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Opening Remarks by Secretary Ramon M. Lopez
Preparatory Meeting of ASEAN Economic Ministers (AEM)

My fellow ASEAN Economic Ministers (AEM);
Deputy Secretary General Lim Hong Hin;
To all the delegates joining us today; Distinguished guests, Ladies and gentlemen, good morning, and welcome to the Preparatory Meeting for the 31st ASEAN Summit and Related Summits for the 31st ASEAN Summit and Related Summits.

Colleagues, allow me to express my heartfelt gratitude for your support for the Philippines’ chairmanship of ASEAN 2017.

This year, we’ve made good progress in getting the ASEAN Economic Community (or AEC) 2025 off the ground. We’ve managed to do this by concentrating our efforts on laying the foundation for the implementation of the AEC Blueprint 2025 through the Sectoral Action Plans (SAP) and the Consolidated Strategic Action Plan (CSAP).

We also worked doubly hard on enhancing our external partnerships. These include upgrading and enhancing our existing free trade agreements (or FTAs), intensifying our efforts to complete on-going FTA negotiations, considering new FTA partnerships, and strengthening our economic cooperation mechanisms. Nonetheless, there is much work that needs to be done in order to ensure that we stay the course.

Today’s meeting agenda covers very critical areas that are instrumental in advancing the region’s internal integration process, as well as in our economic integration efforts with our external partners.

We have as our major agenda the preparations for the 15th AEC Council, wherein we will take stock of on what we have accomplished thus far in moving the AEC forward.

We are also set to discuss outstanding issues in FTA negotiations. This year, significant progress has been achieved in moving the negotiations for the Protocol to Amend the ASEAN Japan Comprehensive Economic Partnership Agreement (AJCEP) and the Regional Comprehensive Economic Partnership (RCEP) to where it is today. But there are still areas that need to be further deliberated and ironed out if we are to finally conclude the negotiations.

  • In particular is the preparations for the Informal AEM-METI of Japan Consultations, which will take place later today. During our Consultations with Japan, we will discuss the only remaining issue to date that withholds the finalization of the Protocol on the AJCEP.
  • Another important agenda item that we will tackle today is the preparations for the Preparatory RCEP Ministerial Meeting. Discussions will focus on the Collective Assessment Paper to the Leaders and the Joint Leaders’ Statement on the RCEP. I understand the Assessment Paper provides an inventory of measures/targets that can be completed this year, those that need to be further discussed, and those that require reconsideration of current mandates. This is a welcome progress as it gives everyone a comprehensive overview of what has been achieved in the past 20 Rounds of RCEP Negotiations and gives us a sense of direction of where to proceed and what to focus our attention on. The outcomes of this meeting is expected to lead up to the RCEP Leaders Summit this 14 November 2017.

With this, I would like to thank everyone for your continued commitment to the AEC agenda and I look forward to more meaningful exchanges. Thank you and mabuhay!

 

Speech of Secretary Ramon M. Lopez, Kalye Negosyo Graduation

 

Speech of Secretary Ramon M. Lopez, OKB Trade Fair

 

Speech of Secretary Ramon M. Lopez, Bahandi Eastern Visayas Trade Fair

 

Talk Points of Secretary Ramon M. Lopez, Inclusive Innovation Conference 2018

 

Message of Secretary Ramon M. Lopez, Memorandum of Agreement (MOA) Signing of DTI and the Bangko Sentral ng Pilipinas (BSP)

Message of Secretary Ramon M. Lopez
MOA Signing of DTI and BSP
17 September 2018, Bangko Sentral ng Pilipinas, Manila
(as delivered)
 
[Acknowledgements]
 
To our partners in MCPI and APPEND, to all the advocates here from DTI, Bangko Sentral, and the Micro Finance Council, Magandang hapon po sa inyong lahat.
 
Today’s event is another milestone in the government’s efforts, to promote the Micro SME in the country. Micro SMEs, which is you know is a priority program of President Rodrigo Roa Duterte. Empowering the Micro SME, not only with the know-how and mindset, but this time with the financial support is definitely a key tool to upgrade any micro enterprises we have in the country today. And this to us is the real solution to poverty and inflation. We are empowering the people. We rely to steady jobs and empower them. And as they say, don’t give him a fish but teach him how to fish.
 
