dataline
December 16, 2013 1
December 16, 2013 Vol. 18, No. 25
dataline
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 IPP 2013 approved Inside DTI Statement of Secretary of Trade and Industry Gregory L. Domingo on Diskwento Caravan Good News, Philippines! 1. Domestic consumption seen to remain strong in Q4 2. PHL leads in office space growth MSME News DTI, Nestlé to set up coffee buying stations Business Update 1. PEZA investments up 38.5% to P150.91B 2. Investors remain bullish on real estate sector
Consumer News 1. DTI holds Diskwento Caravan in typhoon-hit areas 2. DTI warns sanction for violation of price freeze 3. DTI, Microsoft team up for price monitoring scheme 4. DTI monitors supply, prices of construction materials 5. FDA finds NPCs in NCR, Cebu processed food 6. DTI, industry groups sign MOU to uphold consumer rights
Features DTI launches “Oplan Open Store” ASEAN Watch 1. Asian economies’ outlook stable 2. Asia’s export earnings foreseen to recover Statwatch What’s New?
dataline
Focus IPP 2013 approved
Vol. 18, No. 25 2
P
resident Benigno S. Aquino III has signed the Investment Priorities Plan (IPP) for 2013 which identifies the priority activities for investments that can qualify for government incentives.
as those identified as priorities by the Regional Board of Investments of the Autonomous Region in Muslim Mindanao (RBOI-ARMM). RBOI-ARMM priority activities
2013 IPP preferred activities
· · · · · · · · · · · ·
Agriculture or agribusiness and fishery Creative industries or knowledge-based services Disaster prevention, mitigation and recovery projects Green projects Hospital or medical services Infrastructure Iron and steel Mass housing Motor vehicles Research and development Shipbuilding Strategic projects
The 2013 IPP also has a mandatory list covering activities which require their inclusion in the IPP as provided under existing laws.
2013 IPP mandatory list
· · · · · · · · ·
Exploration, mining, quarrying, and processing of minerals Ecological solid waste management Clean water projects Publication or printing of books or textbooks Refining, storage, marketing and distribution of petroleum products Rehabilitation, self-development and self-reliance of persons with disability Renewable energy Tree plantation Tourism
Aside from the lists of preferred activities and mandatory activities, the IPP covers export activities as well
· · · · · · · · · · · ·
Agriculture, agribusiness or aquaculture fishery Basic industries BIMP-EAGA trade and investment enterprises Consumer manufactures Engineering industries Export Halal industry Health and education services and facilities Industrial service facilities Infrastructure and services Logistics Tourism
Memorandum Order No. 59, which approves the 2013 IPP, states that “the extent of entitlement to incentives shall be based on the project’s net value added, job generation, multiplier effort and measured capacity.” Department of Trade and Industry (DTI) Secretary Gregory L. Domingo said the implementing rules and regulations for the 2013 IPP would be issued this month. The IPP is the country’s blueprint for investment promotions to develop the countryside and generate jobs. It identifies the priority economic activities and the sectors that are eligible for incentives. The Board of Investments (BOI) leads the interagency effort to annually craft the IPP, which is meant to attract more investments and mobilize private capital in key areas of the economy.
dataline
December 16, 2013 3
Inside DTI Statement of Secretary of Trade and Industry Gregory L. Domingo on Diskwento Caravan
On DTI’s Diskwento Caravan in Yolanda-affected areas
T
[November 26, 2013]
he Department of Trade and Industry (DTI) has been conducting Diskwento Caravans (Discount Caravans) for many years to sell goods to consumers at discounted prices. It is a public service conducted by DTI in partnership with big manufacturer and/or distributors. It is also an act of public service by the manufacturers and distributors as most of them do not make money on their Diskwento Caravan activities. In calamity areas, the value of Diskwento Caravans is in providing the availability of nonrelief item at a discounted price. In the last 10 days in Samar/Leyte, we have provided many truckloads of bread, canned milk, assorted other canned goods, other types of beverage, sanitary napkins/panty liners and many other products that are otherwise unavailable in the area. DTI’s 2nd Diskwento Caravan in Tacloban tomorrow will also include construction materials such as GI sheets, nails, etc. and products such as batteries, flashlights and other necessities. DTI has a very meager budget and gets zero donations. The Diskwento Caravans especially in areas in Leyte/Samar have been conducted at great sacrifice by our employees around the region and by the employees of our partner
companies as they effectively take 30 hour shifts from the time they leave Cebu port on a RORO to Leyte/Samar to the time they get back to Cebu after holding the Diskwento Caravan without the benefit of a hotel room or assured toilet facilities. It is their desire to help that keeps them going. I only hope they don’t read the negative comments regarding the Diskwento Caravan on iReport as it will certainly break their hearts. Finally, while a number of nations and organizations have pledged their assistance amounting to over USD 360M to the Philippines, a major part of that amount is given directly to foreign and local aid agencies, contrary to the impression that government is given all of that aid money. It is precisely in the spirit of transparency that our government has put up the Foreign Aid Transparency Hub or the FAiTH website (www.faith.gov.ph) where one can access the respective pledges of assistance of nations and organizations, and where the pledge is addressed to, either to the Philippine government or private organizations. I encourage your readers to visit the FAiTH website. Thank you.
