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May 19, 2014 1
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19 May 2014 Vol. 19, No. 10
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 exports hit 3-year high Inside DTI DTI cautions businesses on solicitations Good News, Philippines! 1. PHL seen to sustain rise in FDIs 2. Singaporeans eager to invest more in PHL MSMEs 1. Negosyo Centers pushed 2. Baguio barangays get funds for livelihood projects 3. DTI conducts ‘diskwento caravan’ in Batangas Business Update 1. PEDP scales down exports goal 2. Peso depreciation in Q1 to benefit medium-term growth 3. Businesses urged to adjust to PHL’s evolving digital landscape 4. Sustained growth for IT-BPO sector seen
Consumers News 1. DTI pushes amendments to Consumer Protection Law 2. Local firms apply for Madrid System trademarks 3. DTI-4A enhances mediation and arbitration process Feature DTI to showcase 2 editions of Sikat Pinoy Food Fair Asian Watch 1. DTI to review Asian neighbors’ tax regimes 2. ASEAN integration good for telco industry Statwatch What’s New?
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Focus PHL exports hit 3-year high
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hilippine exports grew by 24.4% to USD 4.65B in February this year over the USD 3.74B recorded in the same period last year to post a three-year high expansion, data from the Philippine Statistics Authority (PSA) showed. The February growth was faster than the 9.2% registered in January 2014, and the fastest since December 2010 when exports rose 26.5%.
in February 2014, led by Viet Nam and the Philippines,” Esguerra said. Department of Trade and Industry (DTI) Secretary Gregory L. Domingo said export revenues in 2014 will likely grow by 10% on the back of the recovery of the electronics sector. Domingo said the depreciation of the peso will boost exports as it will make locally-made products more competitive. (PDI 11/04; TPS 14/04)
Shipments of electronic products, including semiconductors, made up 40.4% of total exports in February at USD 1.88B up 26.6%. The Philippines supplies about 10% of the world's semiconductor manufacturing services, including for mobile phone chips and micro processors. The growth in exports for the month reflected higher demand for the country’s products overseas, fueled by improved economic conditions of major trading partners such as China, Japan, and the United States (U.S.). “Compared to the manufacture-driven growth in January 2014, the export performance in February 2014 was more broad-based, as all major commodity groups registered gains,” National Economic and Development Authority (NEDA) Deputy Director- General Emmanuel F. Esguerra said. “Most of the selected economies in the East and Southeast Asian region posted positive export growth rates
Inside DTI DTI cautions businesses on solicitations
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he Philippine Retailers Association (PRA) has notified the Department of Trade and Industry (DTI) that certain individuals are soliciting for financial assistance using the name and office of Consumer Protection Group (CPG) Undersecretary Victorio
PHL top export winners February 2014 (In Million USD) Sector
Amount Growth
(In %)
Electronic products 1,880.41 26.6 Other manufactures 378.08 16.7 Woodcrafts 341.07 55.6 and furniture Machinery 252.17 91.8 and transport equipment Chemicals 202.85 65.7 Other mineral 152.99 130.9 products Electronic equipment 126.26 121 and parts
PHL top export markets February 2014 (In Million USD) Country
Amount
Japan China United States of America (USA) Hong Kong Singapore
665.70 682.83 625.08 327.84 311.06
Mario A. Dimagiba reportedly as a fund-raising activity for senior citizens. The PRA’s report followed the earlier account of accredited sea freight forwarders to CPG’s Philippine Shippers’ Bureau (PSB) that some
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individuals are requesting for financial assistance to help calamity victims. The CPG strongly denies the said act of solicitation and involvement in such activity.
from any individual or entity as a government official and as an office. Again, there is a proper government agency mandated, this time, to look after the welfare of senior citizens,” Dimagiba said.
