Dataline 02 (2013) by Department of Trade and Industry

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January 28, 2012 1

January 28, 2013 Vol. 17, No. 02

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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 Top business execs bullish on PHL economy

Business Alert Mindanao food processors urged to join IFEX 2013

Inside DTI 1. 10 DTI offices cited Government services pass CSC quality test 2. More investments eyed for Iloilo

Consumer News 1. 2013 starts with higher tobacco, alcohol prices 2. LTO to arrest riders without the prescribed helmet stickers

Good News, Philippines! 1. Q3 domestic trade hits P130.9B 2. Jewelry makers see robust growth 3. Citi, HSBC see bright prospects for PHL 4. PHL positioned as one of top global markets in 2013

Features Contact Center ng Bayan text facility launched

MSME/OTOP News 1. “Nueva Vizcaya Goes to Alabang” earns P40M 2. DTI-Albay participates in MDG-FACES

Statwatch

ASEAN Watch 1. Myanmar business execs to visit PHL 2. Benefits of doing business in PHL cited

What’s New?

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Focus Top business execs bullish on PHL economy

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op business executives in the Philippines were optimistic that the country’s economy this year would be better than it was last year. Leaders of the largest corporations here are expecting faster economic growth and the Philippines finally getting investment-grade status, which is expected to pave the way for more foreign investments to pour into the country. “This year’s good economic fundamentals—benign inflation, high foreign exchange reserves, and low interest rates—provide a good springboard for a rosy 2013 outlook,” said Holcim Philippines Chief Executive Officer (CEO) Eduardo A. Sahagun.

Similarly, EastWest Bank President and CEO Antonio C. Moncupa Jr. noted that the “growth fairies seem to be favoring the country.” “We believe we stand on good foundation. We expect the macro numbers—gross domestic product (GDP) growth, loans-to-GDP ratio, the fiscal deficit, government revenue collections—to continue showing good numbers,” Moncupa said. RFM Corp. CEO Jose Concepcion III said 2013 would be a “super year” for the Philippines, partly because elections will help boost consumption. As a result, the stock market should hit even more records this year, he said. Pepsi-Cola Products Philippines President Partho Chakrabarti said the overall optimism of the population would result in increased investment and spending by both companies and individuals.

“Confidence will continue to increase in 2013 and should be higher than 2012. The increased activities around the elections will further stimulate the economy in the first half,” said Chakrabarti. Sun Life Financial Philippines CEO Rizalina G. Mantaring gave a similar rosy projection for the Philippines in 2013, saying that the economy would continue to “grow strongly” because of strong domestic consumption. “It is already the third largest of the USD 1 trillion-plus Association of Southeast Asian Nations (ASEAN) consumer market, and we expect to continue to move up as we have a young and still growing population with growing purchasing power,” Mantaring said. San Miguel Corp. President Ramon S. Ang said the economy will continue to become strong mainly because “investors believe in our President and his good image.” The Philippine Chamber of Commerce and Industry (PCCI), the largest umbrella organization of more than 30,000 enterprises in the country, also projected a stronger Philippine economy in 2013 because of two significant events— the start of US President Barack Obama’s second term and the midterm elections in the country. “The Philippine economy in 2012 has shown resiliency and strength amid the economic crisis in Europe and territorial disputes in the region. This is mainly due to our government’s effective fiscal management policies which created a stronger-thanexpected investors’ interest in the Philippines,” said PCCI President Miguel B. Varela. (PDI 12/29)

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Inside DTI 1. 10 DTI offices cited Government services pass CSC quality test