We all know that MSMEs is about 60% provider of jobs in the country and 99.6% accounting for all the enterprises. It is a huge contributor to the economy. However, one factor that used to be a challenge, which is GDP contribution, gaining about 40-45%. We have to adapt, the challenge for us to really empower them to increase their know-how. And we want to create smarter entrepreneurs basically to increase the value-added capability, and that is given through mentoring, seminars and kind of programs that we have.
 
The value-added is given in ability to prosper more. As you know, the value-add gives better profitability, and that is the real solution to poverty. Sometimes, in order to get there, we also need of course, almost all the time, we need the financing. And the kind of partnership we are entering right now is one that we really need. Financial solution is really important. As they say, when you want to be good in corporate, you have to gain education. But when you are a micro entrepreneur, you need micro financing. ‘Yun ang kailangan po.  It is really difficult to have this kind of set-up but definitely with our partnership, we will be able to create a much clearer environment [and] more opportunities for all.
 
More entrepreneurs before would be engaging in the “5-6”. Nagagalit ang ating Presidente. He wants to get the “5-6”, not the lenders but the “5-6” assistance. That’s why, we try what the micro finance institutions are doing. We also launched anti-“5-6” program which is the P3, Pondo sa Pagbabago at Pagasenso. It is being administered by SB Corporation, with micro finance institutions and cooperatives as partners. That is our way to also propagate a low-cost financing at the same time low collateral immediate taxes in financing. And we all know that MCPI, the members, are being a partner in that endeavour.
 
The Memorandum of Agreement (MOA) that we are signing today is another step in this direction of empowering MSMEs to expand the financing ecosystem of the DTI’s Negosyo Centers and also the market access. We have a product because of the private market access, and provide models of negosyo for those who have no big idea right from the start. We can offer that in Negosyo Centers. Now, in this partnership, we can offer more on micro financing.
 
With the knowledge, information, resources, and networks of our new partners, we can give entrepreneurs who seek help from our Negosyo Centers greater access to financing. Moreover, this partnership will widen our network of support—from financial providers to industry associations. Thanks to this network, entrepreneurs will now have more options not only for loan products, but also on savings, electronic payments, and insurance.
 
This partnership will also boost the programs that we have in DTI, as mentioned, of course, aside from Negosyo Centers, the 7Ms that we have with this we can maximize the marginal aspects of 7Ms.
 
Putting it all together, as our MSMEs become financially literate and can now make sound financial decisions, they will also have access to the right financial service providers and products.
 
To conclude, while DTI is committed to MSME development, we are glad for the support from our fellow government agencies and private sector partners. That’s why I want to thank BSP, MCPI, and APPEND once more for working with us on turning this project into a reality.
 
Together, we will realize the President’s vision of addressing income equality and lifting the quality of life for all Filipinos on the back of greater inclusive economic growth.
 
Thank you po at mabuhay kayong lahat.♦

Speech of Secretary Ramon M. Lopez, Philippine Garments, Leather Goods Industries & Fabric Expo

Speech of Secretary Ramon M. Lopez
Philippine Garments, Leather Goods Industries & Fabric Expo
23 August 2018, SMX Convention Center, Pasay City
 

Thank you and good morning, everyone. Thanks to Dr. Andrew Kay, Mr. Nick Reyes. Regards to Mayor Calixto. For the information of everyone, Pasay City was one of the major awardees in the recently concluded Competitiveness of Cities and Municipalities. Pasay is one of the major competitive cities and municipalities in the country today.
 
To our DTI and BOI family, ED Corieh, Our good friends from PETCO [Philippine Exhibits and Theme Parks Corporation] Marissa and Heidi, for so many years, more than a decade already. Hindi naman two decades, possibly.
 
Ladies and gentlemen, let me, of course, welcome the delegates from many countries. Vietnam, India, and Hong Kong and many other countries represented today. Thank you for your trust and support in projecting the Philippines as one of the major players in leather goods, garments, textile, [and] fabric. Our friends from PTRI [Philippine Textiles Research Institute] are also, of course, in support of this endeavor.
 
The trade fair is an effective platform to showcase all the recent latest technologies that we have in the textile, garments, footwear and all these industries that are mostly participated in by the Micro SMEs in the country today. In fact, we’ve launched several platforms as well that would sell many of our products to the mainstream market.
 
