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8 September 2014 1
8 September 2014 Vol. 19, No. 18
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A bi-monthly digest of global and domestic industry trends and developments. Published by the Knowledge Managment and Information Service of the 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’s Q2 GDP growth more robust Good News, Philippines! 1. PHL mfg sector robust 2. PHL’s exports to Israel up 15.54% Inside DTI 1. DTI to finalize 9 industry road maps 2. DTI to issue Lemon Law IRR in Nov 3. PHL, EFTA aim to start trade talks in early 2015 MSMEs 1. DTI welcomes Go Negosyo Act approval 2. Bohol weaving industry gets much-needed boost 3. Entrepreneurship promoted at local level 4. Aklan celebrates SMED Week with information sessions
Business Update 1. Baguio, Benguet businesses get Bagwis 2. Investment Promotion Center opens in Capiz Consumer News 1. DTI widens reach to consumers through TV 2. DTI: Convenience stores not exempt from price freeze in typhoon-hit areas Feature Starting a corporate giveaways business Asiawatch Bilateral trade between PHL, Indonesia gets boost Statwatch What’s New?
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Focus PHL’s Q2 GDP growth more robust
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he Philippine economy was seen to have expanded in the second quarter of the year on the back of robust public spending, the National Economic and Development Authority (NEDA) reported. Socioeconomic Planning Secretary Arsenio M. Balisacan said the government is confident that the country’s gross domestic product (GDP) in April to June grew within the full-year target of 6.5%-7.5%. “Public spending accelerated in June, so that should improve the second quarter growth performance,” Balisacan said. He said strong public spending in June has fuelled the country’s main growth drivers which are the manufacturing and services sector. On the same note, Department of Finance (DOF) Policy
Good News, Philippines! 1. PHL mfg sector robust
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he local manufacturing sector expanded at a faster pace than the global average during the last three years, the Federation of Philippine Industries (FPI) reported. Citing data from the United Nations Industrial Development Organization, FPI Director Roberto F. Batungbacal said the country’s manufacturing sector grew faster than the average growth rate of the Association of Southeast Asian Nations (ASEAN) manufacturing sector as well as the global average. Data showed that the local manufacturing sector expanded by 5.77% during the 2010 to 2013 period, much faster than the 4.97-% growth average posted by the ASEAN and the global average increase of 2.17% in the same period. Aside from the Philippines, other countries in the region which outpaced the average growth
Development and Management Services Group (PDMSG) Undersecretary Gil S. Beltran said that the country’s economy likely grew at a faster pace in the April to June period due to strong public spending and with the help of the private sector. Beltran said the government’s full-year growth target is still attainable in the remaining months. Public spending surged by 44% in June to P201.13B from P139.54B in the same month last year, bringing the year-to-date expenditures to P987.71B, up 11% year-on-year from P890.75B. Aside from public spending, the country’s economy will also be driven by domestic consumption fuelled by strong remittances and services, as well as continued expansion of manufacturing sector. (MAB 08/06)
posted by ASEAN and the world were Indonesia (5.88%) and Malaysia (5.10%). Other countries which expanded at faster rates than the global growth average, but slower than the ASEAN average were Viet Nam (4.83%), Thailand (3.63%), and Singapore (3.45%). The FPI has been actively pushing for the growth of the manufacturing sector. This, as Batungbacal noted earlier that the manufacturing sector has the highest potential to provide long-term inclusive employment to a country with persistently high unemployment and underemployment. The government aims to revive the manufacturing sector to promote economic growth and create jobs. In 2012, the Department of Trade and Industry (DTI) launched the
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industry roadmap initiative to promote the growth of specific industries and the entire manufacturing sector.
2. PHL’s exports to Israel up 15.54%
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he growth of Philippine exports to Israel has hit 15.54% last year on strong purchases of fish, data prepared by the Department of Trade and Industry (DTI) showed. The DTI prepared the bilateral trade figure between the Philippines and Israel as a reference by the Presidential Management Staff (PMS) in light of the nomination of Israeli Ambassador Menashe BarOn for the Order of Sikatuna award. Bilateral trade between the two countries has improved to USD 177.12M in 2013, or 7.18% higher than the USD 165.24M registered in the same period in 2012, making Israel the Philippines’ 38th biggest trading partner, 32nd export market, and 40th import supplier. On investments, Israeli invested P30M in 2013, a huge jump
Inside DTI 1. DTI to finalize 9 industry road maps
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he drafts for nine industry road maps, with seven on food, are expected to be ready within the year, the Department of Trade and Industry (DTI) said. “Before the end of the year, there should be draft road maps for these industries,” DTI Industry Development Group (IDG) Assistant Secretary Rafaelita M. Aldaba said. For the seven road maps focused on food, Aldaba is hopeful the drafts will be ready this month. With food seen to account for the biggest share or 50% of manufacturing, the DTI decided to choose seven food industries which are seen to have huge growth potential.