January 28, 2012 3

en Department of Trade and Industry (DTI) offices were among the 27 government offices awarded with the Citizen’s Satisfaction Center Seal of Excellence by the Civil Service Commission (CSC) for 2012. Based on the Report Card Survey (RCS) conducted by the CSC, 305 out of 594 government offices nationwide garnered a rating of Good, with numerical scores between 80 to 90. Another 50 offices obtained Excellent rating, the highest in the scale with scores from 90 to 100. “Our anti-red tape campaign is beginning to gain ground. The results of RCS are based on actual client observations and feedback so with these favorable findings, we believe there is renewed confidence from citizens on the quality of government services,” CSC Chairman Francisco T. Duque III said. The RCS is a survey tool used to rate frontline service delivery in terms of compliance with the requirements of Republic Act (R.A.) No. 9485, otherwise known as the Anti-Red Tape Act (ARTA) of 2007. Factors considered include the posting of the agency’s Citizen’s Charter, which includes a listing of frontline services offered, step-by-step procedures, time needed to complete the transaction, requirements and amount of fees, among others. Also checked by the CSC was the observance of the “No Noon Break” policy, presence of a public assistance desk/center; availability of basic facilities such as comfortable waiting areas and comfort rooms; and special lane for persons with disabilities, pregnant women, and the elderly. The survey covered client-heavy agencies such as the DTI, Bureau

of Internal Revenue (BIR), Land Transportation Office (LTO), Social Security System (SSS), Philippine Health Insurance Corporation (PhilHealth), Department of Health (DOH) as well as provincial, municipal, and city government offices. “These offices represent the bureaucracy’s best in terms of frontline service delivery. They have taken the extra mile to curb red tape and ensure that the public gets their taxes’ worth,” said Duque. Citizen’s Satisfaction Center Seal of Excellence Awardees for 2012 Department of Trade and Industry (DTI) – Region 3; Tabuk, Kalinga Provincial Office; Region 4A (Calamba City, Laguna); Malolos City, Bulacan; San Fernando City, Pampanga; Siquijor; Bacolod City Provincial Office; Iloilo City; Roxas City, Capiz Field Office; and Cabanatuan City, Nueva Ecija Department of Foreign Affairs – (DFA) Clark Satellite Office; Land Transportation Office – Urdaneta Service Office Bureau of Internal Revenue (BIR) – District Offices in Victorias City; Bacolod City; Parañaque City; Catarman, Northern Samar; Gingoog, Misamis Oriental; Las Piñas City; North District Nueva Ecija; Cebu City; Sta. Cruz, Manila Philippine Health Insurance Corporation (PhilHealth) – Regional Office No. 4B (Batangas City); Puerto Princesa City, Palawan; Marawi City, Lanao del Sur; Santiago City, Isabela; Passi City, Iloilo; Kabankalan, Negros Occidental; Bacolod City National agencies – Social Security System – Catanduanes Branch; National Statistics Office – Naga City City governments – Gingoog, Misamis Oriental; Lamitan, Basilan; Mabalacat, Pampanga Municipal governments – Upi, Maguindanao; Datu Odin Sinsuat, Maguindanao; Loboc, Bohol

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2. More investments eyed for Iloilo

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he Department of Trade and Industry (DTI)-Iloilo expected an increase in investments this year especially in business process outsourcing (BPO) and tourism sectors. DTI-Iloilo Provincial Director Wilhelm M. Malones said they looked forward to preparing the city and province of Iloilo to become more business-friendly with the help of the Project Investment Enabling

Good News, Philippines! 1. Q3 domestic trade hits P130.9B

he value of commodity flow within the country rose by 20.8% to P130.9B in the third quarter of 2012 from the P108.4B recorded in the same period of 2011, data from the National Statistics Office (NSO) showed. Trade transactions through shipping comprised 99.3% and 99.6% in the third quarter of 2011 and 2012, respectively. The total quantity of domestic trade transactions in the third quarter of

2. Jewelry makers see robust growth

3. Citi, HSBC see bright prospects for PHL

Environment Project (INVEST) of the United States Agency for International Development (USAID). “We are looking at Iloilo as one of the country’s Next Wave Cities, an ideal destination both for voiced and nonvoiced BPOs,” Malones said. The new policy of the Philippine Economic Zone Authority (PEZA) provided more incentives to those that will relocate to Cebu, he said. 2012 increased by 32.9% to 5.7M tons from 4.3M tons reported during the same period of 2011. (TMT 01/02) Top 3 trade commodities for Q3 2012 Commodity Food and live animals Machinery and transport equipment Manufactured goods

Value (in P billion) 39.2 20.9 20.2

omestic demand for jewelry, especially silver, has been increasing since the second half of 2012, boosting hopes for a 10%-30% revenue growth this year.

“People have money to buy. We have been feeling the huge orders since the second quarter of 2012 and this is increasing compared to 2011,” Ramos said.