We have the Go Lokal! that sold top quality Micro SME products in the mainstream malls and markets on an everyday basis, not just on exhibits and trade fairs for a limited number of days but is essentially an area for them to be incubated for their market.
 
We’ve also launched yesterday the One Town, One Product (OTOP) Philippine Hub. These are displayed and showcased in the Sikat Pinoy National Trade Fair. It is still ongoing for the next three days. This is at the Megamall, in the middle part of Metro Manila.
 
As you know, the Philippines [has] so many good stories nowadays. We can always say that the Philippines is on the breakout with so many good numbers coming out. The GDP, 6.7%, even though it’s 6% [now], [the year-to-date GDP] is still above 6%. Manufacturing is close to 8%. Employment in the wearables accounting for 20-30% of manufacturing. Manufacturing used to be at the 3-4% growth rate only in the past but now reaching 7-8%.
 
Investment keeps on pouring in. Today, we posted 28% growth in investments. Last year, we reached a 50-year record for investments in the Board of Investments of Php 617B. FDI, US$10.2B. Another high-level last year and still posting double-digit this year. So many good things to say.
 
[In] Demographics, we have a young population that is now more employed so you can imagine that this will go on for so many more years in enlarging the consumer base. There are now 106M Filipinos [with an] average age of 23 years old. So you can imagine a growing in middle class, a young market that will continue to grow and that’s the reason why the malls are freed up, most people coming up, condos being built left and right.
 
Property prices [are] 10x more than in just a couple of years ago in terms of prices. You can see even steel and cement that we keep on importing from Vietnam due to the add-on to the production capacity that we still have part limited nowadays, and you see that the growth has even on a rapidly upward slope. It used to be, just in the past 10 years, flat. I say 3.5M metric tons for steel and close to 20M for cement. But in the last four years, it keeps on going up by I think about 20M metric tons every year. So fast, so rapid. That is the reason why some brands have been projecting Philippines to become the 16th largest economy by 2050 and hopefully even earlier than that.
 
The Duterte Administration is very much into macroeconomic reforms, tax reform, so many reforms being done to make sure that the economy will continue to have a sustainable macroeconomic environment that will support the growth of many industries. We will continue to support the export sector, continue to support the industry sector with the launch the manufacturing resurgence strategy, we will continue to support innovating inclusive industrialization. We will promote creativity, creativity that really characterizes these industries that we are celebrating today.
 
For the DTI, our task is to provide a 360-degree support to the Micro SME sector from providing free seminars and trainings, changing mindset, mastery of entrepreneurship, continuous mentoring, providing them with microfinancing loans as our way to replace the 5-6 loans. This is the program started with the president in an effort to really provide the much-needed capital especially for the Micro entrepreneurs, low collaterals needed, etc. and providing them machines as well­, hopefully, the machines here will also be provided to the many entrepreneurs out there.
 
The DTI provides machines for cooperatives and groups of entrepreneurs. But the DOST [Department of Science and Technology] provides machines for individual entrepreneurs. So we compliment our programs and once they have the product as mentioned, we give them the mainstream market in the malls and exhibits like this. So we are very happy to be part of this.
 
We hope that we can continue to grow these industries here and maximize the Free Trade Agreements (FTA) that we have. We have FTAs with ASEAN and Japan. We are now doing the RCEP [Regional Comprehensive Economic Partnership] with ASEAN and China, Vietnam, Korea, India, Australia, New Zealand.  We would also like to maximize the [European Free Trade Association] EFTA-Philippines FTA. And we continue to enjoy the GSP with the EU and that’s a GSP+, and GSP in the US.
 
Recently, we included the travel goods [in the GSP] and hopefully, we can add footwear in the near future. And hopefully, that can translate to more investments into these sectors as we start discussions of FTA with the US.
 
So I guess with this, we just look forward to a more vibrant sector for footwear, leather goods, textile, garments, and really help these industries help the country achieve inclusive growth and a more prosperous Philippines in the years to come.
 
Maraming Salamat po. Good Morning.

 

Message of Secretary Ramon M. Lopez, 6th Competitiveness Regional Summit

BUILDING LOCAL COMPETITIVENESS AND EASE OF DOING BUSINESS
Message of Secretary Ramon M. Lopez
6th Regional Competitiveness Summit
16 August 2018, PICC, Pasay City
 
[Acknowledgements]
 
To honorable mayors, governors from around the country, isa pong mainit na pagbati sa inyong lahat. Good morning!
 