At present, there are 24 roadmaps which have been completed and submitted to the DTI. (TPS 07/30) from only P5.96M in 2012. Israeli investments were mostly into administrative and support service activities, wholesale and retail trade, and repair of motor vehicles and motorcycles. The increase in the Philippine exports to Israel was largely due to higher purchases of fish, whole or pieces of tuna, skipjack and bonito. Other exports include electronic micro-assemblers, and electrical apparatus for line telephone. Some of Israeli firms in PHL
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NCO Philippines Clark Inc. S&L Services Inc. Diafox47, Inc. Cinnvoation Inc. Mediamind Technologies Philippines Inc. True Logic Online Solutions Inc.
Aldaba said the growing local market presents opportunity for the seven food industries. “You know that there is a big market. There is an opportunity and there is demand so might as well address that,” Aldaba said. 9 Road Map drafts in 2014
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Carrageenan Condiments Cacao and chocolates IC design Processed shrimp Processed meat Processed fruit focused on mangoes Processed fish Shipbuilding
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2. DTI to issue Lemon Law IRR in Nov
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he implementing rules and regulations (IRR) for the recently passed Lemon Law which seeks to protect vehicle owners are expected to be issued in November, the Department of Trade and Industry (DTI) said. “Republic Act (RA) 10624 takes effect on 07 August 2014 while the IRR is expected to be published and released by 07 November 2014,” the DTI said. The Lemon Law seeks to protect consumers in the event that a brand new vehicle purchased does not meet the standards set by the manufacturers. Under the law, vehicle owners may demand for either a refund or replacement if the brand new car is found to have defects within one year from purchase and the glitches are unresolved even after four repair attempts by the concerned manufacturer, distributor, or authorized dealer or retailer.
Mario A. Dimagiba said the approval of the Lemon Law is a significant achievement for the agency as such will provide protection to consumers. “Consumers are now appeased that their rights and welfare in the sale of motor vehicles will be protected against business and trade malpractices, and that redress is readily available for them at the DTI,” he said. As the sole implementing agency of the law, the DTI will have jurisdiction over disputes that may arise between car owners and the manufacturers, distributors or authorized retailer of the defective vehicle. “The DTI has been successful in its use of the Alternative Dispute Resolution (ADR) system in addressing consumer complaints and under the Philippine Lemon Law, the agency will continue using ADR for resolving disputes related to the sale of motor vehicles,” Dimagiba said.
DTI Consumer Protection Group (CPG) Undersecretary Victorio
3. PHL, EFTA aim to start trade talks in early 2015
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egotiations for a free trade agreement (FTA) with a 4-nation European block will start early next year, the Department of Trade and Industry (DTI) said. In a press conference held on the sidelines of trade talks between the Philippines and Switzerland, DTI Industry Development Group (IDG) Undersecretary Adrian S. Cristobal Jr. said the Philippines and the European Free Trade Association (EFTA) aim to complete "scoping" this year. "Scoping," which refers to the identification of the guidelines for negotiations, should start this month. “Our target is to wrap it up this year. We are targeting or hoping we could
start negotiations early next year,” Cristobal said, adding both parties aim to wrap up trade talks in two years. The Philippines and EFTA signed a Joint Declaration on Cooperation, which lays the ground for free trade talks. The EFTA group countries include Iceland, Liechtenstein, Norway, and Switzerland. The Philippines and Switzerland attended the inaugural meeting of the Joint Economic Commission, a venue for regular dialogue to improve trade and investment flows between the two countries. The bilateral commission is the result of talks between DTI Secretary Gregory L. Domingo
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and Switzerland State Secretariat for Economic Affairs (SECO) Director Marie-Gabrielle Ineichen-Fleisch held in June last year. Two-way trade between the Philippines and Switzerland reached USD 550M last year, with the Philippines a net importer at USD 405M. Trade "is still modest but the important thing is trend is positive in both directions. As far as
MSME News 1. DTI welcomes Go Negosyo Act approval
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he Department of Trade and Industry (DTI) welcomes the approval into law of the Go Negosyo Act which would help promote the growth of micro, small, and medium enterprises (MSMEs) in the country. According to the DTI, the approval of Republic Act (RA) 10644: An Act Promoting Job Generation and Inclusive Growth through the Development of MSMEs or the “Go Negosyo Act,” is expected to bring government services closer to small businesses through the establishment of Negosyo Centers in all provinces, cities, and municipalities. “With the Go Negosyo Act, the DTI, with the support of local government units (LGUs) and other government agencies, expects to further boost its assistance to MSMEs to grow and flourish, and intensify the promotion of entrepreneurship in the country,” the DTI said. The Go Negosyo Act was signed into law by President Benigno S. Aquino III on 15 July 2014. Under the law, the Go Negosyo Centers to be established would be placed under the supervision of DTI. The Go Negosyo Centers would facilitate doing business and access
investments are concerned, total investment is about USD 3.8B. That is also a sound basis to start from,” SECO-Bilateral Economic Relations Division Head and Ambassador Livia Leu said. During the inaugural meeting, the joint commission lined up possible cooperation in the areas of manufacturing, aerospace, chemicals, pharmaceuticals, semiconductor and electronics, and business process outsourcing.
