Rebuilding, Opportunity, Challenges in PhilippinesJune 6, 2014
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Doug Barry is a Senior International Trade Specialist in the International Trade Administration’s Global Knowledge Center.
Developing countries have plenty of difficult tasks to overcome while modernizing. The Philippines was a special case, as a 2013 typhoon brought destruction and tragedy to the islands.
But some good news has returned to a population inching towards the 100 million mark.
For one thing, GDP growth is at 7.2 percent, among the highest growth rates in Asia. That’s expected to continue, fueled in large measure by repairing damage from the deadly storm. Sound macroeconomic policies under President Aquino’s administration have been helpful, and robust growth is expected to continue.
Commerce Secretary Penny Pritzker visited this nation with a delegation of U.S. business executives to discuss ways the United States can support rebuilding and growth in the Philippines, and how to advance the U.S-Filipino commercial relationship.
“This is a young, growing, vibrant market,” said Senior Commercial Officer Jim McCarthy, who hosted Secretary Pritzker on her visit.
He points out that the Philippines is the 12th most populous and fourth-largest English-speaking country in the world. “The people here think well and favorably of Americans and American products.”
With a median age of 23, this market holds plenty of future opportunity for U.S. businesses.
In particular, opportunities abound for U.S. exporters in aviation, security, defense, franchising, energy, infrastructure, franchising, IT, just to name a few.
For all the upside, said McCarthy, “it’s important to remember the Philippines is a work in progress.”
Filipinos are working to improve transparency and eliminate corruption in the market. Improvements in the nation’s Ease of Doing Business rankings led to an increase in the country’s investment rankings from all three major debt-rating agencies.
Other challenges persist. With high economic growth and a rising population come strains on infrastructure, including power generation, roads, airports, and ports. Government procurement requires patience and determination.
McCarthy believes that U.S. Government services available in the country lower risks and increase the success rate for U.S. companies.
The Department of Commerce, through its U.S. Commercial Service in Manila, organized five U.S. trade missions last year, the first such missions in several years. Delegations came from the states of Utah and Iowa, and from sectors such as energy and education. In addition, the multi-sectoral Trade Winds mission came to the Philippines in 2013. Three more delegations will visit the country later this year and include franchising, medical equipment, and a mission from the State of Mississippi.
“The increased interest in our services shows dramatically more interest in the export opportunities in the Philippines,” McCarthy said. “We urge U.S. companies to take their first or a second look at the country.”