asia Author: Grimshaw, DJ/Kala, S Call Number: 45 000/13.06/GRI/2011
The book shows how East Asia recovered from the global economic and financial crisis. It also identifies two common national agenda items for the medium term: 1) the process of regional integration driven by Association of Southeast Asian Nations’ (ASEAN) commitments to creating a single economic area, and 2) addressing climate change as a high priority in the region. It contains country papers and key economic indicators.
This book provides a useful and balanced review of the influence that mobile phones and the Internet can have in supporting the livelihoods of rural people, particularly farmers in Asia. Drawing on six case studies from Sri Lanka, India, the Philippines and China, it shows the beneficial impact that such technologies can have for enhancing livelihood assets, reducing vulnerability, and complementing existing extension services.
Philippine Postal Permit No. PM-04-08
What’s New?
Vol. 16, No. 0610
Editor-in-Chief: Anne L. Sevilla Associate Editor: Vic S. Soriano Writers: Resty P. Par, Jam A. Hourani, Aye B. Salcedo, Elaine M. Lazaro, Emman R. Caleon Design/Layout: Ren C. NeneriaCirculation: Myrna V. delos Reyes To subscribe, email: publications@dti.gov.ph