Dataline 22 (2013) by Department of Trade and Industry

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November 04, 2013 1

November 04, 2013 Vol. 18, No. 22

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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 PHL business confidence rises Inside DTI 1. DTI to implement Office 365, holds briefing for employees 2. IPOPHL gets enforcement functions Good News, Philippines! 1. Outsourcing revenues seen to reach USD 16B 2. Exports up 20% in August 3. World Bank upgrades PHL growth forecast MSME News 1. PHL to boost MSMEs for integration 2. USAID project to ease SME loans 3. AFFI promotes local franchises 4. Coco coir SSF launched in Baybay City 5. DTI provides SSFs in Abra

Business Update 1. DTI puts up biz incubation facility in Laguna 2. DTI, DILG team up to boost BPLS reform projects 3. DTI investigates increasing newsprint imports 4. Mindanao to produce additional 800MW power supply by 2017 Consumer News 1. DTI leads Standards Week celebration 2. Confiscated counterfeit goods almost doubled Features DTI, PHILEXPORT target P35M-P40M sales in Likha trade fair ASEAN Watch 1. DTI, DFA lead PHL delegation to APEC meeting 2. PHL offers lowest rental rates in Asia Statwatch What’s New?

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Focus PHL business confidence rises

Vol. 18, No. 22 2

usiness confidence in the Philippines has improved as factors such as talent retention and return on investment (ROI) have improved, bucking a worldwide trend among emerging economies, solutions provider Regus reported. Regus’ latest Business Confidence Index (BCI) survey showed that confidence levels have risen five points to 109 in advanced economies while a nine-point drop to 117 was observed in emerging countries. “In the Philippines, business confidence has increased from 147 points in April 2013 to 154, well above the global average of 113 points,” Regus said. Firms reporting revenue growth in the country have risen from 63% to 74% and those saying “stayed steady growing” from 59% to 72%.

and advertising (54%), staff retention (49%), and cheaper advertising (26%) also showed improvements. PHL Business Confidence Factors Regus’ Business Confidence Index (BCI) Factors Cost-effective services providers ROI on marketing and advertising Staff retention Cheaper advertising

% of Respondent 58 54 49 26

“The report also indicated that Filipino businesses will focus on finding cost-effective services providers over the next 12 months to optimize business processes and gain maximum advantage from existing assets without compromising on expansion plans,” the solutions provider said. The survey was administered to over 20,000 senior executives across 95 countries.(BWD 10/10)

Cost-effective services providers (58%), ROI on marketing

Inside DTI 1. DTI to implement Office 365, holds briefing for employees

he Management Information Service (MIS) in cooperation with Microsoft Philippines Inc. (MS) organized a briefing on Office 365, a cloud-based Office suite on October 18, 2013 at the MS office in Makati City. Attended by mostly information and communications technology (ICT) representatives from various units of the Department of Trade and Industry (DTI), the briefing was conducted by First Data Corporation (FDC) Project Manager Shermaniño L. Antonio. Office 365 offers various functionalities and features such as e-mail, collaboration, unified communication, and social networking, all working seamlessly together.

Among other features, the suite allots 50 gigabytes (GB) email storage capacity for every user, with huge-sized files stored in the cloud, thereby saving on and maximizing the allotted GB. The DTI will be the first government agency in the Philippines to use and experience Office 365, Antonio said. MIS ICT Policy Formulation and Applications Development Team Chief Alfredo M. Torres said the target launch is on November 25, 2013. It will also be showcased during the DTI-Wide ICT Convention scheduled on December 05-06, 2013.

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2. IPOPHIL gets enforcement functions

November 04, 2013 3

he Intellectual Property Office of the Philippines (IPOPHL) can now exercise enforcement functions against intellectual property rights (IPR) violators with the amendments on the Intellectual Property Code. The IPOPHL has issued Office Order 13-170 which provides the rules and regulations in the exercise of its enforcement functions and visitorial power based on information, report, and complaints received by the agency. Under the Office Order, the IPOPHL will establish an IPR Enforcement Office. . The rules were issued following the amendments to the IP Code signed by President Benigno S. Aquino III in February. Previously, the only agencies which could arrest IPR violators and conduct raids were those part

Good News, Philippines! 1. Outsourcing revenues seen to reach USD 16B

he Information TechnologyBusiness Processing Association of the Philippines (IBPAP) expects to exceed its revenue and employment targets this year as more companies from overseas prefer the Philippines as the location for outsourcing operations. IBPAP expects revenues to reach USD 16B this year, 21% higher than the USD 13.2B last year, IBPAP President Jose Mari Mercado said. The projection, he said, is above its target of 19-% growth or revenues worth USD 15.7B. He said that the group also expects to go above the employment target