To our favorite Undersecretary for Competitiveness and Ease of Doing Business dahil isa lang po siya, Usec. Rowel Barba. And to our DTI family, Undersecretaries, Assistant Secretaries, former DTI Secretary Che Cristobal. New Zealand Ambassador David Strachan. And all our partners and distinguished guests, magandang umaga po sa inyong lahat.
 
Every time we conduct this competitiveness summit, we’re always excited. Because this is really the anchor of all our efforts to invite investments into the country and really asking them to help in regional development—regional progress.
 
And you know what, I will start by saying the many investors that we invite, of course, they would pay courtesy calls to the national government, pay attention to the results of this survey to help guide them on where to invest in the Philippines.
 
Normally they’ve already decided to come in the Philippines to invest. But selecting the site, where to locate, is the next question.
 
If I were the regional, provincial, city, and municipality official, it is important for them to fare very well because chances are these competitiveness indices are being referred to by investors, especially those not familiar with regional conditions.
 
To us this is really a good indication for them to tell them where to invest their capital. While we want them to achieve development in their respective areas, we really have to do something with respect to that. We have to create ease of doing business, good infrastructure, so on and so forth.
 
In the end, it will really help us invite investors to our areas. If they come in, they will bring more jobs and prosperity. And with more prosperity, come more economic activities and attracting more investing. So the virtuous cycle will start.
 
More investors coming in higher property prices. Of course higher property prices, many of us will benefit from that. Higher property prices, higher revenue for all of you. More importantly, poverty incidence will go down. We see this in many cases. Many provinces, cities, municipalities who have attracted investments have reduced poverty indices in their areas. So many good stories.
 
To the winners here, I hope you serve as inspiration for others to really do their best in improving the business climate in their respective areas.
 
So I guess my time is up? Nag-bell na yung sa likod. Pero magsisimula pa lang po tayo. Let me begin, hindi ako presidente kaya kailangan ko pong basahin ‘yung speech. Maganda ‘yung ginagawa ni Presidente. He would read the last paragraph. That says it all. Kaya hintayin niyo po ‘yung last paragraph.
 
As we recognize the most competitive cities, municipalities, and provinces, let me congratulate the winners of the 6th Regional Competitiveness Summit. These are the winners that exhibited remarkable feats in advancing the competitiveness of their respective localities.
 
PRRD 3rd SONA Marching Orders
 
Even as we celebrate the achievements of our Local Government Units (LGUs), we also need to heed the call on what needs to be done to improve ease of doing business in our country.
 
All of us heard loud and clear President Rodrigo Roa Duterte’s pronouncement during the Third State of the Nation address to faithfully implement Republic Act 11032, or the Ease of Doing Business Law. Our President further called the attention of agencies with red tape-related reports from the public to make their services truly customer-friendly.
 
Our people deserve an efficient, effective, and responsive government service. That’s why I must reiterate the President’s call to our LGUs: we must start streamlining our business permits and licensing procedures as mandated by the RA 11032. I must tell you, so many exciting things happening here. Maibabalita po sa inyo yan in a while.
 
Aside from streamlining, we must also start adopting GovTech (or government technology) in our processes, by automating the manual procedures. So first, we streamline and then we automate. These cover procedures from filing, processing, to payment. Kapag ganyan kadali mag-register sa inyong lugar, siguradong mag-uunahan ang mga investors sa inyong lugar.
 
Ease of Doing Business and Competitiveness
 
One way we can improve our procedures is through globally-accepted tools that can help us identify issues and obstacles. In the case of the Philippines, the Cities and Municipalities Competitiveness Index (CMCI) was developed using the competitiveness framework by Michael Porter, which is also used in global competitiveness surveys.
 
Porter’s definition of competitiveness is based on the idea of productivity. Putting it in the CMCI perspective, local competitiveness is how a city or municipality knows its resources and how it uses these to improve its standard of living.
 
Two of the CMCI’s indicators, the Business Registration Efficiency, and Compliance to BPLS standards, focus on ease of doing business. Tweaking these indicators could mean a lot for an LGU’s competitiveness score.
 