dataline
Good News, Philippines! 1. Domestic consumption seen to remain strong in Q4
2. PHL leads in office space growth
Vol. 18, No. 25 4
D
omestic consumption, which primarily drives the country’s economic growth, is expected to remain robust in the last quarter this year, the Bangko Sentral ng Pilipinas (BSP) said.
output, still growing robustly,” the BSP said.
“Output expansion is expected to be sustained over the quarter with higher-frequency indicators of demand, including vehicle sales, energy sales, and manufacturing
The BSP also said its consumer and business confidence surveys both showed bullishness for the fourth quarter. (TPS 11/22)
T
he Philippines outpaced the rest of the Asia-Pacific region in terms of the net absorption of office space in the first nine months of the year, which was proof of the country’s robust economic condition and improved business sentiments, according to global real estate advisor Cushman & Wakefield.
“Purchases of the retail/wholesale sector were in expansion mode in preparation for the Christmas season,” the report said.
Absorption rate of office space by location Location Taguig City Makati City Ortigas Muntinlupa
Size in sqm
% share
285,024 139,103 48,818 9,178
59 29 10 2
The absorption of office space by Metro Manila reached 482,126 square meters (sqm), surpassing Mumbai, which came second at 314,528 sqm.
Since the vacancy rate has declined rapidly to an average of 4.29%, Curran noted that this could put upward pressure on rental rates or office leases.
“The performance of the office sector in Manila compared with other cities in the region is a testament to how strong the market is today,” Cushman & Wakefield Philippines General Manager Joe Curran said.
“Completions are expected to be thin in the first half of 2014 as developers are expected to complete projects by end 2014, 2015, and 2016. This is expected to put upward pressure on prices and vacancy,” Curran said.
“Metro Manila is witnessing a positive momentum due to strengthening economic condition and improved business sentiments, relatively insulated from the global slowdown. Stable growth in the business process outsourcing (BPO) sector continues to fuel office expansions in Metro Manila,” Curran further said.
“Overall, rents will experience upward pressure, but a slowing growth rate as demand stabilizes,” he said.
New supply of office space, meanwhile, is estimated to reach 514,958 sqm by the end of 2013.
Incoming office supply for the fourth quarter of 2013 to 2015 is estimated at 1.2M sqm in Metro Manila with Bonifacio Global City, accounting for 42% of new supply. (PDI 11/22)
dataline
3. PHL exports up 4.9% in September
December 16, 2013 5
T
he country’s exports last September grew by 4.9% to USD 5B from the same period last year, according to the Merchandise Export data from the National Statistics Office (NSO). “The positive growth was mainly brought by the increase of eight out of the top 10 commodities for the month,” the NSO said. “On a monthly basis, product exports increased by 10.1% in September
4. PHL manufacturing seen to stay robust
T
he country’s manufacturing output likely expanded at a robust pace in September and is poised to maintain the favorable performance shown so far this year through 2014 according to Moody’s Analytics.
from USD 4.8B posted in August,” the NSO said. (TMT 11/12) Eight improving commodity sectors
· · · · · · · ·
faster than the 5.6% registered in the same period last year. In August, volume of production by the country’s manufacturers grew by 18.3% year on year. (PDI 11/11) Manufacturing growth drivers for Sept 2013
Volume of production by manufacturers may have grown 16% in September from a year ago on the back of strong domestic demand, Moody’s Analytics said.