“This is to reiterate that we are not allowed to solicit cash and goods
Good News, Philippines! 1. PHL seen to sustain rise in FDIs
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he Philippines is expected to attract more foreign investors, particularly those who are willing to stay for the long haul, as the local economy continues to grow despite challenges abroad. Bangko Sentral ng Pilipinas (BSP) Deputy Governor Diwa C. Guinigundo said the growth in foreign direct investments (FDIs) seen in January 2014 would likely be sustained in the coming months. “I don’t see any reason why not. Investments came in and, in fact, that was during challenging times,” he said. Latest data from the BSP showed that long-term investments
in the country rose by 5.3% to over USD 1B in January. FDIs come in the form of multinationals lending money or keeping profits with their Philippine subsidiaries, as well as new investments in the country for the purchase of new equipment and construction of facilities. Guinigundo said the entry of FDIs in January showed more serious investors were still willing to put their money in the Philippines, confident of the country’s prospects. “We would expect the same confidence would be maintained and investors would continue to come in. We have a lot to offer,” he said. (PDI 17/04)
2. Singaporeans eager to invest more in PHL
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he recent visit of a 19-member Singaporean business delegation to the Philippines is expected to increase cross-border trade and investment between the two countries that could result in more jobs for Filipinos. “As we sustain economic growth, we are able to work and talk with you in terms of areas for Singapore and the Philippines to expand, invest in infrastructure, and focus on connectivity in our regions,” Department of Trade and Industry -Trade and Investment Promotions Group (DTI-TIPG) Undersecretary Ponciano C. Manalo Jr. said during the recent trade and investment briefing
for the Philippines-Singapore Business Council (PSBC) business mission. Investment areas eyed by Singaporeans
• • • • • • •
Aerospace development and aircraft maintenance, repair and overhaul (MRO) services Business process management (BPM) Disaster mitigation and prevention Electronics manufacturing services Health Information technology (IT) services Shipbuilding
“The business community in the Philippines and Singapore can work
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strongly to provide outside investments for Singapore. At the same time, it is our goal to provide inclusive growth to Filipinos,” Manalo said.
economic ties between the two countries,” PSBC Singapore Co-Chair and Head of Business Delegation Loh Chin Hua said. (TMT 20/04)
“We are confident that our trip will contribute toward strengthening
MSME News 1. Negosyo Centers pushed
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lawmaker is pushing for the passage of a measure that would strengthen the micro, small, and medium enterprises (MSMEs) sector, which plays an important socio-economic role in the nation's machinery. Congressman Winston Castelo filed House Bill 4015 that seeks to promote more participation from the private sector in the MSME Development (MSMED) Council. The bill has the potential to assist MSMEs to integrate themselves in the formal economic market, which will generate more jobs and enhance the growth of the nation's economy, Castelo said.
2. Baguio barangays get funds for livelihood projects
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he Department of Labor and Employment (DOLE) turned over sewing machines and materials to Barangay Dizon Manzanillo with a total cost of P265,875. The livelihood project is a collaborative program of various government agencies and the office of Congressman Nicasio Aliping Jr. The congressman’s office made the recommendations, the Department of Trade and Industry (DTI) and Technical Education and Skills Development Authority (TESDA) provided the trainings while DOLE provided funds for the project by way of materials and equipment.
The bill provides a Start-up Fund for MSMEs to be sourced from the MSME Development Fund and Barangay Micro Business Enterprises (BMBEs) to provide financing for the MSMEs development and promotion in the economy’s priority sectors. Under the measure to be known as the ‘Go Negosyo Act of 2014,’ a ‘Negosyo Center’ shall be established in all provinces, cities, and municipalities under the MSMED Council supervision. The Department of Trade and Industry (DTI) shall create a unified and simplified business registration form which shall be made available in all Negosyo Centers.
Ten other livelihood programs in different barangays received funds amounting to P1.7M. Livelihood projects
Amount (Php)
A bakery for Upper and Lower Dagsian A mini grocery for Holy Ghost Extension Meat processing project for Brookespoint A bakery for Crystal Cave Peanut butter production of Mines View Knitting and weaving of Gibraltar Meat processing of Sto. Tomas Proper
499,180 417,455 228,825 207,795 100,000 100,000 100,000
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3. DTI conducts ‘diskwento caravan’ in Batangas
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he Department of Trade and Industry (DTI)-Batangas and the Citimart Supermarket jointly hosted the three-day ‘Diskwento Caravan’ at the Batangas City Convention Center last month.
undertakings like the ‘price-cut’ sale to help the consumers and public tide over the soaring prices of consumer items, DTI-Batangas Provincial Director Ruel R. Gonzales said.