to services for MSMEs and would be linked to the Philippine Business Registry System (PBRS) to make it easier and faster for entrepreneurs to start and register their businesses at the local level. The PBRS is a government project that integrates the services of all agencies involved in business registration, such as the DTI, Securities and Exchange Commission (SEC), Bureau of Internal Revenue (BIR), Social Security System (SSS), Home Development Mutual Fund (HDMF), Philippine Health Insurance Corp. (PHIC), and other permit and license-issuing agencies. Aside from making business registration easier, the Go Negosyo Centers would allow MSMEs to avail of other services such as technology transfer, production and management training programs, as well as marketing assistance from the DTI, Department of Science and Technology (DOST), Cooperative Development Authority (CDA), Technical Education and Skills Development Authority (TESDA), University of the Philippines-Institute for Small-Scale Industries (UP-ISSI), and other agencies concerned.
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2. Bohol weaving industry gets much-needed boost
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he loom weaving industry in Bohol province gets a much-needed boost following the P2-M assistance provided by the United Nations Industrial Development Organization (UNIDO). According to the Department of Trade and Industry (DTI)-7, the assistance provided by UNIDO will be used by the Loom Weavers Cooperative at the Tubigon Loom Weaving Center, in Tubigon, Bohol, to rehabilitate its facility, purchase additional equipment, and accommodate more workers. The facility, which is part of the DTI’s Shared Services Facility (SSF) program, has 150 square meters of working space.
3. Entrepreneurship promoted at local level
According to Caberte, the DTI has partnered with International Designer Francis Dravigni as its consultant in coming up with new woven fabric made from raffia. “He told me to give him eight months to a year, and all these woven raffia fabrics will be in the shops of international signature brands. He is very confident of the quality of our fabrics,” Caberte said. The fabric is woven by some 150 workers of the Loom Weavers Cooperative.
“With the additional financial assistance, we will be able to expand the floor area to add 50 more
Caberte said that with UNIDO’s assistance, the cooperative will be able to double its production, and train pre-selected weavers to produce the specific fabric.
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To further solicit support for SMEs from LGUs, a Baranggay Entrepreneurship Action Plan (BEAP) was also drafted.
eaders of various local government units (LGUs) numbering to the thousands participated in the 3rd Negosyo sa Barangay conducted in Davao City on 22 July 2014. The seminar focused on entrepreneurship development training with talks on the fundamentals of product development and marketing for small and medium enterprises (SMEs).
4. Aklan celebrates SMED Week with information sessions
weavers,” said DTI-7 Director Asteria C. Caberte.
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Trainings were facilitated by the Philippine Center for Entrepreneurship (PCE), Inc. – Go Negosyo and the Center for Future Leadership, Inc. (CFL). The Philippine Trade Training Center (PTTC) assisted in the event. (BWD 07/22)
s part of the celebration of the Small and Medium Enterprise Development (SMED) Week last July, the Provincial Micro, Small, and Medium Enterprise Development Council (PMSMEDC) held Information and Advisory Sessions on Enterprise Development in the Municipality of Lezo, Aklan.
representatives of Landbank of the Philippines who gave advise regarding financing.
MSMEs from the municipality had one-on-one consultations with members of the PMSMEDC who gave guidance on how to optimize their businesses, as well as
For 2014, the theme for the SMED Week was “Strengthening Competitiveness and Sustainability of MSMEs.”