· · · · · · · · · ·
Should the forecast be correct, the average rise in manufacturing output in terms of volume would settle at 11.4% in the first nine months,
MSME News DTI, Nestlé to set up coffee buying stations
T
he Department of Trade and Industry (DTI) and Nestlé Philippines are looking to put up more ‘satellite coffee buying stations’ that will directly buy the produce from the Filipino farmers. The company planned to put up these stations in communities that can produce 350 to 400 metric tons (MT) of coffee yearly, Nestlé Philippines Corporate Affairs Vice President (VP) Ruth P. Novales said.
Other mineral products Cathodes and sections of cathodes of refined copper Other manufactures such as button, pins and the likes Ignition wiring set and other wiring sets used in vehicles, aircrafts and ships Metal components Electronic products Articles of apparel and clothing accessories Chemicals
Basic metals Beverages Chemicals Furniture and fixtures Leather Nonmetallic minerals Plastic products Rubber Tobacco Wood
Nestlé is developing one in Quirino province aside from nine satellite stations. Existing Nestlé satellite coffee buying stations
· · · · · · · · ·
Cagayan de Oro City, Misamis Oriental Dumaguete City, Negros Oriental General Santos City, South Cotabato Iloilo City, Iloilo Lipa City, Batangas Silang, Cavite Tagbina, Surigao del Sur Tagum City, Davao del Norte Tuguegarao City, Cagayan Valley
dataline
Vol. 18, No. 25 6
The DTI is also looking at setting up stations in the Cordillera Administrative Region (CAR), particularly in Kalinga, Ifugao, and Abra, said DTI-CAR Regional Director Myrna P. Pablo.
Business Update 1. PEZA investments up 38.5% to P150.91B
T
he Philippine Economic Zone Authority (PEZA)-approved investments rose 38.5% to P150.91B in the January to October period compared to last year as locators spent for expansion and new players set-up operations in the country. The country is becoming a more attractive location for investments given its strong economic growth,
2. Investors remain bullish on real estate sector
T
he country’s sustained economic growth is expected to further buoy positive investor sentiment toward the real estate sector, full service real estate firm KMC MAG Group said. “The factors behind such growth are the active construction industry and the business process outsourcing (BPO) sector, as well as the high rate of overseas Filipino workers’ (OFWs) remittances,” KMC Managing Director Michael McCullough said. McCullough said credit-rating achievements have increased
Consumer News 1. DTI holds Diskwento Caravan in typhoon-hit areas
T
he Department of Trade and Industry (DTI) conducted Diskwento Caravans in Leyte and Samar in its effort to stabilize food supply and sell basic goods at discounted prices in the communities affected by Super Typhoon Yolanda. Cities visited by the Diskwento Caravan
· · ·
Baybay Calbayog Catbalogan
· · ·
Maasin Ormoc Tacloban
Pablo said that by the end of the year, the Philippines would have imported 40,000 MT of coffee to sustain local consumption. (PDI 11/13)
good governance efforts, and its available labor pool. PEZA Director General Lilia De Lima said 55% of the approved investments were funds poured in by existing locators to expand operations, while the rest came from new players. De Lima added that the investments are for manufacturing facilities. (TPS 11/16) investment interests in the Philippines, and a stable political climate under President Benigno S. Aquino III administration also contributed to growth. He also pointed out those key interest rates are low, offering good debt financing opportunities for real estate and increased commercial and residential real estate-related loans signal an active property sector. “We’ve seen continuously low vacancy rates, as there is strong take up within central business districts (CBDs),” he said. (MAT 11/20)
Companies participating in the Diskwento Caravan
· · · · · · · ·
Alturas Group of Companies Century Canning Corp. Dranix Gardenia Bakeries Philippines Inc. Nestlé Philippines Nutri-Asia San Miguel Pure Foods Co. Inc. Unilever
DTI-Southern Leyte Provincial Director Michael B. Nuñez said
dataline
December 16, 2013 7
people were grateful to have direct access to wholesalers and buy products at discounted prices.
particularly in Tacloban City, as residents also look for materials they can use to rebuild their houses.
In addition to basic goods, construction supplies were also sold
2. DTI warns sanction for violation of price freeze
T
he Department of Trade and Industry (DTI) has warned businessmen of sanctions if found violating the price freeze imposed by the government following the devastation by Super Typhoon Yolanda in Visayas and other parts of the country. DTI-Negros Oriental Provincial Chief Javier R. Fortunato Jr. said as part of the President Benigno S.
