UKTI poses the question, “why the Philippines?” The Philippines, one of the great success stories for UK exporters, is a Southeast Asian archipelago of 7107 islands (only about 2,000 are inhabited) with a population of 94 million (2010 estimate). Its capital city Manila (part of Metro Manila conurbation) has a total population of 11.55 million and is the country’s main centre of business. Although English is not the national language, it is one of the widely spoken official languages.
The country has a literacy rate of over 94%, one of the highest in the region, a highly skilled workforce and currently turns out a remarkable 400,000 graduates a year.
Exporting to the Philippines
UK Trade and Investment’s (UKTI) Asian Task force offer significant support for UK exporters targeting the Asian market.
While UKTI's advice is available for all Asian export markets, their primary focus is:
Association of Southeast Asian Nations Promotes investment in the Philippines
The Philippines is also an active member of the Association of Southeast Asian Nations (ASEAN), a group tasked with, “accelerating the economic growth, social progress and cultural development in the region through joint endeavours…”
Other member states are:
- Brunei Darussalam
- Cambodia
- Indonesia
- Lao PDR
- Malaysia
- Myanmar (Burma)
- Singapore
- Thailand
- Vietnam.
The EU – ASEAN trade relationship is an important one. As a group, it represents the EU’s third largest trading partner after the United States and China. During 2010, EU trade in goods and services stood at 175 billion Euros.
The Philippines has been a member of the World Trade organisation (WTO) since 1995 and is a member of the Asia-Pacific Economic Cooperation (APEC) group.
In business terms, the Philippines is strategically sited, only two hours by air to Hong Kong and little more to many of the other major Asian business hubs. Its South China Sea location means it is positioned astride a number of important shipping routes.
Total UK exports of goods in 2010 were valued at £286 million, an impressive increase of 11% on the previous year. The UK has also been the largest investor, over the last ten years, with combined investments of £6.6 billion (1999-2009). In 2010, the economy grew by 7.3%, fuelled in the main by strong service sector growth and domestic consumption. A healthy 6% growth is projected for 2011.
Of particular interest to UK exporters are the main industries, which include:
- Clothing and footwear
- Electronic components
- Food and Drink
- Electrical machinery
- Tobacco.
Moving away from the country’s traditional markets, UKTI has also highlighted a number of potential economic growth drivers. Particularly attractive to UK business are Business Process Outsourcing/call centre operations, a burgeoning sector that employs about 400,000 people.
It’s worth also noting that around 25% of the workforce is based abroad and consequently remittances home play a vital part in the country’s economy.
World Bank's Ease of Doing Business Index
While there are a number of positives in this business equation, there are inevitably a number of hurdles to overcome. A brief look at the World Bank’s Ease of Doing Business index, an examination of 10 of the most important business indicators, shows the Philippines at a lowly number 148 out of 183 ranked economies.
With its Southeast Asian neighbour Singapore topping the table the Philippines report card might well say, "Shows promise but must do better."
Sources:
UKTI, Philippines Business Guide, site accessed 7 September 2001
UK Foreign and Commonwealth Office, Philippines Country Profile, 7 September 2011
European Commission – Trade, ASEAN region, site accessed 7 September 2011
World Trade Organisation, Member Information – Philippines, site accessed 7 September 2011
World Bank, Ease of Doing Business in the Philippines, site accessed 7 September 2001
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