This will also impact other indicators, such as the size and growth of the local economy—which are determined through business registrations, capital revenue and permits. Ibig sabihin, kapag mas madali na ‘yon, mas maraming magreregister na negosyo. Likewise, it will also affect the capacity to generate employment and the cost of doing business.
 
I am thankful to the CMCI because now we have established that there were 1,853,978 approved business registrations nationwide in 2017, more than double than the 2016 data from the Philippine Statistics Authority (PSA). Matagal ko na pong naririnig na 900,000+ ang registered businesses. Now we are seeing 1.8 million. Palakpakan po natin, tayo pong lahat ‘yun.
 
Out of the total approved permits, 377,725 were new business applications while 1,476,253 were business renewals.  Also through the CMCI, we are able to populate the Philippine Business Registry Databank, with a list of 780,238 businesses as of the 1st quarter of 2018.
 
Having said this, I encourage all LGUs to build their competitiveness through reforms. You can start by streamlining your procedures and aligning with the EODB law, as well as implementing GovTech to achieve seamless and efficient delivery of government service.
 
Actually, as we go around, we encounter a lot of success stories. We must credit many LGUs who have achieved improvements like business registration within 30 minutes. Talagang they made it very convenient. They are also exercising automation after they streamlined their businesses. For all of you who did that, you deserve a big round of applause.
 
Project One: One Form, One Number, One Portal
 
The Department of Trade and Industry (DTI) has already started its own GovTech journey via the implementation of the Project One: One Form, One Number, One Portal. This project aims to develop innovative systems that will drastically streamline the business registration process from end to end. It will also provide a more pleasant business customer experience that is easy, and not confusing nor cumbersome.
 
Ang aming pong sinasabi, parang lang kayong nagbu-book ng movie ticket. You fill out, you pay, and you print. In our case, maraming dinadaanan: DTI, SEC, Philhealth, Mayor’s Office, etc. Ang idea ay, ano ng aba yung mga critical and common information that we should keep. And we should put that in one form and share with all of us. Ire-replicate lang po yung one form and send to all. Pagbayad, isang bayaran na lang. It’s just a matter of allocating this and remitting to the different agencies. Napaka-simple lang naman. And knowing the Filipinos, kakayanin natin ‘to.
 
But even if we improved our World Competitiveness scores last year, other countries made greater improvements. That’s why our rankings slipped. Kaya po ang kailangan natin ay leapfrogging. Maraming frogs. Maraming palaka ang kailangan. At zero-budget type. Total zero naman ang budget natin. Zero budget type na ano talaga ang kailangan. At kapag nag-leapfrog tayo sa score, yung goal natin na top 20% by 2020, or by 2021, ma-achieve natin.
 
Project One promotes bureaucratic singularity, parang isang gobyerno na lang, through a whole-of-government approach and addresses governance concern on data sharing, data accuracy, access to data, and privacy issues.
 
This project shall develop three outputs using Design Sprint, which is facilitated by CreativeHQ. Design Sprint is a 5-day highly-innovative problem-solving process that engages experts from the government, business, and information and communication technology (ICT) sectors to come up with a solution.
 
Currently, we are tapping the assistance of the young and creative startup community in developing prototypes under Project One. Mr. Stefan Korn, CEO of CreativeHQ is joining us today to present the first output of Project One, a work in progress, I must say. Hindi pa ito yung final. This is an online portal containing useful information on the business registration process in local government units (LGUs).
 
This project aims to address the absence of a single source of information for transacting at the local level, a concern that restrains businesses from doing business in the country. This is a sort of “Wikipedia” of LGU-related business permitting information. A business or an investor can search and compare doing business information of LGUs, such as step-by-step procedures for business registration, documentary requirements, and the cost of registration and other applicable fees in LGUs.
 
I urge all LGUs to join us in transforming this portal into a useful tool for our businesses, by sharing your business permitting procedures and other relevant databases with us.
 
After the online portal, we intend to develop a framework for the One Philippine Business Number, which shall address the difficulties of getting business registration numbers from different government offices. The Unique Business Number will offer a more efficient way of dealing with various government agencies, even as it eliminates redundancies and confusion in the process.
 
The last of the three outputs is the end-to-end registration process. The team shall develop a mobile app that will serve as an all-in-one tool for business registration. So ‘yung ating one portal and one application, it will just be on our smartphones. Business registration is presently done on-site, by going to frontline offices, or through online, which involves many websites.
 