The caravan provided Batangueño consumers and shoppers with reduced and discounted prices of basic commodities and foodstuff.
Citimart has already conducted the ‘diskwento caravan’ twice with the first discount sale held in its branch in Tanauan City in March, Citimart Supermarket Proprietor Fely Go said.
The DTI continues to link with private companies and businesses for joint
Business Update 1. PEDP scales down exports goal
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he first draft of the new Philippine Export Development Plan (PEDP), which is expected to be released this month, is unlikely to retain the USD 120-B goal for 2016. “We need to set a still ambitious but realistic target. USD 120B is not achievable unless there is a miracle,” Department of Trade and Industry (DTI) Secretary Gregory L. Domingo said as the DTI slashed its exports projections. Under the approved PEDP 2011 to 2013, the goal is to double the value of total exports by 2016. The country ended 2013 with total exports
2. Peso depreciation in Q1 to benefit medium-term growth
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he Philippine economy is projected to have strengthened gross domestic product (GDP) and increased export revenue in medium term after the local currency manifested depreciation against USD in the first quarter of 2014. “[The depreciation of the Philippine peso] only makes our products
3. Businesses urged to adjust to PHL’s evolving digital landscape
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-based businesses must adapt to the Philippine Internet’s ever-changing landscape and the behavior of today’s young "millenials," key executives of the country’s top companies stressed
covering merchandise goods and services valued at USD 75.5B. For this year, Domingo forecasts a 6.8-% grow for total exports to reach USD 82B. Meanwhile, a roadmap detailing the country’s exports strategy for the last three years is expected to be completed this month. Export Development Council (EDC) Executive Committee Member Alfredo M. Yao said they have finished consultations and have drafted the outcome last April. The final plan is for submission to President Benigno S. Aquino III for approval. cheaper, which means they’ll be easier to sell abroad,” Department of Trade and Industry (DTI) Secretary Gregory L. Domingo said. Domingo said the weak peso's impact on the GDP figure is only a 'temporary dip' and that it will support the GDP numbers on the medium term. (MST 15/4) in the forum entitled "Anticipating the Next 20 Years of the Philippine Internet.” PLDT Head for ALPHA Enterprise Juan Victor I. Hernandez said due
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to the recent fiber infrastructure build-out that allows for the growth of the local e-commerce, the only challenge would be addressing the needs of existing companies. “They have to adapt and change. That way, they can compete not just
4. Sustained growth for IT-BPO sector seen
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omegrown company Diversified Technology Solutions, International Inc. (DTSI), after attending the 2014 International Outsourcing World Summit (OWS) in Florida, United States (U.S.), said the growth of the Information Technology and Business Process Outsourcing (IT-BPO) sector in the Philippines will not experience a slowdown. U.S. and multinational companies at the OWS, organized yearly by the International Association of Outsourcing Professionals (IAOP), expressed interest in making the Philippines their outsourcing hub, the DTSI Group reported. The company looks to further promote the country through regular attendance in events like this year’s OWS, held last 17 to 19 February,
Consumer News 1. DTI pushes amendments to Consumer Protection Law
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he Department of Trade and Industry (DTI) is pushing for amendments to the Consumer Protection Law such as higher penalties and measures covering online transactions. The DTI intends to update Republic Act No. 7394 or the Consumer Act of the Philippines approved in 1992 by introducing amendments, DTI Consumer Protection Group (CPG) Undersecretary Victorio Mario A. Dimagiba said. “We are now on the stage of proposing amendments to our
domestically but also perhaps against global firms," Hernandez noted. The growing trend among young entrepreneurs indicates that the future of e-commerce is in the hands of the younger generation, he said . (MAB 22/4)
where the DTSI Group served as a Global Service Mall Sponsor. “We really need to be more aggressive than ever as the country’s competitors are trying to capture a bigger share of the market,” DTSI Group President and Chief Executive Officer (CEO) Miguel Antonio C. Garcia said. The country’s IT-BPO industry grew by 16% in 2013, with USD 15.5B in revenues and employed more than 900,000 workers. For 2016, the Information Technology and Business Processing Association of the Philippines (IBPAP) aims to produce USD 25B in revenues and 1.3M jobs, a target that the DTSI Group deems achievable. (MAB 13/4)
Consumer Protection Law like increasing the penalties,” Dimagiba said. The DTI also wants to include online commerce in the law to protect consumers who purchase goods via the Internet, he said. “We have been receiving a lot of complaints on online commerce, particularly on the very cheap products being sold which seem too good to be true,” he added.
