MANILA, Philippines - The country’s trade and investment climate had its share of highs and lows during the first year of the Duterte administration.
“It’s either you love him or you hate him,” was how some businessmen felt about the President and his policies – some of which they lauded as those resulted in better trade and more investments, while those they felt questionable dampened prospects.
For Trade Secretary Ramon Lopez, the renewed and strengthened relationship with the powerhouse economies of China and Russia, along with enhanced ties with Association of Southeast Asian Nations (ASEAN)-member states and Japan, have so far been the biggest achievements of the Department of Trade and Industry (DTI) under the current administration.
Lopez said the country’s improving relationship with these countries not only helped turn around the Philippines’ export performance but also led to increased investments which will translate to more jobs for Filipinos.
“The country’s strong macroeconomic fundamentals and support for President Duterte’s 10-point socioeconomic agenda drove investor confidence to a higher level. Presidential visits and the DTI’s investment missions abroad have increased the interest of investors, as they gained awareness of the Philippines, convinced of the country’s potential,” he said.
The DTI said the President‘s state visits have so far resulted in investments amounting to $37 billion, official development assistance totaling $18 billion, and trade worth $4.3 billion.
The countries visited by the President include Indonesia, Vietnam, Brunei, China, Japan, Malaysia, Cambodia, Singapore, Myanmar, Thailand, Saudi Arabia, Bahrain, Qatar and Russia.
Heightened investor interest in the country is also reflected in the rising number of projects being registered with the investment promotion agencies attached to the DTI.
Investment pledges registered with the Board of Investments are tracking a 30 percent year-on-year growth to P290 billion from January to July 2017, while those approved by the Philippine Economic Zone Authority during the first 365 days of President Duterte in office have reached P268.36 billion.
Local businessmen likewise lauded the government’s efforts to open up the country to non-traditional markets. International Chamber of Commerce Philippines chairman Francis Chua said such undertakings have opened up the floodgates to more investments, particularly those from China.
Philippine Chamber of Commerce and Industry president George Barcelon, for his part, said significant investment pledges and official development assistance generated from Duterte’s state visits are all very positive for the economy moving forward.
Former Makati Business Club chair Ramon del Rosario Jr., however, earlier warned the country’s push to revitalize its relationship with China should not be to the detriment of ties with existing allies such as the US and the European Union (EU).
Duterte had lambasted both the US and EU for criticizing his war against illegal drugs in the country, resulting in numerous cases of alleged extrajudicial killings.
Such tirades prompted several American and European investors to put on hold their investment plans in the country.
Lopez, however, assured that the Philippines “remains a friend to everyone” despite the administration’s move to open up to non-traditional markets.
“DTI is determined to push its ‘Trabaho at Negosyo’ mandate for inclusive growth, providing Filipinos with enabling opportunities to improve the quality of life. In this agenda, DTI vows to increase investments that will translate to sustainable job creation, as well as to champion entrepreneurial initiatives – reaching the bottom of the pyramid,” Lopez said.
In pursuit of the government’s goal of achieving inclusive growth, the DTI has come up with a so-called manufacturing resurgence program (MRP) – a scheme designed to revitalize the country’s manufacturing sector.
“MRP targets to close the gaps in industry supply chains, provide access to raw materials and expand domestic markets and exports for Philippine manufactured products. The key goal is to enhance the competitiveness of domestic manufacturing industries so they can be integrated in higher value-added, ASEAN-based production networks and global value chains,” Lopez said.
The trade chief said MRP aims to hike manufacturing’s contribution to total value-added to 30 percent from 23.2 percent, and total employment to 15 percent from 8.3 percent.
“We are on track – the manufacturing sector’s growth has been increasing, signaling a resurgence. The resurgence of manufacturing is critical in generating jobs not only for skilled workers, but also for semi- and low-skilled workers. It will also allow the movement of workers from the informal to the formal sector and from low value-added activities to high value-added activities,” he said.
Complementing the push toward more trade and investments for the country are efforts that uplift and support the country’s entrepreneurs – an advocacy which Lopez has been championing for since day one.
“Another great accomplishment for us is the heightened assistance to those who need much help which is the micro, small, and medium enterprise (MSME) sector, especially in terms of competency building through training and mentorship as well as microfinancing through programs like P3 and micro loan guarantees,” he said.
Lopez said more programs to promote entrepreneurship, improve the productivity and efficiency of MSMEs, and increase market access of products and services were made available to existing and potential enterprises during the first year of the Duterte administration.
Of the existing 512 Negosyo Centers, 261 have been established since President Duterte assumed office.
Since July 2016, 195 shared service facilities were likewise established, providing MSMEs within the industry clusters with machinery, equipment, tools, systems, accessories and other auxiliary items under a shared system to increase their productivity and improve their competitiveness.
The DTI has also made available P1 billion for the P3 or the “Pondo sa Pagbabago at Pag-asenso” program, of which P9.52 million worth of loans has been released to 180 micro businesses to date.
The program piloted in Mindoro, Leyte and Saranggani and three national micro-financing institutions covering 67 provinces as well as 38 local conduits with operations in 11 provinces have been accredited to date.
Lopez said market access support were also enhanced through Go Lokal retail store concepts for MSME products.
“With our desire to mainstream local products, the government through DTI has partnered with the Robinsons Corp., Philippine Airlines, SM Kultura, Rustans, Enchanted Kingdom, CityMalls and Ayala Malls to showcase Go Lokal brands,” Lopez said.