The Philippine government and businessmen are encouraged to prepare the country’s industries for the coming integration of the Southeast Asian countries by 2015 through the ASEAN Economic Community 2015 (AEC 2015).
They need to prepare these industries so that they could compete and maximize the opportunities when the integration would happen, said Asian Development Bank senior country economist Norio Usui.
AEC 2015 is designed to make ASEAN (Association of Southeast Asian Nations) a single market and production base and a strong regional economic bloc in the global economy where there will be free flow of goods, services, investment capital and skilled labor following the liberalization.
The countries that will be integrated includes the Philippines, Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Singapore, Thailand, and Vietnam.
“The Philippines had a dramatic liberalization too and this integration should benefit you. However, you must aptly prepare your industries so that you can compete with all the products that will flow freely into the domestic market,” said Usui.
Usui spoke to over 50 businessmen and business group leaders in Marco Polo Plaza Hotel last Tuesday for the 2nd National Business Conference of Independent Business Clubs and Chambers.
Philexport executive director Fred Escalona agreed.
“From my personal point of view, one way to really ensure the competitiveness of our local industries especially the exporters is to do something about our cost structures,” said Escalona.
Escalona said that our yearly wage adjustment would make export manufacturers less competitive over the years because they would incur more operational costs making them unable to compete based on price points with our neighbors in the region.
On the brighter side, Escalona said that the local manufacturers could also outsource jobs to other countries with lower labor costs like Myanmar and Laos once AEC 2015 would convene.
Trade Undersecretary Adrian Cristobal Jr., however, said that the government had already developed a unified industry and international trade strategy guided on the three pillars which included institutionalizing stakeholder engagement in industry and trade policy making, trade and industry policy research network and capacity building, and enhanced inter-agency coordination and capacity building for trade negotiators.
“At the base of these three pillars is our industry competitiveness. This is one of the main shifts in strategy that was lacking in the past, a foundation upon which our international trade policy and negotiation positions are aligned. We need to identify the strengths and weaknesses of our industries, the opportunities and threats,” said Cristobal.
He said that they were working on road maps for specific sectors like chemicals, copper, and copper products, furniture, biodiesel, petrochemicals, and auto parts.
“We expect to complete most of these road maps and the comprehensive industrial strategy by the 1st quarter of 2013.this in turn will feed into the PDP (Philippine Development Plan) review and the IPP (Investment Priorities Plan) for 2013,” Cristobal said.
One of the best ways to increase productivity in export and ensure that industries can compete when the integration comes in to attract manufacturers to locate in the country, said Usui.
Cristobal agreed and added that the government was aggressively marketing the country as a destination for manufacturing companies.
According to Cristobal, companies like Fujifilm Optics Philippines, Inc., a subsidiary of Fujifilm Japan, for the manufacture high-performance lenses for digital cameras, projectors and CCTV (surveillance) cameras, Philippine Manufacturing Co. of Murata, to manufacture electronics products are now in the country.
“We are now encouraging 230 suppliers of Canon in Japan and China to co-locate in the Philippines,” Cristobal.