Meycauayan Jewelry Industry Association, Inc. (MJIA) Chairman of the Board Cecille Ramos said strong local demand has helped offset weak exports especially in the United States (U.S.).

She said their largest buyers are retail stores in the malls, noting that the sector's revenues are expected to further increase should more Filipinos patronize locally made products. (Sun 12/09)

excise tax reforms, accelerated bidding of key public-private partnership (PPP) projects, and a credit-rating upgrade.

lobal financial institutions Citigroup and HSBC projected the Philippine economy to grow in 2013 by 6.1% and 4.9%, respectively, citing accelerated government spending and stable domestic demand. Citi Philippine Equity Research Head Minda Olonan said the Philippines would benefit from more pronounced growth drivers such as

“The government’s efforts to increase efficiency of fiscal spending and revenue collection gave room to counter-balance the global slump with increased expenditure,” HSBC Economist Trinh Nguyen said. (PDI 12/28)

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4. PHL positioned as one of top global markets in 2013

January 28, 2012 5

lobal investment bank JP Morgan picked the Philippines as one of its three most-favored stock markets for this year, marking the fourth straight year that the country is expected to outperform most of its regional peers. The two other Asian markets seen by JP Morgan as top market picks for this year are Thailand and India, citing favorable demographics as a common denominator with the Philippines. At the beginning of 2012, JP Morgan also cited the Philippines as among

MSME/OTOP News 1. “Nueva Vizcaya Goes to Alabang” earns P40M

2. DTI-Albay participates in MDG-FACES

he Department of Trade and Industry (DTI)-Nueva Vizcaya’s “Nueva Vizcaya Goes to Alabang 2012” trade fair earned P40M in sales, or 30% better than the P28M sales in 2011. The annual event promotes the province’s One Town, One Product (OTOP) program and gives the micro, small, and medium enterprises (MSMEs) in the province opportunities to showcase their products and explore new markets.

its most favored markets along with Thailand and Indonesia. JP Morgan Securities Philippines Inc. Executive Director and Head of Equity Research Gilbert Y. Lopez said JP Morgan had an “overweight” rating on Philippine equities for the last four years. An “overweight” rating refers to a recommendation to buy in excess of the prescribed weight. “The reason we like the Philippines is that in a global context, earnings environment is still good,” Lopez said. (PDI 11/30)

of the annual trade fair,” DTI-Nueva Vizcaya Planning and Information Officer Ellerie Mila G. Ramel said. Relatedly, the office is promoting the Basket/Bayong from Bamboo and Banana (4Bs) program to encourage entrepreneurs venture on materials available in the province.

“Year 2012 was a record-breaking period in terms of sales in the history

DTI-Nueva Vizcaya Senior Trade and Industry Specialist Clifford R. Gregorio cited success stories of MSMEs who ventured on local raw materials because of their exposure to regular trade fairs and marketing events outside the province.

the local production of seaweed for processing into noodles and other food supplements as entrepreneurial initiatives.

he Department of Trade and Industry (DTI)-Albay has provided capacity training services for the Millennium Development Goals-Family Action Based for Children in their Environs of the Slums (MDG-FACES) project. The MDG-FACES is one of Tabaco City’s anti-poverty projects that engage selected families in the slums to find solutions to problems in the environment, food, and health directly affecting the quality of children’s life. Tabaco City Mayor Cielo Krisel Lagman-Luistro said the program was initially identified to strengthen

The DTI has provided various training such as simple bookkeeping while the Department of Labor and Employment (DOLE), through Nego-Kart projects, has offered four carts for product display. The City Social Welfare and Development Office (CSWDO) has also initiated values re-orientation and family development session and seminar on food safety and good manufacturing practices to assist women on their business.