The IPR Enforcement Office functions • Receive complaints or reports relating to IPR violations

• Evaluate complaints • Coordinate with rights holders • Formulate policies and programs to ensure IPR enforcement • Provide assistance in enforcement of orders, writs, and processes issued by the Bureau of Legal Affairs and the Office of the Director General

of the National Committee on IPR such as the Philippine National Police (PNP), Bureau of Customs (BOC), National Bureau of Investigation (NBI), and Optical Media Board (OMB). Latest data from the IPOPHL showed that as of end-September, the value of counterfeit and pirated goods seized by the government amounted to P6.13B, up from P4.14B in the same period last year. of 925,000, up 19% from last year’s 777,000, with the total information technology-business process management (IT-BPM) workforce seen to reach 960,000 by the end of the year. The group expects to exceed its targets as the country remains to be the preferred destination for voice and non-voice services. The country is now well-positioned to serve the requirements of companies across different geographies, IBPAP Chairman Danilo Sebastian said. (TPS 10/08)

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2. Exports up 20% in August

Vol. 18, No. 22 4

erchandise exports surged by 20.2% in August, the fastest growth in 11 months, with a wide range of commodity groups contributing to the growth. Data released by the National Statistics Office (NSO) showed that the value of exports in August went up to USD 4.58B from USD 3.81B recorded in the same month last year. Notably, the National Economic and Development Authority (NEDA) said the Philippines was the strongest performer among its East and Southeast Asian neighbors in terms of August exports. “We are now reaping the benefits of our efforts to diversify the country’s exports base as seen

3. World Bank upgrades PHL growth forecast

he Philippines will likely sustain a growth of near 7% in the medium term on the back of increased private and public spending, the latest East Asia and the Pacific (EAP) Economic Update released by the World Bank (WB) showed. WB upgraded its gross domestic product (GDP) growth forecast for the Philippines to 7% in 2013 and 6.7% in 2014. In its earlier EAP report released in May, the bank forecast only a growth of 6.2% for 2013 and 6.4% in 2014.

MSME News 1. PHL to boost MSMEs for integration

resident Benigno S. Aquino III said the Philippines will focus on micro, small, and medium enterprises (MSMEs) to support the Association of Southeast Asian Nations (ASEAN) economic integration by 2015. “The Philippines will continue to support the ASEAN-wide Self-Certification Scheme, which will help facilitate the participation of MSMEs in regional trade,” Aquino said.

in the increasing revenues from agro-based, forest, mineral, and petroleum products,” NEDA Deputy Director-General Rolando G. Tungpalan said. (MAL 10/10, TPS 10/06) Top 10 PHL exports to all countries (August 2013) Merchandise

Year-on-year growth in %

Petroleum products 115,374.80 Other mineral products 455.00 Bananas (fresh) 266.20 Chemicals 121.20 Woodcrafts and furniture 68.70 Other manufactures 65.60 Ignition wiring set 12.20 and other wiring sets used in vehicles, aircrafts, and ships Machinery and transport (58.0) equipment Metal components (0.50) Electronic products (0.40)

The Philippines was one of only three developing East Asian countries that received growth-forecast upgrades from the WB for 2013 and 2014. The other two were Myanmar and Papua New Guinea. “The Philippines is bucking the trend in the rest of the region. There are many points in the report where you actually see the Philippines look a lot better than other countries in the region,” WB Philippines Lead Economist Rogier van den Brink said. (BMI, TPS 10/07)

He said the country developed the Philippine Tariff Finder to facilitate free flow of goods in the region. “We believe that this is in the interest of consumers in all of our countries, which is why this has been pursued. It will enhance the competitiveness and the efficiency of our businesses,” Presidential Communications Development and Strategic Planning Office (PCDSPO) Secretary Ramon A. Carandang said. (BWD 10/09)

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2. USAID project to ease SME loans

November 04, 2013 5

he United States Agency for International Development (USAID) and the Philippine government launched a new Advancing Philippine Competitiveness (COMPETE) project that includes a component to help increase small and medium enterprise (SME) access to loans. “We try to reduce if not completely tear down that Berlin Wall that separates banks from SMEs so that liquidity can flow to the SMEs,” Component 3 Team Leader Mario Lamberte said.