This can be solved by the end-to-end registration process which can be done by filling up a single form through the web—and ideally with a smartphone. This is our ultimate goal: that setting up a business can be as easy as buying a movie ticket on your phone.
 
GovTech as Driver of Competitiveness
 
Speaking of GovTech, we are pleased to note that the Philippines improved its ranking in the eParticipation Index, leaping 48 notches to 19th place. Palakpakan naman natin ang GovTech. The eParticipation Index is a component of the 2018 UN eGovernment Survey that measures an economy’s effort to establish online tools on government portals to promote public participation via public consultation and decision-making process.
 
Even though we slipped four notches to 75th place in the other component, which is the e-Government Development Index, the Philippines still managed to increase its scores in two of three sub-components. These are the Online Service Index (OSI) and the Human Capital Index (HCI). Unfortunately, we declined in the Telecommunication Infrastructure Index (TII).
 
It is by adopting GovTech that we can sustain the gains or even accelerate in the UN eGov Survey.
 
Likewise, I fervently hope we can see a similar improvement in the Doing Business Survey, in which we are targeting to land in the top 20% of the survey by the year 2020. I know this is going to be a stretch target, but with the speedy implementation of the provisions of the EODB law and the automation of government processes, this shall be realistic and attainable for us.
 
Closing: A Challenge to LGUs
 
In closing, I want to say that as stewards of local governance, I challenge all our local chief executives to reinvent the ways of delivering government service. Kapag happy ang investor, pabalik-balik yan at magre-refer pa ng iba. Parang business ‘yan na may suki.
 
We need to shift our mindset, from being regulatory-focused to becoming customer-focused. We should do things with E.A.S.E: Efficient and fast government service that is Automated or can be accessed electronically, anytime, anywhere making it convenient. These services will be Seamless, brought by interconnectivity and coordination, and Economical, which costs less for the Filipino citizens and businesses.
 
Furthermore, I urge all the LGUs to level up the competitiveness of your localities, so that you can attract more investments and create more jobs for Filipino people. All these efforts are leading us into the right direction, towards what our President envisions: a prosperous Philippines where our people can enjoy a better quality of life.
 
Mabuhay and once again, congratulations to our most competitive LGUs!

Speech of Secretary Ramon M. Lopez, 4th Forum on the Mining Policy Direction of DENR

Speech of Secretary Ramon. M. Lopez
4th Forum on the Mining Policy Direction of DENR
July 31, 2018, La Breza Hotel, Quezon City
 
 
Good afternoon everyone. Sec. Roy Cimatu, maraming salamat po for allowing us, the DTI family, your partner is sustainable development to be with you in this forum this afternoon.
 
To the officials of DENR, Usecs, Asecs, and Directors, and your colleagues,
 
To the stakeholders in the mining industry,
 
At ang aming pong mga kasamang mga bamboo advocates, pinapangunahan po ni Atty. Leo Dominguez who is a part of your family, GM Ed Manda, because you might be wondering kung ano yung ginagawa ng mga nandito sa grupo na to. Si GM Ed Manda.
 
Si DTI Regional Director Judith Angeles ng Region. Siya po ang Cluster Development Head ng Bamboo Cluster ng DTI because we assign industry clusters from plantation to the finished products per regional director, so si RD Judith sa bamboo.
 
Director of BOI, Nestor Ansalin, Mr. Cris Lacson, another partner in the advocacy and the rest of the DTI and BOI family.
 
We are here to present the possible partnership between DENR and DTI. We have shared objectives. Our President has always raised concerns on sustainable development.
 
By the way, I am the other Lopez at the Cabinet. So Ramon Lopez, still here. But I don’t know up to when.
 
But the same concern, as we want to push for development, we are very much aware of environmental sustainability and environmental protection. Time and again, we are always challenged.
 
We in the mining industry, isasama ko na yung sarili ko at ang DTI because it’s an industry development concern on how we can really have a sustainable industry, especially talking of rehabilitation.
 
Several occasions, our President has mentioned that he is concerned, especially on the rehabilitation of open pit. Napapansin niyo yan ano? Short of, I don’t know kung nag-issue na Sec. [Cimatu], ng policy on open pit or against open pit, but short of banning it.
 