3. DTI, Microsoft team up for price monitoring scheme
4. DTI monitors supply, prices of construction materials
T
he Department of Trade and Industry (DTI) has partnered with Microsoft Philippines to develop the Online Price Monitoring Scheme (OPMS), an application which will make Department’s price monitoring of goods sold in the market easier.
Aquino III’s declaration of a state of national calamity last November 11, prices of basic goods in Region 7 are frozen at the prevailing prices prior to typhoon Yolanda. This is based on Section 6 of Republic Act 7581 or the Price Act. Retailers found selling at more than the listed prevailing prices shall be fined.
The OPMS improves the process of price monitoring. Instead of using the pen-to-paper method before the data input, it allows the DTI’s team to input the prices of goods directly to their tablets and send their reports online to the Price Monitoring Unit (PMU) in the Department’s office in Makati City.
“Our partnership with Microsoft enabled us to optimize technology as a tool in reinforcing DTI policies including price implementation in the market,” DTI Undersecretary for Management Services Group (MSG) Nora K. Terrado said.
“This represents our high regard for innovation as a prerequisite in building a healthy business ecosystem and in facilitating the general welfare of the consumers,” Terrado said.
N
up to the first quarter of 2014 as long as there is no increase in raw materials, labor, operating, and manufacturing costs.
ow that most people in communities affected by Super Typhoon Yolanda are gearing up to rebuild their houses, the Department of Trade and Industry (DTI) is closely monitoring the supply and prices of construction materials. DTI-Cebu Provincial Office Consumer Welfare and Business Regulation Division Chief Zaide C. Bation said 14 Cebu-based construction supplies manufacturers promised not to increase the prices
“The local manufacturers committed that they won’t increase their prices. Still, the DTI will go on field to check the prices and supplies of construction materials in hardware stores to verify if what they are saying is true,” Bation added.
dataline
5. FDA finds NPCs in NCR, Cebu processed food
Vol. 18, No. 25 8
S
ome samples of food products from the National Capital Region (NCR) and Cebu analyzed by the Food and Drug Administration (FDA) were tested positive for non-permissible colorants (NPCs) found to cause adverse effects such as cancer. Of the 62 samples collected, 35 were from NCR and 27 were from Cebu. One product found to contain NPCs is Kasubha, which is derived from safflower plants and often falsely marketed as saffron. The public is cautioned of toxic food products and illegal food establishments, and is highly advised to report suspected use of NPCs to the FDA.
6. DTI, industry groups sign MOU to uphold consumer rights
T
he Department of Trade and Industry (DTI) signed separate Memoranda of Understanding (MOU) with the Advertising Standards Council (ASC), Direct Selling Association of the Philippines (DSAP), and the Philippine Chamber of Food Manufacturers (Food Chamber) to ratify their collaborative framework to ensure the protection of consumer rights. Under the MOU, the ASC is to resolve disputes among its members and support the DTI in its mandate of guarding consumers against false and deceptive advertising. Partnership between DTI and DSAP is revived and strengthened in their MOU which obliges both parties to conduct anti-pyramiding
NPCs and properties/effects
· · · ·
Metanil Yellow—predisposes body to nervous toxicity Orange II—severe damage to red blood cells, bile duct, spleen, liver, kidney, and testes in rats and mice Sudan Dye—carcinogenic industrial dye used for shoe and floor polish, solvents, oils, waxes, and petrol Rhodamine B—carcinogenic in mammalian models Food products with NPCs
· · · · · · · · · · · · ·
Atsuete powder Cheese powder Chili powder Dried shrimp Fish cracker and snack foods Fish tapa Kasubha powder Paprika powder Red gulaman Seasoning mix Spices and blends Sugar coated fennel Tumeric powder
awareness campaign, study Direct Selling companies’ compensation plans, and address consumer concerns on pyramiding and chain distribution. The DTI MOU with the Food Chamber institutionalizes their coordination to guarantee availability and basic and prime commodities accessibility in times of calamity and other incidents that affect pricing and supply of goods. “The signing of these Memoranda of Understanding proves that the DTI gives much importance on involving the industry sector in safeguarding the interests of consumers,” Consumer Welfare and Business Regulation Group (CWBRG) Officer-in-Charge Atty. Victorio Mario A. Dimagiba said.
dataline
Features DTI launches “Oplan Open Store”
December 16, 2013 9
T
he Department of Trade and Industry (DTI) recently launched the “Oplan Open Store” website, www.openstores.yolanda.dti.gov.ph, to guide consumers in finding open business establishments in Visayas region’s typhoon-hit areas. “The Oplan Open Stores Website serves as a guide for the public, the media covering the area, and relief effort groups who are in need of supplies,” DTI Secretary Gregory L. Domingo said. The website is DTI’s initiative to speed up the communities’ recovery and rehabilitation. It also helps normalize the business operations in the typhoon-affected areas. Consumers can visit the website to check establishments that resumed operations where they can purchase basic necessities and prime commodities.
