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March 24, 2014 1
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March 24, 2014 Vol. 19, 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’s economy posts 7.2-% growth Inside DTI 1. Manufacturing sector gets boost 2. Finnish firms eye projects in PHL 3. DTI highest in net sincerity ratings in fighting corruption among gov’t agencies 4. DTI seeks more concessions under PJEPA 5. DTI accredits 25 laboratories to PNS ISO/IEC 17025 MSME News 1. 1M MSMEs seen in 5 years 2. Demo of Japanese Spray Dryer Machine conducted in CDO 3. SME Roving Academy benefits 16,790 MSMEs 4. DTI plans more SSFs for 2014
Consumers News DTI ensures local products’ safety Feature 1. Made by hand, with soul 2. Metro Manila business, industry hub Statwatch What’s New?
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Focus PHL’s economy posts 7.2-% growth
Vol. 19, No. 06 2
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he Philippine economy grew by 7.2% in 2013, better than the 6.8-% growth in the previous year and notably higher than economists’ 6.0-% target.
strong in 2014, especially that the outlook on the global economy is becoming more favorable and as the domestic economy remains robust.
National Economic and Development Authority (NEDA) Director General Arsenio M. Balisacan said the country remains as one of the best performing economies in Asia, second only to China’s 7.7%.
The agriculture and industry sectors are expected to be vibrant this year as the government promotes linkages between the two sectors.
Balisacan attributed the growth mainly to the services and industry sectors. “This is a remarkable turnout. The economy grew better than our expected target despite the challenges we faced last year, particularly the disasters that struck Central and Southern Philippines in the fourth quarter,” he said. The 6.5-% expansion of the services sector was driven largely by the strong demand for communications, land and air transportation, and storage and services incidental to transport.
1. Manufacturing sector gets boost
For 2014, the government is targeting growth of 6.5%-7.5%. The government is optimistic that the country would achieve its 2014 goals through the following:
• Focus on growing exports • Reduce the cost and improve
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Meanwhile, the industry sector grew by 8.4% in the fourth quarter last year and 9.5% for the full-year.
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“Manufacturing served as the frontrunner, posting double-digit growth of 12.3% in the fourth quarter of 2013,” Balisacan said.
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He remained optimistic that the Philippine economy will remain
Inside DTI
The construction of major infrastructure projects, particularly in the transport sector, is also expected to add fuel to the growth this year and beyond.
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he government has set aside some P2.3B to jumpstart the “Manufacturing Resurgence Program” to further boost investments in the country’s manufacturing sector. Department of Trade and Industry (DTI) Undersecretary for Industry Development and Trade Policy Group (IDTPG) Adrian S. Cristobal Jr. said the funding will be spread
•
the ease of doing business to increase foreign direct investments (FDIs) Improve linkages between agriculture and industry to boost the growth of these sectors Promote increased and enhanced employment opportunities to fully harness the vast potential of highly-talented workforce Implement infrastructure projects, especially in the rehabilitation of calamity areas Focus on major infrastructure projects, especially in the transport sector, as a significant growth factor. (MAL, 01/31)
out across several agencies, namely DTI, the Departments of Energy (DOE), Science and Technology (DOST), and Labor and Employment (DOLE) as well as the Technical Education and Skills Development Authority (TESDA). “For the DTI, we have some funds for the revival of the Industry Development Council. This will
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be the official body in terms of policy making.We also have the Shared Service Facility (SSF) program, under which we will be designing some projects geared toward the manufacturing sector. But we will have a separate budget for this,” Cristobal said. Some of these proposed SSF projects, he said, were expected to provide significant support to boost the local manufacturers’ competitiveness.
Program, the DTI will also coordinate the different interventions to be implemented by the different agencies. The program was based on various sectoral roadmaps, which served as the building blocks for the manufacturing roadmap and the Comprehensive National Industrial Strategy (CNIS), a blueprint for the country’s overall industrial development strategy.