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Business Alert Mindanao food processors urged to join IFEX 2013

Vol. 17, No. 026

he Department of Trade and Industry (DTI)-Center for International Trade Expositions and Missions (CITEM) is urging Mindanao food processors to join the International Food Expo (IFEX) slated on May 16-19, 2013 at the Mall of Asia Complex in Pasay City. IFEX Philippines Project Director Leah P. Ocampo said Mindanao producers are very important as the

Consumer News 1. 2013 starts with higher tobacco, alcohol prices

epartment of Finance (DOF) Secretary Cesar V. Purisima has signed Revenue Regulations No. 17-2012 implementing Republic Act (R.A.) No. 10351 or the Sin Tax Law that requires additional taxes from cigarettes and distillery companies.

majority of food products being offered are from the island-region. She added that Mindanao holds two products that are widely traded in the international market, namely coco sugar and virgin coconut oil. IFEX Philippines Project Coordinator Anjo Abrillo said the upcoming exposition is an Asianwide event that will help entrepreneurs widen their market reach. The regulations exempt distillers from paying the excise tax, but not income and value-added taxes (VAT). The ad valorem tax rate will be 15% of the retail price, plus P20 specific tax per proof liter. (MAB 12/27)

Quick reference on the new tax rates Tobacco products • Cigarettes packed by hand (this comprises bulk of tobacco products produced in the country) - P12.00 per pack • Cigarettes packed by machine - P12.00 if the cost per pack is P11.50 or below; P25 for packs that cost more than P11.50 • Cigars - additional P5.00 per cigar Alcoholic beverages • Distilled spirits - P20 per proof liter • Sparkling wines/champagnes - P250 if the net retail price (excluding the excise tax and VAT) per bottle of 750 ml is P500 or less; - P700 if the cost is more than P500 • Still wines and carbonated wines containing 14% of alcohol by volume or less - P30.00 • Still wines and carbonated wines containing more than 14% of alcohol by volume but not more than 25% of alcohol by volume - P60.00 • Fortified wines containing more than 25% of alcohol by volume shall be taxed as distilled spirits • Fermented liquors: - P15 if the net retail price (excluding excise tax and VAT) per liter of volume capacity is P50.60 or less - P20 if the net retail price (excluding excise tax and VAT) per liter of volume capacity is more than P50.60 - P28.00 for fermented liquors brewed and sold at microbreweries or small establishments such as pubs and restaurants, regardless of the net retail price (Interaksyon 1/1, Rappler.com 1/1)

2. LTO arrests riders without the prescribed helmet stickers

ignalling the start of implementing Republic Act (R.A.) 10054 of 2010, or the Motorcycle Helmet Act, Land Transportation Office (LTO) officers

have started apprehending riders who sport helmets without the Import Commodity Clearance (ICC) stickers or Philippine Standard (PS) mark effective January 2 this year.

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January 28, 2012 7

Violators were fined P1,000 for the first violation, and will be fined P3,000 for the second, P5,000 for the third, and P10,000 for the fourth and succeeding violations. The last penalty includes driver’s license confiscation.

Features Contact Center ng Bayan text facility launched

n addition to the hotline 1-6565, the Contact Center ng Bayan (CCB) – a facility that opens government lines for public concerns, suggestions, and complaints – can now be reached by sending text messages to 0908.881.6565. Civil Service Commission (CSC) Chairman Francisco T. Duque III said opening additional channels or means to reach the CCB will make it easier and more convenient for the public to complain about inefficiency, discourtesy, and fixing in government services. ‘‘Through the CCB, we aim to engage citizens to be the primary drivers of the kind of service they want to get from their civil servants,” said Duque. Launched on September 27, 2012, the CCB includes six government agencies for its initial implementation, namely:

ASEAN Watch 1. Myanmar business execs to visit PHL

group of businesspeople from Myanmar planned to visit the country early this year for possible investment opportunities. Philippine Chamber of Commerce and Industry (PCCI) President Miguel B. Varela said the Myanmar business group is in talks for the planned business mission, noting

ICC stickers for the imported and PS mark for the locally-made helmets assure that the products have passed the quality prescribed by DTI’s Bureau of Product Standards (BPS).