ASEAN Watch 1. Asian economies’ outlook stable
T
he Asian economies overall outlook credit rating is stable. Moody’s Investors Service reported that the Philippines and other Asia Pacific sovereigns, corporations, and financial institutions remain stable despite strengthening headwinds. “We believe the region can withstand increased headwinds that are likely in the next 12 months, including slower economic growth in China, the U.S. Federal Reserve scaling back its bond-buying program and the potential bursting of asset bubbles,” Moody’s said. The credit rating firm expects Asian economies to endure the instability brought by the United States (U.S.) Federal Reserve’s tapering of its stimulus program.
By clicking the province’ name in the map, the public can view the list of all open stores in the typhoon-struck areas. It also allows the public to send feedback to DTI on open stores that are not in the list. Among the open business establishments lists are hardware/ auto supplies, wet markets, gasoline stations, bakeries, rice stores, drug stores, supermarkets/groceries, water refilling stations, and automated teller machines (ATM). The DTI urges the public to regularly check the website for daily updates on the list of opened stores. Consumers may send their feedback on reopened business establishments to DTI by sending an email to openstores.yolanda@dti.gov.ph or by sending a message through the open stores website. The public may also call the DTI Hotline at (632) 751.3330 and 0917.8343330.
STATWATCH P150.91B Philippine Economic Zone Authority (PEZA)-approved investments in January-October 2013
USD 5B
Philippine exports last September 2013, up 10.1% from
USD 4.8B in August 2013 350MT-400MT Target volume of coffee to be produced from satellite coffee buying stations to be put by DTI and Nestlé
482,126 sqm
Absorption of office space in Metro Manila, surpassing Mumbai with 314,528 sqm. New supply of office space is estimated to reach 514,958 sqm by end-2013
18.3% Growth in volume of production by manufacturers in August 2013
dataline
2. Asia’s export earnings foreseen to recover
Vol. 18, No. 25 10
T
he Philippines and other rising Asian nations’ export earnings are predicted to improve in 2014 as the world’s biggest economies push global demand for goods. The purchasing managers index (PMI) for the manufacturing sector of key export markets was on the rise, the Institute of International Finance (IIF) reported. In IIF’s “Global Economic Monitor” report, the growth of the export markets’ manufacturing sector showed that demand for raw
What’s New? (A synopsis of selected book acquisitions at the DTI-TIIC library)
The IIF’s export projection was consistent with that of the Philippine government. The report said the country’s exports could be seen a more solid recovery in 2014. A more significant rebound is expected next year due to China and other industrialized economies’ rising demand.
Title : How to Make a Benta: Anecdotes, Lectures, and Articles from the Advertising Wars
Title : Builders Directory Philippines 2014
Publisher : High Rise Rich Ventures, Inc. Call Number : 45 608/00.07/HIG/ 2014 Philippine Postal Permit No. PM-04-08
materials and intermediate goods, including those coming from emerging Asian countries, could rise over the short term.
It is a compilation of various directories of construction institutions or groups such as associations, realty and developers, contractors and suppliers, with their profiles and contact details. It also contains an alphabetical index of product listing of companies. 468p.
Author : Macabenta, Greg B Publisher : Minority Media Services, Inc. Call Number : 45 608/06.09/mac/ 2011 This book contains intimate anecdotes, packed with revealing insights drawn from campaigns that are considered classics in Philippine advertising and in ethnic marketing in America. It can serve as a valuable resource for advertising students and even promises enjoyable reading for industry veterans. Legend:
Entered as Third-Class Mail at the Makati Central Post Office under Permit No. PM-04-08 valid until 31 December 2013
PDI TMT TPS
- Philippine Daily Inquirer - The Manila Times - The Philippine Star
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. Neneria Circulation/Myrna V. De Los ReyesTo subscribe, email: publications@dti.gov.ph