THE Philippines sold more strategic goods—or products deemed to have military importance—last year to foreign markets, most of which were shipped to the United States.
In a news statement on Monday, the Department of Trade and Industry (DTI) reported that revenues from strategic goods exports rose significantly to $4.5 billion last year from just $3.6 million in 2020, according to reports submitted by the exporters to the department’s Strategic Trade Management Office (STMO).
About 98 percent of the exports were information security systems, equipment and components. The rest was accounted for by semiconductors and integrated circuits.
Bulk or 60 percent of the strategic goods were sold to the US, followed by Japan (21 percent), Singapore (5 percent), South Korea (4 percent) and China (3 percent).
“We are pleased that through the efforts of DTI and its partner agencies in the National Security Council-Strategic Trade Management Committee (NSC-STMCom), we have been able to leverage our strategic trade regulatory regime in order to convince more manufacturers to engage in strategic goods export,” Trade Secretary Ramon Lopez said.
This, he said, is “in line with the Strategic Trade Management Act’s (STMA) mandate of promoting economic growth by facilitating trade and investment in strategic goods while also meeting the country’s international obligations to implement effective measures aimed at preventing the proliferation of weapons of mass destruction and their delivery systems.”
Trade Undersecretary Ceferino Rodolfo agreed that the growth in strategic goods exports owed to increased confidence in the country as “a safe and secure investment location for strategic goods manufacture and cross-border trade.”
“We value the confidence that investors have placed upon us because this will pave the way for the full economic recovery of the country,” he added.
To 49th from 86th
The 2021/2022 Peddling Peril Index (PPI) report showed that the Philippines jumped to 49th rank from 86th place previously after scoring 482 points. This made the country the most improved nation in the implementation of strategic trade control.
The PPI report rates 200 countries based on their strategic trade control adoption and implementation. Among the five super criteria under the PPI, the Philippines saw the biggest improvement in ability to prevent proliferation financing. Score for this pillar rose to 113 from 29.
“We worked closely with exporters to ensure their compliance with regard to existing policies such as the STMA. This initiative facilitated the export of strategic goods which resulted to additional revenues for the exporters,” DTI-STMO Director Luis M. Catibayan.
The DTI reported that the intangible transfers of technology, a subset of strategic goods, yielded $650,000 worth of new investments last year, including nuclear energy contracts won by business process outsourcing companies.
The DTI-STMO has issued 13 export authorizations and registered 46 companies that seek to engage in or currently involved in cross-border trade of strategic goods.
In a statement last month, Lopez said the DTI is ready to enforce the Arms Trade Treaty (ATT), an international pact that seeks to prevent illicit conventional arms trade, following its recent Senate concurrence.
“The Philippines has once again demonstrated its commitment to effectively regulate the transfer of conventional weapons, ammunitions/munitions, and their parts and components thereby enhancing the country’s international credibility in the cross-border trade of such items,” he said.
Lopez noted that the Philippines became the first Asean member state to ratify the multilateral treaty, which came into force in 2014. The country signed the pact in 2013.
Image credits: Qilai Shen/Bloomberg