3. AFFI promotes local franchisees

he Association of Filipino Franchisers Inc. (AFFI) is calling on entrepreneurs to invest in local franchises to help the country’s micro, small and medium enterprise (MSME) sector grow. “We encourage Filipino businessmen to invest in homegrown franchises which have seen continuous demand abroad,” AFFI President Armando Bartolome said.

4. Coco coir SSF launched in Baybay City

he Department of Trade and Industry (DTI) turned over coco coir shared service facility (SSF) to the Maybog Farmers Association (MAFA) in Baybay City. MAFA was chosen as the program’s recipient to help increase the production capacity of this community-based enterprise through the provision of additional equipment, DTI-8 Regional Director Cynthia Nierras said. Six manual wooden handloom and 24 manual bicycle-type twining machines would directly benefit 43 coco coir twiners and weavers in Barangays Maybog and Caridad. Coco coir is a fiber extracted from coconut husks and used

The project addresses credit constraints for SMEs, particularly the problem of inadequate collateral and developing a winning business proposal that is acceptable to loan application, Lamberte said. (TPS 09/30) COMPETE project beneficiaries (Company) • • • • •

Construction Energy Healthcare Manufacturing Post-harvest agricultural processing and agribusiness • Tourism sectors

At least 12 of AFFI’s 112 members have already expanded overseas with carts and stalls now operating in Indonesia, Australia, Japan, South Africa, and the United States (U.S.). MSMEs account for over 90% of the country’s total registered businesses and AFFI’s members currently have a total of 16,093 stores. (TPS 10/06)

in making brushes, doormats, fertilizers, floor mats, mattresses, and nets.

PHL’s top coco coir export markets Country

Product

Malaysia and United States (U.S.)

Carpets

China, Europe, Coco twines India, Indonesia, or cordage United Arab Emirates (UAE), the U.S., and Viet Nam China, Japan, Singapore, and South Korea

Peat and dust

China, Japan, Taiwan, and the U.S.

Raw or baled fiber

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5. DTI provides SSFs in Abra

Vol. 18, No. 22 6

he Department of Trade and Industry (DTI) turned over five more shared service facilities (SSFs) to micro, small, and medium enterprises (MSMEs) in Bangued, Abra to increase their production capacities, improve product quality, and reduce production costs. Recipient

1. DTI puts up biz incubation facility in Laguna

• Abra State Institute • • •

Packaging service and toll packing Chichacorn processing Chichacorn processing

of Science and Technology (ASIST)-Lagangilang Campus Adtempco Gabriela Women’s Association Capit Caibigan Chichacorn Producers of Langiden KAPPIA Network Inc.

he government is putting up a technology business incubation (TBI) facility to provide business development services for technology start-ups in Sta. Rosa, Laguna to encourage more investments in the information and communications technology (ICT) sector there.

“Sta. Rosa has succeeded in hosting ICT-enabled businesses and itself a business model of the industry, a strength and reason why we focused on it,” Department of Trade and Industry (DTI)-CALABARZON Regional Director Marilou Quinco-Toledo said.

2. DTI, DILG team up to boost BPLS reform projects

Facilities Tropical fruit processing

•

Business Update

DTI-Abra Senior Trade and Industry Development Specialist Henry Reyes said the total project cost for the SSFs is P1.59M. The project will benefit about 10,309 members of the recipient-organizations.

he Departments of Trade and Industry (DTI) and the the Interior and Local Government (DILG) are initiating reforms on the processing of business permits in an effort to provide efficient delivery of services. Under the DTI-DILG Joint Department Administrative Order 10-07, the Business Permit and Licensing System (BPLS) oversight committee will be established to oversee the implementation of the BPLS streamlining reforms particularly on its services standards.

Muscovado processing

The plan to put up a TBI facility was made through DTI’s National Industry Cluster Capacity Enhancement Project (NICCEP) in collaboration with the Japan International Cooperation Agency (JICA). The Department of Science and Technology-Information and Communications Technology Office (DOST-ICTO) will undertake start-up activities at the Sta. Rosa TBI with the Philippine Software Industry Association (PSIA).

The committee will address the processes of renewing business permits, which burden and dissatisfy many business owners in local government units (LGUs). It will also set up a monitoring system for tracking the progress of the BPLS reformation in many target LGUs. DTI and DILG representatives will be committee co-chairs, and they will be joined by concerned government agencies such as the National Computer Center (NCC), private business groups, and development partners.