As the lead agency for the Manufacturing Resurgence
2. Finnish firms eye projects in PHL
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ncouraged by the country’s rosy economic prospects and incentives offered by the government, Finnish investors are keen on pouring foreign capital in the country particularly in insurance, construction, and forest management sectors. The Finnish delegation was an offshoot of the trade and investment mission conducted by DTI in October last year in Europe. “We made a pitch then on how good the investment climate is in the Philippines. At that time, we were in a very good situation because we had just gotten a ratings upgrade from Moody’s,” Department of Trade and Industry (DTI) Undersecretary for Trade and Investment Promotions Group (TIPG) Ponciano C. Manalo Jr. said. “These companies from Finland were very interested then in the Philippines as we told them the benefits of investing in our
3. DTI highest in net sincerity ratings in fighting corruption among gov’t agencies
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he Department of Trade and Industry (DTI) remained the most sincere in fighting corruption among government agencies, next to the Office of the President (OP), the 2013 Social Weather Stations (SWS) Surveys of Enterprises on Corruption showed.
business process management industry and we also told them about the opportunities for air service agreements with them,” Manalo said. He underscored the significance of investments from these companies as the Philippines stands to learn much from Finnish firms, particularly in the field of design. “Finland has a huge design industry that we could benefit from and learn from through the Design Center of the Philippines (DCP). Overall, we see huge investment opportunities from Nordic countries,” he said. “We’re very hopeful that we can invite more Nordic countries to invest in the country. As it is, we already have investments from Denmark, which had set up a manufacturing facility in the country for hearing instruments, while a number of retail companies from Europe are now looking at coming here in the country,” Manalo said.
“The DTI proved once again that it is ‘bagwis na ahensya ng gobyerno’ as we maintained ‘Very Good’ net sincerity ratings in fighting corruption in 2013,” DTI Secretary Gregory L. Domingo said.
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Domingo congratulated the DTI employees and urged them to continue serving the Filipinos and doing what is right. He acknowledged the employees’ hard work and dedication even without salary increase. Presented at the "Good Governance Summit 2014” on January 15, the survey results showed DTI getting +58 Net Sincerity Ratings, five points higher than the Department of Health’s (DOH) +53 rating, the second highest among government agencies.
4. DTI seeks more concessions under PJEPA
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he Department of Trade and Industry (DTI) convened a panel to review the Philippines-Japan Economic Partnership Agreement (PJEPA) seeking for more concessions, DTI Undersecretary for Industry Development and Trade Policy Group (IDTPG) Adrian S. Cristobal Jr. said. The country will lobby for greater access of agricultural products and improved terms for the entry of natural persons to Japan, Cristobal said.
The survey was based on face-toface interviews of 951 enterprises’ executives in National Capital Region (NCR), Metro Angeles, CaviteLaguna-Batangas, Metro Iloilo, Metro Cebu, Metro Davao, and Cagayan de Oro-Iligan from July 31-November 29, 2013. Of the 24 government institutions rated, there were five upgrades, nine no-change, 10 downgrades from 2009/2012 to 2013, and two first-time ratings.
According to the Tariff Commission, the PJEPA “aims to facilitate and promote the free transborder flow of goods, persons, services and capital between the Philippines and Japan and strengthen the existing economic relations between the two countries.” “The gains for the Philippines are significant both as a market for exports and source of investments,” said Cristobal. Since the PJEPA came into effect, trade between the two countries has grown more than fivefold.
He added that the government expects the review to cover the trade of industrial goods like steel and motor vehicles.
5. DTI accredits 25 laboratories to PNS ISO/IEC 17025
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he Department of Trade and Industry (DTI), through the Philippine Accreditation Office (PAO), accredited 21 testing and four calibration laboratories to ISO/IEC 17025, the International Standard for the competence of testing and calibration laboratories. Among those accredited, two are government laboratories conducting tests for potable water and drugs–the National Reference Laboratory for Environmental and Occupational Health, Toxicology, and Micronutrient Assay in East
Avenue Medical Center, Quezon City; and for electrical and electronic products–Bureau of Product Standards Testing Center (BPSTC) of the DTI in Bicutan, Taguig City. “A Certificate of Accreditation to ISO 17025 manifests a laboratory’s competence of personnel and system,” PAO Officer-in-Charge Ernani M. Dionisio said. “These accredited testing laboratories were found to be capable and have sound laboratory management system, thus they provide assurance
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of correct and reliable test results on products that they test and subsequently give satisfaction of customers. These test results are used by regulatory agencies or certification bodies for decisions on product compliance with local and international standards,” he said.
and calibrations and provide only the best quality services.
Examples of tests done by these laboratories are minerals and ores, potable water, cement, medical grade oxygen, agricultural (fruits and vegetables), desiccated coconut, fish and other aquatic products, other processed food products, and calibration of test equipment used by the testing laboratories.
In addition, PAO conducted seven office-based assessments and 30 witness audits for its accredited certification bodies, to ensure confidence in the conformity assessment certificates issued by these certification bodies.
