Philippines –the Rising Tiger of Asia : Opportunities and Challenges

PHILIPPINES AT A GLANCE Population : 100 million e

Land area (sq km) :

343,448.32

(132.43 sq miles)

- Luzon (147,947.63) - Visayas (59,873.84)

- Mindanao (135,626.85) spread over 7,101 islands

Capital : Manila

Major Cities : Manila, Cebu, Davao City

Currency : Peso (P)

GDP (US$ bil) : 272.1

GDP Growth (%) : 6.1

GDP Per Capita (US$) : 2,765.1

Inflation Rate (%) : 4.1

Unemployment (%) : 6.0

GDP by sector (% share) (2014)

Industry / Manufacturing 27.8

Agriculture 8.4

Services 47.5

PHILIPPINES AT A GLANCE

Major Trading Partners (2014)

Country USD BIl % Share

Japan 19.11 15.13

China 17.72 14.02

USA 14.35 11.36

Singapore 8.97 7.10

S. Korea 7.58 6.00

Malaysia (10th) 4.24 3.36

Major Export Destinations (2014)

Country USD Bil % Share

Japan 13.92 22.52

USA 8.72 14.10

China 8.02 12.98

Hong Kong 5.59 9.05

Singapore 4.45 7.21

Malaysia (11th) 1.16 1.88

Major Import Sources (2014)

Country USD Bil % Share

China 9.69 15.02

USA 5.63 8.72

Japan 5.19 8.05

S. Korea 5.04 7.82

Singapore 4.52 7.01

Malaysia (9th) 3.08 4.77

Source : Philippines Statistics Authority

MALAYSIA-PHILIPPINES BILATERAL TRADE

Electrical & Electronic Products

Chemicals & Chemical Products

Palm Oil

Crude Petroleum

Petroleum Products

USD745.6 mil.

USD467 mil

USD404.8 mil

USD295.8 mil

USD321.6mil

Malaysia’s Major Export Products to the Philippines (2014)

MALAYSIA-PHILIPPINES BILATERAL TRADE

Malaysia’s Major Import Products from the Philippines (2014)

Petroleum

Products (USD

55.8 mil)

Chemicals

and Chemical

Products

(USD59.6 mill

Crude Natural

Rubber

(USD61.7 mil)

Processed

Food (USD

91.4 mil)

Electrical and

Electronic

Products

(USD 1007.3

mil)

OPPORTUNITIES

Food and Beverages – Halal Juices Cookies Biscuits Snacks Noodles Spices Condiments

Restaurant/ fast food/ franchise

Products from competitors – Indonesia, Thailand, Singapore

Malaysian Products available in the market.

OPPORTUNITIES

Food and Beverages : Distribution Channels

(supermarkets, mini marts & convenience stores)

Market Size : • 100 mil population

• In 2015 household spending to reach USD222bn, share of the

spending will go towards food & non-alcoholic drinks with total

spend of USD85bn.

• Grocery retailers records current value growth of 4%, ending

2014 with sales of Ps1.8 trillion (USD40 bil)

• Growth for grocery retailers is largely impacted by significant

growth in convenience stores • Outlets record growth of 1% in

2014

• 135 supermarkets in Metro Manila and 60 outside Metro Manila

33 Supermarkets/ Mini marts / Convenience Stores registered

with Philippine Supermarket Association Inc.

OPPORTUNITIES Food and Beverages : Market Entry

Before

Find good local distributors /importers

- Same industry

- Know local regulations/standards

- Has good track records distributing/supplying to various supermarkets/stores

Market Study

- Filipino buying behaviour

-price/ packaging/ distribution channels

-regulations/standards

Participate in Trade Fairs e.g IFEX, WOFEX

After

Consumer’s loyalty

- Support your distributors / importers in marketing

-e.g participate in consumer fairs

Perfect Food Participated in Mafbex 2015, 22-26 July 2015

OPPORTUNITIES

Regulations

-All F&B products need to register with FDA prior to importation

-Valid importer licence

Buying Behaviour

-Price-conscious

- Small packaging

-Imported products are better

Trends

- Healthy

-Lifestyle on the go (fast & convenience)

Food and Beverages

OPPORTUNITIES

ICT- Software and Solutions

Market size:

To reach USD50 billion in revenue by the end of

2016

Opportunities:

E Government system

Application for banking sector

BPO support services.

Software and apps for mobile

Animation related services

Business solutions

Market Entry :

JV with local IT company

OPPORTUNITIES

Building & Construction Materials

Products : • Flooring • Plumbing fixtures & accessories / waterworks • Sanitary wares• Architectural structures•

Plywood/doors and other wood based building materials • Lightings

Market Size

•Gross Value of the construction : USD4.2 billion, growth rate in 2014 :20.5%

• target to construct 1 million housing units by 2016,

•construction of over 300 condominium projects in Metro Manila

• The projection of 1.3 million employment in BPO industry in

Regulation

• Import Commodity Clearance

• Philippine Standard Quality Mark License

Market Entry

- Distributors/ Importers

Trade Fairs :

Worldbex 2016

OPPORTUNITIES

Other Opportunities

Energy

-Solar

-biomass

-geothermal

-hydro

Infrastructure

- Airport

-Port

-Highways

Investment in agri based industries

- Palm Oil plantation & mill

- Rubber Plantation & processing

-Cacao Plantation & processing

CHALLENGES

Lengthy process for

FDA registration

Port Congestion &

Customs Clearance

Tax Structure

Not conducive investment

climate

IMPORTANT

Understand Filipino Culture

Culture

Partner Instead of Competitor

Partner

Unknown factor

?

• Find Partner before projects

Project

Your presence in important

Presence

Thank You.

Embassy of Malaysia

Trade Office (MATRADE)

Level 4/F, HanjinPhil Building

1128, University Parkway

North Bonifacio, Global City

1634 Taguig, Philippines

Telephone

+63-2-556 8645 / 8646 / 8647

Fax

+63-2-403 6387

manila@matrade.gov.my