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3. DTI investigates increasing newsprint imports

November 04, 2013 7

he Department of Trade and Industry (DTI) launched a preliminary investigation regarding the increasing volume of newsprint imports. The investigation was prompted by the Trust International Paper Corporation’s (TIPCO) petition for safeguard measures. TIPCO’s documents showed the increasing number of newsprint imports that is slowing down the local newsprint industry. “The investigation will make a preliminary determination

4. Mindanao to produce additional 800MW power supply by 2017

he Department of Energy (DOE) sees ample energy supply in Mindanao by 2015 with additional power capacity of at least 800 megawatts (MW) to be available by 2017. Plants for maintenance from July-December • 210MW STEAG coal-powered plant • 160MW Pulangi IV hydropowerplant • 25-50MW Agus 6 hydropowerplant

Consumer News 1. DTI leads Standards Week Celebration

he Department of Trade and Industry (DTI) marked the 39th annual observance of the National Standards Week (NSW) with the theme “International standards ensure positive change.” The DTI conducted a number of activities to inform consumers on the importance of standardization and safety. The Diskwento Caravan was held in the premises of the DTI Main Bldg. in Makati City last October 8 to 9 featuring Philippine Standard (PS) and Import Commodity Clearance (ICC) certified appliances at discounted prices.

whether the increasing volume of imported newsprint is causing serious injury to the local producer of newsprint,” DTI said. In 2011, newsprint imports posted at 26,356 metric tons (MT) from 2007’s 2,956MT, a 792-% increase. The year 2012 registered the highest newsprint imports with 31,462MT. Majority of the imported material were reportedly sourced from the United Kingdom (UK), People’s Republic of China, and South Korea.

The power crisis in Mindanao is expected to be eased by power plants being developed in Mindanao by several companies. (TPS 10/07)

Some companies developing power plants in Mindanao • Aboitiz Group – 300MW • Alcantara Group – 200MW • FDC Utilities Inc. – 270MW • San Miguel Global Holdings Corp. – 600MW

Five manufacturers and suppliers of local and imported appliances and producers of basic commodities participated in the event. The Bureau of Product Standards (BPS) also conducted a two-day lecture seminar on Standards and Conformance Cooperation in the Association of Southeast Asian Nations (ASEAN), in coordination with the Bureau of Export Trade Promotion (BETP). The seminar informed participants of the ASEAN Economic Community Integration on rubber and electrical and electronics products standards.

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Vol. 18, No. 22 8

Meanwhile, the public was also warned against using Christmas lights that are three years or older and those with no standards clearance. It was found that materials that make up Christmas lights, particularly its insulation that is made from plastic or polyvinyl chloride (PVC), degrade and can only withstand electricity up to three years.

2. Confiscated counterfeit goods almost doubled

he value of fake goods seized by the National Committee on Intellectual Property Rights (NCIPR) from January to September this year rose by 48% to P6.13B from P4.14B during the same period in 2012. Intellectual Property Office of the Philippines (IPOPHL) Director General Ricardo R. Blancaflor said this surge signifies

Importers and traders are called to pull out and avoid marketing Christmas lights with Import Commodity Clearance (ICC) and Philippine Standard (PS) stickers issued from 2010 or prior. The Department will conduct market visits to guarantee that old Christmas lights are not being sold. (PDI 10/09)

increased cooperation of brand owners in intellectual property right enforcement. “The government still has to strive harder to cultivate respect for intellectual property in every Filipino so that counterfeiting and piracy will be totally eradicated,” Blancaflor said. (PDI 10/07)

Value of confiscated items Gov’t Agency Bureau of Customs (BOC) National Bureau of Investigation (NBI) Optical Media Board (OMB) Philippine National Police (PNP)

Features DTI, PHILEXPORT target P35M –P40M sales in Likha trade fair

he Department of Trade and Industry (DTI) and the Philippine Exporters Confederation, Inc. (PHILEXPORT) targeted to hit P35M-P40M in sales in the 2013 Likha Ng Central Luzon (LCL) Trade Fair held recently at SM Megatrade Hall, Megamall in Mandaluyong City. Last year’s sales were recorded at P33M. More than 150 MSMEs from Central Luzon particularly from the provinces of Aurora, Bataan, Bulacan, Nueva

2013 (PhP) 3.18B 2.29B 638.00M 21.16M

2012 (PhP) 1.10B 1.93B 850.67M 254.94M

% Change 189.00 18.80 -25.00 -91.70

Ecija, Pampanga, Tarlac, and Zambales joined the fair. Processed meat and fish, garments, dairy, furniture and home furnishing, ceramics, jewelry, fashion accessories, bags, footwear, gifts and holiday decors, and other food and non-food items were the featured products in the fair. Newly industrialized bamboo products, indigenous items, and environment-friendly materials were also highlighted in the said event.