PAO conducted a total of 76 surveillance visits to ensure that its accredited laboratories continuously demonstrate competence to perform the tests
MSME News 1. 1M MSMEs seen in 5 years
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he National Competitiveness Council (NCC) is optimistic that the number of micro, small, and medium enterprises (MSMEs) will triple and reach 1M in five years. This after the Department of Trade and Industry (DTI) launched the electronic payment facility (ePayment) for the Business Name Registration System (BNRS) and the Philippine Business Registry System (PBRS). Through the PBRS, government agencies involved in business registration are made accessible through one web-based system and their registration procedures are unified. Meanwhile, the BNRS provides an online platform for BN registration of sole proprietorship. Payment of fees for BN registration can previously be done through over the counter transactions only;
PAO also conducted a total of 37 special assessments based on requests from laboratories for expansion of accredited scopes and additional signatories.
The DTI’s PAO is a member of the International Accreditation Forum (IAF), International Laboratory Accreditation Cooperation (ILAC), Pacific Accreditation Cooperation (PAC), and Asia Pacific Laboratory Accreditation Cooperation (APLAC). with the ePayment facility, the registration, including payment, can now all be done online. The number of businesses that registered in 2013 reached 335,000 despite the absence of an online payment facility, while MSMEs comprised 85% of all businesses in the country. (BMI 01/24) Government agencies linked in PBRS
• Bureau of Internal Revenue (BIR) • Department of Trade and Industry (DTI)
• Home Development Mutual Fund Pag-IBIG (HDMF)
• Philippine Health Insurance Corp. (PhilHealth)
• Securities and Exchange Commission (SEC)
• Social Security System (SSS) ePayment facility partners
• BancNet • Development Bank of the Philippines (DBP)
• Globe Xchange Inc. • Land Bank of the Philippines (LBP)
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2. Demo of Japanese Spray Dryer Machine conducted in CDO
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J
apan’s Nomura Research Institute, with assistance from the Department of Trade and Industry (DTI)-Misamis Oriental, conducted a Technology Demonstration of a Spray Dryer Machine for Coconut Sugar in Cagayan de Oro City as part of a feasibility study assigned to them by the Japan Ministry of Foreign Affairs (MOFA). The feasibility study under Japan’s Official Development Assistance (ODA) looks into the use of technology by Ohkawara Kakohki Co., Ltd., a Japanese small and medium enterprise (SME), to support socioeconomic growth in developing countries. Cagayan de Oro, which has high coconut production and low typhoon incidence, was selected as the pilot area for Ohkawara’s machine, said to be capable of processing a liter of coconut honey to coco sugar in under an hour.
sessions of the techno demo had been carried out. The machine used for the sessions consumed 3kwh and, as it was still undergoing research and development, was in small-scale that would cost P1.3M. Coconut sugar is a healthy substitute to regular table sugar due to its low glycemic index level. Cagayan de Oro techno demo participants
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Cooperatives - Agay-Ayan Multipurpose Cooperative - Calabaylabay Community Multipurpose Cooperative - Dig-aguyan Multipurpose Cooperative - Linabu Agrarian Multipurpose Cooperative Cagayan de Oro City Government Davao industry cluster DTI-Region 11 and Misamis Oriental Zamboanga coconut farmers Media
From December 19 last year to January 10, 2014, 10 two-hour
3. SME Roving Academy benefits 16,790 MSMEs
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he Department of Trade and Industry’s (DTI) Small and Medium Enterprise (SME) Roving Academy drew 16,790 attendees to its 167 sessions held in 16 regions of the country last year since its inception in June. Aspiring entrepreneurs took up 40% or 6,693 of the total recorded participants while those with existing enterprises made-up the remaining 10,097. The SME Roving Academy program has seven stages, including the Export Pathways Program (EPP), and while not all attendees underwent all stages, interventions were focused on enterprises that planned to proceed with the EPP.
Meanwhile, the Department’s Bureau of Export Trade Promotions (BETP) organized 38 market information sessions, seminar-workshops, and trainings, attracting 591 participants, under the Regional Interactive Platform for Philippine Exporters (RIPPLES) used to implement the EPP. “For 2014, we will continue to pursue this program not just to boost the competitiveness of MSMEs nationwide but also to help them generate employment in the countryside and contribute to the country’s gross domestic product (GDP),” DTI Undersecretary for Regional Operations and Development Group (RODG) Zenaida C. Maglaya said.