The information sessions was only one of the banner events organized by the Provincial Government of Aklan and PMSMEDC for the SMED Week.
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Among the nine towns in Aklan to receive funding from the Department of Trade and Industry (DTI) through the Grassroots Participatory Budgeting Program (GPBP), Lezo will get
P1.6M of the P5.8M allotted for the province. The funding will be used for skills development training in industries practiced in the town.
Information session discussions
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Production of good quality abacabased products, furnitures, metalcrafts, and potteries Proper packaging and labeling Sourcing of capitalization from cooperatives and rural banks
Industries of Participants
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Abaca by-products Ampaw Chicken broilers Direct-sellers Grocery owners Manufacturers of: - Abaca by-products - Ampaw - Chicken broilers - Metalcraft - Pottery
Source: Bureau of Small, and Medium Enterprise Development (BSMED)
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Business Update 1. Baguio, Benguet businesses get Bagwis
Trainings covered by GPBP
Aklan towns to get GPBP
Abaca macramé Clay-based product making Fiber dyeing Food product enhancement Footwear-making Furniture-making Ironworks Piña weaving
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agwis Seal of Excellence awards have been conferred by the Department of Trade and Industry (DTI) to 107 businesses in Baguio City and Benguet. “This program aims to promote and foster the highest level of business ethics and uphold a fair and honest marketplace through voluntary self-regulation and service excellence,” said DTI-Benguet Provincial Director Freda M. Gawisan.
Banga Ibaja Kalibo Lezo Libacao Malay Nabas Numancia Tangalan
Known before as the DTI-Certified Establishment Program, the DTI Bagwis Program was created in 2006 to increase the quality of traded goods and services at a reasonable price. Awards under the Bagwis Program are categorized into Bronze, Silver, and Gold.
No. of Baguio and Benguet Bagwis awardees Award level Bronze Silver Gold
No. of awardees in Baguio City 20 40 27
No. of awardees in Benguet 4 12 4
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2. Investment Promotion Center opens in Capiz
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he government and private sector of Roxas City, Capiz joined hands to launch an Investment Promotion Center (IPC) and Business Resource Center at the Capiz Government and Business Center (CGBC) last July. “We really hope that we can entice more investors to come in and make Capiz investor-friendly,” Department of Trade and Industry (DTI)-Capiz
Consumer News 1. DTI widens reach to consumers through TV
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he Department of Trade and Industry-Consumer Protection Group (DTI-CPG) partnered with the top three television networks to air infomercials on exercising consumer rights and on sending Balikbayan boxes for the general public’s welfare. The consumer rights infomercial is a 30-second television (TV) material that has a question and answer format on the usual instances concerning consumers’ purchase transactions, while the Balikbayan boxes infomercial is a 15-second TV material showing a Filipino family with a father who is an overseas worker; the father sends a Balikbayan box home to his family that contains products for their personal use.
2. DTI: Convenience stores not exempt from price freeze in typhoon-hit areas
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he Department of Trade and Industry (DTI) said that convenience stores are not excused from price freeze in areas hit by calamities. “Convenience stores located within the areas declared under State of Calamity are covered by the price freeze. Prices of basic goods being sold in these stores must be frozen at their prevailing prices,” DTI Consumer Protection Group (CPG) Undersecretary Victorio Mario A. Dimagiba said. During “normal” times, convenience stores may sell basic necessities and prime commodities only up to
Provincial Director Ermelinda P. Pollentes said during the IPC inauguration, noting that the DTI will share P1M worth of fixtures and information technology (IT) devices to the Center. Pollentes also hoped the center will acquire a Global Positioning System (GPS) to help investors locate possible areas for investments.
“This time, the Department aggressively embarks on the field of television to reach out to more consumers from other areas of the country. For the past two years, the DTI has tapped the film sector and produced infomercials in theater format for captured viewing in cinemas prior to the showing of movies,” DTI-CPG Undersecretary Victorio Mario A. Dimagiba said. The DTI-CPG and its media partners decided to air the infomercials during the news programs of primetime television through TV5, ABS-CBN, and GMA. Dimagiba added that the infomercials will be aired for a month and the department intends to sustain this program until the year ends. 15% mark up over the suggested retail prices, he added. The DTI mentioned that convenience stores are not among the establishments it is monitoring, as they serve mainly ambulant customers and sell fewer products. “For a retail store to be included in the price monitoring, it has to be a major market player that can cater to most of the demands of the consumers and fill the supply gap to a certain extent during times of calamity. Nevertheless, non-inclusion in the monitoring is not tantamount to exemption from any law and policy, or declarations such as price freeze,” Dimagiba said.