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2. Local firms apply for Madrid System trademarks
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he Intellectual Property Office of the Philippines (IPOPHL) said 61 applications by Philippine companies have been filed for international trademark registration under the Protocol Relating to the Madrid Agreement or Madrid Protocol of the Madrid System for the International Registration of Marks (Madrid System).
designations. You don’t need to leave the country anymore to make applications in other countries so you have big savings,” IPOPHL Director General Ricardo R. Blancaflor said.
Marks registered under the Madrid System are recognized across 92 countries which are members of the system either through the Madrid Agreement or Madrid Protocol.
The IPOPHL is pushing for local businesses to register for marks under the Madrid System, while also hoping that international brands would be encouraged by the country’s membership and do business here.
This makes it easier for businesses to register for international trademarks as it minimizes the need to make separate applications to individual countries.
The Philippines became party to the Madrid Protocol on July 25, 2012.
The Government has also been upping efforts to boost the protection of intellectual property rights (IPR) domestically. (TPS 21/4)
“This time, you just have one-time fee of CHF 630 and you have 91
3. DTI-4A enhances mediation and arbitration process
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onsumer arbitration, adjudication, and mediation officers of the Department of Trade and Industry (DTI) in Region 4-A underwent capacity building seminars conducted by the Department’s Office of Legal Affairs (OLA) in the regional office in Calamba, Laguna.
exceed 30 working days, with 10 working days from filing of the complaint allowed for mediation and adjudication to take place in the remaining 20 working days.
The seminar aimed to upgrade the mediation and arbitration skills and systematic processes of attending to consumer complaints, as well as discuss DTI’s Department Administrative Order No. 13-02 Series of 2013 (DAO 13-02: 2013).
Complaints not resolved through mediation are elevated for decision in the adjudication process.
The mediation process focuses on steps to settle the grievance without discourse on the legal merits.
DAO 13-02: 2013 amends some provisions of DAO 5: 2007 and DAO 7: 2006, making consumers’ access to redress for complaints and grievances easier and uncomplicated.
For the benefit of consumers who may not be knowledgeable on the laws, a liberal interpretation of the rules is applied to foster “just, speedy and inexpensive resolution of cases,” where ‘speedy’ pertains to absence of unnecessary delays and ‘inexpensive’ meaning the simple condition of submitting a position paper.
One of the significant clauses in DAO 13-2: 2013 states that mediation and adjudication period shall not
DTI also stressed that acceptable complaints only relate to defective products and services and not to
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instances where a consumer had a change of mind regarding their purchase, such as in preference of another color, model, or size. Titles of DAOs amended by DAO 13-02: 2013:
FEATURE DTI to showcase 2 editions of Sikat Pinoy Food Fair
DAO 5: 2007—Rules on Mediation in the Resolution of Inquiries, Complaints and/or Cases Filed with the Department of Trade and Industry (DTI) for Violations of the Consumer
DAO 7: 2006—Instituting the Simplified and Uniform Rules of Procedure for Administrative Cases Filed with the Department of Trade and Industry (DTI) for Violations of the Consumer Act of the Philippines and Other Trade and Industry Laws
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National Food Fair allows us to focus on the sector where we have a competitive advantage,” Domingo added.
