The name of the game is competitiveness. Philippine companies—as all firms operating in Asean—must find the means of enlarging their economic position, alone or in partnership with other regional or international firms. European Union companies, leading in technology, are ready to go into partnerships, as business opportunities arise in the Philippines and in Asean.
Let’s look at some sectors:
Mining and quarrying. Asean member-states are mineral rich and mining is playing an increasingly important role in the Region’s economic growth. In Indonesia Southeast Asia’s largest economy, mining accounts for 12 percent of GDP. Asia’s locomotive economies continue to drive Asean’s fast developing mining sector—unfortunately not in the mineral-rich Philippines. It is still trusted that the Duterte administration will fully implement and enforce the provisions of the existing Mining Act, maintain an internationally competitive fiscal regime for mining, and ensure consistency of local ordinances with regulations, decisions and policies of the national government.
Transport. Southeast Asia, a region of around 600 million people, with a combined GDP of $2.1 trillion, is not only a vast and developing market, it is also bound by the dynamic economies of China, India, South Korea, Japan and Australia. Facilitation of trade is vital for all Asean countries, which occupy an area at the heart of these leading global manufacturers. Trade among member countries themselves is steadily increasing with intra-trading expected to increase to 30 percent of total trade. As a result, transport and logistics have become big business in Southeast Asia, with some 275 publicly listed companies involved in the sector. Their total combined revenues reached $140.8 billion. For the Philippines, this means to accelerate the implementation of transport public-private partnerships and overcome legal objections swiftly; the Philippine government has to address cost, quality and competitiveness issues in logistics.
Aviation. The aim of the Asean Single Aviation Market is to foster a competitive airline industry and propel the Region’s carriers into the global market. It is a strategy that seeks to increase market access, establish central authorities and industrial standards, for a sector that is undergoing unprecedented expansion. Open skies will yield a host of opportunities for Asean members by removing obstacles to growth, such as restrictive airspace and route constraints. In the Philippines the decision has to be made to expand Clark and modernize the Ninoy Aquino International Airport, provide night-landing equipment to 14 airports and improve civil-aviation regulation.
ICT. Sustained investment in information and communications technology (ICT) is proving to be one of the most potent drivers of development for emerging economies. The strong focus on ICT development is having a significant impact on the Asean region. There is a master plan to deliver ICT as an engine of growth for all member-states and to establish the Region as a global communications hub. The Philippines telecoms and information-technology market is estimated to contribute more than 10 percent to the country’s GDP, boosted by the exponential development of mobile-data distribution. The Philippines is a leader in business-process management and will have to improve its telecoms infrastructure/broadband if it wishes to maintain that position. It is good news that finally the Department of Information and Communications Technology is created in the Philippines.
Health care. Health spending in Southeast Asia is expected to double in real terms over the next decade, outstripping GDP growth, as governments seek to improve standards and widen the scope of care available. There are wide variations in the Region. Several Asean members have passed laws to establish national health insurance systems and mandated universal coverage, including the Philippines. An integrated Asean market in health care consisting of harmonized standards, registration and evaluation, mutual recognition of qualifications and cross border cooperation greatly expand regional healthcare facilities, stimulating growth of a vital sector. The Philippines has to move fast to create a more decisive Department of Health and allow the Food and Drug Administration to play the professional role it needs to play in an expanding market.
Asean integration offers challenges and opportunities. Let’s make sure we master both!