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SME Roving Academy training topics
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•
4. DTI plans more SSFs for 2014 SSF project objectives
• Increase MSME productivity • Step-up MSMEs level to increase • •
market share Provide MSMEs with better technologies and equipment to boost their competitiveness Solve gaps and bottlenecks in primary industry clusters’ value-chain
Some SSF projects implemented
• Banana powder processing facility • Coco bead production processing • Coco sugar processing facility • Coco twining and weaving facility • Coffee processing facility • Garments-making facility • Heavy-duty sewing machine for bayong production
• Jewellery production facility • Kakanin production facility • Meat production facility • Muscovado sugar production facility • Organic fertilizer production facility • Shellcraft production facility
For new entrepreneurs — Business opportunities — Business registration — Entrepreneurship — Skills training For existing business owners — Basics of exporting — Costing and pricing — Financial management — Managerial skills training — Market intelligence — Marketing management — Packaging and labelling — Product development — Production management — Productivity improvement — Technology application — Trade fair participation — Visual merchandising — Website development
SME Roving Academy stages
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Start-up and capability building Market awareness Market readiness Export readiness Export market entry Export sustainability Export expansion Regions where RIPPLES were conducted in 2013
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1 4A 5 6 7
• • • • •
8 10 11 12 Autonomous Region in Muslim Mindanao (ARMM)
RIPPLES participating sectors
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Food Gifts, décor, and houseware (GDH) Information Technology-Business Process Management (IT-BPM)
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ince its launch last year, more Shared Service Facility (SSF) projects are being arranged by the Department of Trade and Industry (DTI) for 2014 with focus on proposals responsive to the goal of inclusive growth through jobs creation. In the province of Cebu, five cooperatives have already been identified to receive assistance through SSFs this year to prepare them for the Association of Southeast Asian Nations (ASEAN) Economic Community (AEC) in 2015. The budget for SSFs for Zamboanga Peninsula has been raised by 70% from the P27.12M in 2013 and is aimed at big-ticket projects determined to significantly boost job generation in the region. Such project is a village-type rubber processing facility to enable small rubber producers
in Zamboanga del Norte to create value-added rubber goods that fetch higher prices. In 2013, nine SSFs were launched in Zamboanga City. Meanwhile, the SSF project allocation for the Davao region was P10M more than the P24M disbursed last year that saw 51 SSF projects approved, with 34 already being utilized and 17 awarded this year. The SSF project is a key component of the Micro, Small, and Medium Enterprise (MSME) Development Program under the “Big Push” for small and medium enterprises (SMEs). 2014 SSF allocation per area
• • •
Cebu Davao Zamboanga
P59M P34.55M P46M
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Identified Cebu SSF beneficiaries
• • •
Cebu Federation of Dairy Cooperatives, Consolacion Cebu Technological University Metal Industry Association of the Philippines
Distribution of 2013 SSFs in Davao
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Some SSF assisted sectors in Cebu
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Consumer News DTI ensures local products’ safety
Charcoal production Desiccated coconut processing Mango puree production Virgin coconut oil production
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he Department of Trade and Industry-Bureau of Product Standards (DTI-BPS) is committed in ensuring that Philippine products and services conform to relevant Philippine and international standards to safeguard the general public welfare. BPS reported that it generated some P43.125M in fees from its product certification scheme and collected P43.367M from its Import Commodity Clearance (ICC) stickers’ issuance last year. BPS also awarded 125 new Philippine Standard (PS) licenses,
FEATURE 1. Made by hand, with soul
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Davao del Norte Davao Oriental Davao City Davao del Sur Compostela Valley
13 12 11 9 6
Areas for 2014 SSF distribution in Zamboanga
• • •
Zamboanga del Norte Zamboanga del Sur Zamboanga Sibugay
renewed 481 PS licenses, and issued 4,324 ICC certificates. BPS issues PS licenses and ICC certificates to manufacturers and importers of products covered by mandatory PNS, as provided for in DTI-Department Administrative Order (DTI-DAO) 4:2008, DTI-DAO 5:2008, and Republic Act (RA) 4109 or the Standards Law. Products covered by mandatory PNS
• • • • • •
Building materials Chemical products Construction materials Consumer products Electrical home appliances Electronic home appliances
n an age of the shiny, new and mass-produced, handmade pieces show the soul of their makers.
when nature came to her after learning the basics of jewelry making from lessons with the Department of Trade and Industry (DTI).
A bespoke jeweler found her materials and her inspiration in a far province; a designer made her mark through a partnership with indigenous embroiderers; and a weaver helps preserve cultural traditions with a home store which encourages its partner groups to keep on weaving.