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November 04, 2013 9

The four-day fair was an opportunity for MSMEs to promote their products, create networks within the industry, and get clients and partners for their businesses.

ASEAN Watch 1. DTI, DFA lead PHL delegation to APEC meeting

eaders of the 21-member economies of the Asia Pacific Economic Council (APEC) attended the recent APEC Ministers Meeting in Bali, Indonesia that focused on the theme “Resilient Asia Pacific: Engine of Global Growth.” APEC ministers addressed concrete measures towards Bogor Goals particularly in reducing the development gap among and with the economies. Department of Trade and Industry (DTI) Undersecretary for Industry Development and Trade Policy Group (IDTPG) Adrian S. Cristobal, Jr. and Department of Foreign Affairs Secretary Albert F. Del Rosario led the Philippine delegation. “The Philippines has noted that while individual and collective efforts toward achieving the Bogor Goals have led to substantial reductions in barriers to trade and investment, sustained economic growth and improvement in the welfare of all people in our region still remain a challenge,” Cristobal said. “The Philippine agenda in the APEC has been to consistently communicate the complementarities of the APEC role in supporting the participation of SMEs in global trade,” he said.

The annual event was organized by DTI-Region 3, PHILEXPORT-3, Regional Development Council (RDC), and Central Luzon Growth Corridor Foundation, Inc.

STATWATCH USD 16B Revenue target

by the information technology-business process management (IT-BPM) industry for 2013, 21% higher than the USD 13.2B in 2012

P6.13B The value of fake goods

seized by the National Committee on Intellectual Property Rights (NCIPR) from January to September 2013, up by 48% from P4.14B during the same period last year

USD 4.58B

Exports value in

August 2013 from USD 3.81B recorded in the same month in 2012

925,000 Job employment target

by IT-BPM industry for 2013, up 19% from last year’s 777,000

154 Philippines’ business confidence index points, well above the global average of 113 points, based on the latest Business Confidence Index (BCI) survey by Regus 20.2%

Growth of merchandise exports in August 2013, fastest growth in 11 months

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2. PHL offers lowest rental rates in Asia

Vol. 18, No. 22 10

he Philippines still offers the lowest rental rates in Asia despite demands for high office spaces, according to Property Services firm CB Richard Ellis (CBRE) Philippines. As of 2013’s second quarter, the Makati Central Business District’s (CBD) office space rental rate is USD 26 per sq. ft. per annum. The business process outsourcing (BPO) sector has the largest demand for office spaces. The Philippines is still one of the most profitable and attractive districts for BPOs in Asia, CBRE Philippines Chairman and Founder Rick Santos said.

Business Districts Hong Kong Core Central Beijing CBD Tokyo New Delhi CBD Shanghai-Puxi Singapore Mumbai-Nariman Point Seoul CBD Guangzhou Jakarta Taipei Ho Chi Minh Hanoi Kuala Lumpur New Delhi-Gurgaon Bangalore Bangkok Philippines

USD per sq. ft. per annum rate 207 182 134 122 101 99 74 68 65 65 60 49 47 46 41 36 32 26

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(A synopsis of selected book acquisitions at the DTI-TIIC library)

Editor : Lester, David/Bishop, Beth Call Number : 06.07.10/LES/2010

Author: Barrow, Colin Call Number : 06.08/BAR/2011

Contains profiles of 25 business founders and their inspirational stories and sound business advice, and gives even the most cautious entrepreneur the confidence to start their business in tough times.

This material is an invaluable practical guide for aspiring entrepreneurs. It identifies business opportunities and gives advice on how to set up, run, control, and manage its growth.

It shows how these businesses started during a tough economic climate and tells the first step they took, the unique challenges they faced and how they grew and became established. 269p.

Also includes researching the market; business ownership and title issues; raising the money and managing finances; building and operating a website; writing up a business plan; preparing basic accounts; and bringing a product to market and starting up overseas. 305p.

Legend: BMI BWD MAL MST PDI TPS

Business Mirror Business World Malaya Manila Times Philippine Daily Inquirer The Philippine Star

Title : Starting a business from home

Title : How they started in tough times

Entered as Third-Class Mail at the Makati Central Post Office under Permit No. PM-04-08 valid until 31 December 2013

Philippine Postal Permit No. PM-04-08

What’s New?

November 04, 2013 11

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: Kit S. Andaya/Ren C. Neneria Circulation: Myrna V. De Los ReyesTo subscribe, email: publications@dti.gov.ph