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FEATURE Starting a corporate giveaways business
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he corporate giveaways business has good profit potential that anyone can learn even in their spare time. But despite it being easy to study, execution and looking for the right suppliers can be taxing. Business Coach, Inc. President Ruben Anlacan Jr. provides the following basic steps on taking on this business.
• Make a list of suppliers. Be on
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the lookout for suppliers who can provide very unique items which your future customers will love to have. Set up your marketing plan. A mixture of promotional tools is probably best, but the trick is knowing how much budget to allocate to each kind of promotion and how to implement this well. Complete your samples. Build your portfolio of products and services. Make a price list based on your own pricing, after accounting for the costs you have incurred per item. Have these in a file or have actual samples when talking with a client personally and use well-lit photos when attaching them online. Learn new crafts. Uniqueness in this industry comes from customizability and flexibility. Aim for long-term relationships with suppliers. Aim not just to satisfy your clients, but to impress them to the point that they would want to stick with you for years to come.
STATWATCH USD 550M Value of trade between PHL and Switzerland last year
USD 3.51B Value of trade between PHL and Indonesia as of end of 2013
P201.13B Public spending in June 2014; up 44% from same month last year
P2M Value of UNIDO’s assistance to Bohol’s loom weaving industry
8,300 Number of Davao consumers served by the DTI’s Presyo Diskwento Caravan
107 Number of business in Baguio City and Benguet that has been awarded the Bagwis Seal of Excellence
15.54% Growth of PHL exports to Israel in 2013
5.77% Expansion in the local manufacturing sector during the 2010-2013 period
(MAB 07/27)
ASEAN Watch Bilateral trade between PHL, Indonesia gets boost
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he bilateral trade relations between the Philippines and Indonesia would be given another boost after the latter relaxed trade restrictions at its Bitung Port, Department of Trade and Industry (DTI) Secretary Gregory L. Domingo said. This is part of the Association of Southeast Asian Nations (ASEAN) Brunei-Indonesia-MalaysiaPhilippines East ASEAN Growth Area (BIMP-EAGA) effort to promote trade for that sub-region. In anticipation,
there will be roll-on, roll-off (RORO) service for Davao-Bitung, Domingo said. The trade liberalization at the port should be good for both countries, especially since Davao and Bitung are very close to each other and there are existing trade relationships already, he added. Previous reports showed that Indonesia was the Philippines’ 11th biggest trading partner with total trade reaching USD 3.51B, as of end-2013.
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What’s New? (A synopsis of selected book acquisitions at the DTI-library)
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Title : Transforming Economies: Making Industrial Policy Work for Growth, Jobs and Development Publisher : International Labour Organization Author : Salazar-Xirinachs, J M/ Nubler, I/Kozul-Wright, R Call Number : 02 000/03.08/SAL/2014 This book contains analyses of national and sectoral experiences in Costa Rica, the Republic of Korea, India, Brazil, China, South Africa, sub-Saharan Africa and the United States (U.S.). It provides comprehensive guide to how countries have used industrial policy to achieve structural transformation, raise productivity, and create jobs. Also contains practical lessons and fundamental principles for industrial policy design and implementation which are distilled from the country case studies. 402p.
Title : Revised Guidelines and Procedures for Entering into Joint Ventures (JV) Agreements Between Government and Private Entities Publisher : National Economic and Development Authority Call Number : 45 608/03.09.01/ NEDA/2013 This set of guidelines for joint ventures plays important role in promoting public-private partnerships (PPP) in striking a balance between what the people need and how the resources of the private sector could be used to meet such need. It defines the parameters in crafting JV agreements between government agencies and the private sector. It also improves the approval process for JV/PPP proposals by streamlining procedures and establishing competitive challenge modalities. The document also promotes transparency and enhances competition. 42p.
Legend BWD MAB TPS
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Editor-in-Chief/Patricia May M. AbejoManaging Editor/Anne L. Sevilla Associate Editor/Jam H. Raposon Writers/Resty P. Par, Hazel S. Dizon, Joanna D. Cruz, Airiz A. Casta, Kit S. Andaya Design/Layout/Ren C. Neñeria Circulation/Al AquinoTo subscribe, email: publications@dti.gov.ph