Lenora Cabili’s brand, Filip+Inna, speaks volumes about what it attempts to do with its clothes: put a spin on Filipina. She sees her cooperation with native embroiderers as a way of preserving their people’s culture.
Helena Alegre, a mother, a sculptor, and now a jewelry artist, was inspired
Cabili believes in maintaining a relationship with her artisans, and her artisans forming a relationship with her customers. She does this
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by having the embroiderers discreetly stitching their names on the dresses that they work on. Meanwhile, Anya Lim of ANTHILL Fabric Gallery is trying to keep the weaving practice alive. There were two reasons why she decided to promote fabric and its by-products. One was the realization that weaving is a dying art after going to a weaving village in Banaue where the young people chose to become tour guides instead of learning the craft from their elders. The second came during her first trip to India and seeing how much they appreciate traditional wear and learning of Mahatma Gandhi’s great love for his charka (spinning wheel). (BWD 01/23)
2. Metro Manila business, industry hub
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he National Statistics Office (NSO) released its updated List of Establishments (LE) containing data on identification, classification, and maintenance for each establishment. The DTI and NSO, in its coordinative efforts, keep industries and investors posted on the LE, with information and data on their characteristics, demographic indicators, and regional distribution. The National Capital Region (NCR) or Metro Manila had 212,408 or 22.5% of the establishments. Calabarzon (Region 4A) and Central Luzon (Region 3) had the next biggest count with 145,518 (15.4%) and 105,580 (11.2%) establishments, respectively. The list had 945,000 establishments operating in 17 geographic regions and employing 7.81M individuals as of July 2013. (MAB 01/14)
STATWATCH USD 500M GDAP’s target annual revenue for the gaming industry starting 2019
P2.3B Government’s allocation for jumpstarting the Manufacturing Resurgence Program P341.9M New investments in Leyte for 2013 from P307M in 2012
P86.49M BPS’ total revenues from product certification and ICC stickers issuance
P81M Total amount lent by SB Corp. to 55 Typhoon Yolanda-affected MSMEs P59M 2014 allocation for Shared Service Facilities (SSFs) in Cebu
1M Projected number of MSMEs in the PHL in 5 years
212,408 Number of establishments in NCR, according to NSO
16,790 Number of attendees to 167 sessions under the SME Roving Academy from June-December 2013
7,052 Total PBR registrations in Central Luzon for 2013
25 Number of laboratories accredited by PAO to ISO/IEC 17025 including two government labs 7.2% PHL economy’s growth in 2013
2nd DTI’s ranking as most sincere in fighting corruption in the 2013 SWS Survey of Enterprise on Corruption
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(A synopsis of selected book acquisitions at the DTI-TIIC library)
Title : FAO Statistical Yearbook 2013 World Food and Agriculture
Title : Metro Manila Food Manufacturing Source Book
Publisher : Department of Trade and Industry. Bureau of Domestic Trade (DTI-BDT) Call Number : SITC 0/45 608/DTIBDT/2013 This sourcebook helps micro, small, and medium-sized enterprises (MSMEs) in the food sector to look for sources of raw materials, supplies, equipment, and services for their operation. Also contains contact information and products/ services offered by 1,092 companies. Aside from finished and semi-finished products and components, other elements of a food manufacturing business are included: equipment, tools, packaging materials, and services from government and private sector agencies. 285p. Copies are available for sale at the: BDT, G/F Trade and Industry Bldg., 361 Sen. Gil Puyat Ave., Makati City Tel. No.: 751.3223 P200.00/copy
Publisher : Food and Agriculture Organization Call Number : STAT/00 000/FAO/ 2013 This yearbook is a collection and reference point for statistical data on food and agriculture that provides a snapshot of related economic, environmental, and social trends and issues. It presents visual synthesis of the major trends and factors shaping the global food and agricultural landscape and their interplay with broader environmental, social, and economic dimensions. 356p.
Philippine Postal Permit No. PM-04-08
What’s New?
Vol. 19, No. 06 10
Legend: BWD MAB MAL
- Business World - Manila Bulletin - Malaya
Entered as Third-Class Mail at the Makati Central Post Office under Permit No. PM-04-08 valid until 31 December 2014
Editor-in-Chief/Anne L. Sevilla Managing Editor/Vic S. Soriano Associate Editor/Jam H. RaposonWriters/Resty P. Par, Hazel S. Dizon, Joanna D. Cruz, Airiz A. Casta, Kit S. Andaya Design/Layout/Ren C. Neneria Circulation/Myrna V. De Los ReyesTo subscribe, email: publications@dti.gov.ph