• National Computer CenterInformation and Communications Technology Office (NCC-ICTO) • Bureau of Internal Revenue (BIR) • Philippine Health Insurance Corporation (PhilHealth) • Department of Health (DOH) • Department of Trade and Industry (DTI). The project is part of the unified efforts of continuously improving the country’s global competitiveness rankings and in consonance with the provisions of Republic Act (R.A.) No. 9485, or the Anti-Red Tape Act (ARTA) of 2007 requiring all government agencies to interconnect their current and future public assistance systems with the government-wide citizen’s helpline. The CCB is accessible nationwide using PLDT, Smart, and Digitel landlines, Mondays to Fridays, from 8 a.m. to 5 p.m. Each call to 1-6565 is charged P5 plus value added tax (VAT).

that the firms are interested in the agriculture sector. The Department of Trade and Industry (DTI) said the increase in the number of foreign firms visiting the Philippines shows confidence in the business environment as the country is experiencing strong economic growth. (TPS 01/02)

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2. Benefits of doing business in PHL cited

Vol. 17, No. 028

n an investment forum with Chief Executive Officers (CEOs) and business development executives of top companies in Japan, KPMG Chief Operating Officer and Head of Tax of Manabat Sanagustin & Co. Emmanuel P. Bonoan recently spoke on how doing business in the Philippines could benefit their organizations. Bonoan said the Philippines' attractiveness as an investment destination is at an all-time high as Japanese companies seek to lower their costs of production, expand their supply chain network, and manage the risks associated with concentrating their facilities in one location. He also cited President Benigno S. Aquino III’s dedication to good governance as reason for the improved investment climate in the Philippines. Held in Tokyo, Osaka, and Nagoya in Japan on November 20 to 22, 2012, the event was attended by close to 500 individuals from Japanese private companies, industry associations, and government. Among the event’s speakers was Philippine Economic Zone Authority (PEZA) Director General Lilia B. De Lima who spoke about the advantages of locating one’s business in PEZA. The forum was jointly organized by KPMG Philippines, KPMG ASZA (Japan), Bank of Tokyo MitsubishiUFJ, and the Japan External Trade Organization (JETRO). (KPMG 12/10)

STATWATCH P130.9B Value of commodity flow within the country in Q3 2012 vs.

P108.4B

in Q3 2011

P40M Sales in “Nueva Vizcaya Goes to Alabang 2012” vs.

P28M in 2011”

5.7M tons Total quantity of domestic trade transactions in Q3 2012

305 Government offices nationwide garnering good rating with numerical scores between 80 to 90, based on the Report Card Survey (RCS) conducted by the Civil Service Commission (CSC) for 2012

50 Government offices nationwide garnering Excellent rating, the highest in the scale with scores from 90 to 100, based on the RCS conducted by the CSC for 2012

10 Department of Trade and Industry (DTI) offices awarded with the Citizen’s Satisfaction Center Seal of Excellence by the CSC for 2012

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January 28, 2012 9

Title: Start Your Own Food Truck Business

What’s New? (A synopsis of selected book acquisitions at the DTI-TIIC library)

Title: The Small Business Startup Workbook: A Step-by-Step Guide to Starting the Business You’ve Dreamed of

Publisher : McGraw-Hill Author : Cheryl D. Rickman Call Number : SITC 00/06.08/MCG/ 2012 The book provides an overview of the mobile food industry. It gives information on how to start a food truck business particulalry cart and concession trailers, kiosks, standard and gourmet trucks, mobile catering, and bustaurants. It provides useful tips on identifying customers and service niche; creating mobile menu; choosing and outfitting vehicle or kiosk; securing licenses, zoning parking, and other considerations; hiring personnel; setting prices; and scouting and staging for conducting business. This material also includes recipes, shopping lists, and favorite equipment buys of some practicing experts on the business.

Publishers : Rupa Publications India Pvt. Ltd. Call Number : 06.08/RIC/2011 This workbook offers a modern approach to self-employment and business start-ups. Packed with reallife case studies and practical exercises, checklists and worksheets, it provides a step-by-step guide to researching and formulating business ideas. This fresh approach to small business start-up also includes information and recommendations on making business ethically and socially responsible, along with exercises to help build self-confidence and visualize success.

Legend: MAB - Manila Bulletin PDI - Philippine Daily Inquirer SUN - Sun Star TMT - The Manila Times TPS - The Philippine Star Interaksyon KPMG

Rappler.com

Editor-in-Chief: Anne L. Sevilla Managing Editor: Vic S. Soriano Associate Editor: Resty P. Par Writers: Jam A. Hourani, Elaine M. Lazaro, Emman R. Caleon Design/Layout: Ren C. Neneria To subscribe, email: publications@dti.gov.ph