he Department of Trade and Industry-Bureau of Domestic Trade (DTI-BDT) is set to organize two editions of Sikat Pinoy National Food Fair. The first edition was held last 26-30 March 2014. The second edition will be held on 3-7 December 2014. The fair is seen to have a big potential for generating employment and developing various backward and forward connections in the food sector. “Trade fairs have been and by far DTI’s most effective promotions strategy especially for food products. It must be noted that 50% of MSMEs belong to the food and beverage sector,” DTI Secretary Gregory L. Domingo said. “In addition, the food sector has tremendous potential to generate employment. So the DTI Sikat Pinoy
ASEAN Watch 1. DTI to review Asian neighbors’ tax regimes
Act of the Philippines and Other Trade and Industry Laws Supplementing Department Administrative Order No. 07, Series of 2006
DTI-BDT worked with DTI Regional and Provincial Offices and the Bureau of Fisheries and Aquatic Resources (BFAR) for last March’s food fair. The first edition showcased three pavilions, namely pili nuts, seafood, and coffee. BDT Director Rhodora M. Leaño said the total number of exhibitors exceeded their target, from 220 to a number close to 240 exhibitors. With its two editions this year, DTI aims to feature more of the best of the Philippines’ food products and provide more business and employment opportunities to micro, small, and medium enterprises (MSMEs).
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Community (AEC) Forum’s press conference, the DTI is undertaking a comparison of tax regimes in the region as well as those in East Asia.
DTI Secretary Gregory L. Domingo said in the Association of Southeast Asian Nations Economic
Doming said DTI Industry Development and Trade Policy Group (IDTPG) Undersecretary Adrian Cristobal Jr. has done preliminary tax regime review so they just have to continue it and determine
he Department of Trade and Industry (DTI) is reviewing tax regimes in Southeast Asia and East Asia to determine whether changes to the Philippines’ tax system have to be made to make the country more competitive.
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what we will propose, if any changes would be needed. The review is being undertaken as part of preparations for the AEC as the government wants to see the country’s position in terms of taxation. “What we want to do is just a comparison of tax regimes of our neighbors because obviously taxation is a very important component of investment decision and we’ve gotten some feedback from some large companies that tax rates here are quite high,” Domingo said. (TPS 12/4)
2. ASEAN integration good for telco industry
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he coming integration of Association of Southeast Asian Nations’ (ASEAN) 10-member countries for a common market and production base is good for the country’s telecommunication industry, GlobeTelecommunication President Ernest Cu said. “We can compete because we are much better and the ASEAN integration will help us open new markets for exports of our products perfected in our country,” Cu said. The telecommunication industry in the Philippines has come a long way and Globe has implemented positive net transformation initiatives in 2013 to lead and become an industry leader not only in the country but also in the whole ASEAN, he said.
STATWATCH USD 82B PHL’s exports target for 2014
USD 75.5B PHL’s total exports covering merchandise goods and services in 2013
USD 15.5B PHL’s revenue generated from the IT-BPO
industry, or a growth of 16% over the 2013 revenue,
employing 900,000 Filipinos. For 2016, the Information Technology and Business Processing Association of the Philippines (IBPAP) aims to produce USD
25B in revenues and 1.3M jobs. USD 4.65B Value
of Philippine exports in February 2014, or a growth of 24.4% over the USD 3.74B recorded in the same period last year
USD 1.88B Shipments of electronic products, including semiconductors, accounting for 40.4% of total exports in February 2014
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(A synopsis of selected book acquisitions at the DTI-TIIC library)
Title : Doing Business 2014: Understanding Regulations for Small and Medium Size Enterprises Publisher : World Bank Call Number : 00 000/03.09.03/WB/ 2013 This publication presents quantitative indicators on 11 areas of business regulations for 189 economies that covers: starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting investors, paying taxes, trading across borders, enforcing contracts, resolving insolvency, and employing workers. It aims to help mobilize policy makers to reduce the cost and complexity of government procedures and to improve the quality of institutions, so that entrepreneurs may have a great chance to grow their businesses and produce jobs, and workers are more likely to enjoy the benefits of these regulations such as social protections and safety. 278p.
Legend: MAB MST PDI TMT TPS
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Manila Bulletin Manila Standard Philippine Daily Inquirer The Manila Times The Philippine Star
Title : The Little Big Things: 163 Ways to Pursue Excellence
Author : Tom Peters Call Number : 05/PET/2010 It is a book of tips, notions, suggestions, and actionable ideas that businesses should learn/review and get “back to the basics” of running a successful enterprise. The author provides essential wisdom for everyone – from the freelance to the small business owner to the head of a major corporation – 163 ways to excel at the “people side of business” by pursuing excellence at every level. 538p.
Philippine Postal Permit No. PM-04-08
What’s New?
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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/Resty P. Par Writers/Jam H. Raposon, 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