But it’s really up to the [DENR] Secretary and the stakeholders on how we can present a viable proposal to make it a sustainable kind of development. Because our President is simply concerned on—mga maliliit na community, mga maliliit na tao and the environment. ‘Yun lang naman ang mga gusto niyang ma-address. If we have an answer for that, then we can present a viable sustainable plan moving forward; and that is important.
 
To present an alternative, we understand that this concept is not really new. But this is something that we can all adopt and have a bigger participation to. And we’re talking of planting bamboo as a rehabilitation plan in your mined areas, especially in the open pit areas.
 
We have the team here to discuss how it can be done, even in the technical viability. I understand that this is also being done by some of the companies. But this is an area that can really make mining a sustainable undertaking.
 
And I understand that you are supposed to allocate a fund for this rehabilitation project. Tama ba? There is this 3% of OPEX? Whatever the amount is, that amount will definitely be very useful. Idi-discuss na lang natin nila Sec. Roy on what should be the amount. And that amount is how much can be allocated to a bamboo rehabilitation program.
 
For DENR, this is a win-win approach. Because of course for DENR, the goal is always sustainable development. And I read in one article that in the Climate Change Commission, we are supposed to plant 1 million hectares—I’m not sure if this is just for bamboo or for all other trees.
 
And of course for many of us who are environment advocates, there are a lot of benefits. There’s beauty in having a bamboo plantation. It’s fast-growing, has a high carbon absorption, the best environment cleaner as we say. And there is relative ease in implementation.
 
For the Board of Investments and the DTI, it serves as raw materials for higher value bamboo products. And we can show you a lot of possibilities on bamboo products. Not only limited for poles for walling for table, ‘yan na ‘yung mga old style. Now we have re-engineered bamboo products for panels, walls that are smooth. Also for food, for beverage, for beer, there are many uses. As food, all the leaves there, ‘yung mga shoots. Flooring, the basic uses for charcoal, fiber boards, handicrafts, lumber, etc.
 
The DTI is the head of the Bamboo Development Cluster Council and of course we support not only creating bamboo products but also the supply of the raw materials. And we have to work closely with the DENR to make sure that we have an integrated and complete supply chain from planting all the requirements that will be needed on the demand side.
 
Our estimate, and this can be validated later, we have about 5 million supply right now of bamboo and the demand is somewhere in the vicinity of 20 million. Malaking kakulangan, 20 million would be needed. And in terms of hectares, right now, is only about 10,000 hectares. But I asked, earlier, and ang mined area is 300,000 hectares. So marami pa tayong pwedeng paglagyan ng bamboo. We’re only in the 10,000-hectare size, but 300,000 is a good possibility to plant bamboo.
 
We are here to help you. This is a whole-of-government approach to address the supply chain issues on bamboo from production to the use of bamboo-based products. To the communities, it will provide livelihood, from raising to initial stage processing, para may value-added na gagawin sila. There can also be consolidating of the supply of bamboo.
 
For DENR, it talks about suitability and greening. For DTI, it will supply the needs of the manufacturers of bamboo products. At the end of the day, we see this as an opportunity for bamboo products to provide more sustainable means to alleviate poverty, especially in the communities near your mining area.
 
We solicit your support and the support of our partners in the DENR. Maraming salamat, Sec. Roy and the team for giving us this opportunity. This is just an opening statement but I hope that you will allow some members of the team to give a short presentation on bamboo. We will try to make this quick. Salamat po for giving us the first item in the agenda.
 
Thank you.

Message of Secretary Ramon M. Lopez, Go Lokal! Launch at NAIA Terminal 3

Message of Secretary Ramon M. Lopez
Go Lokal! Launch at NAIA Terminal 3
 
 
Sa pamilya ng DOTR, na pinangungunahan po ni Secretary Art Tugade na aking seatmate sa Cabinet meetings.
 
Our newest partner, sabi ng ni GM, this will not be the last, but only the first of its kind of branch that would be located in SSI (Store Specialists, Inc.), led by Mr. Anthony Huang. Si Mr. Huang nakakasama ko na yan sa mga investment roadshows before when I was in the private sector.
 
Of course ang isang malaking ka-partner din po natin, ang Double Dragon sa mga City Malls, Mr. Federico Gutierrez;
 
Dr. Jun Valderrama na maraming pinapatakbong Go Lokal! Even in the DTI showroom, sina Dr. Jun ang nag-ooperate po niyan.
 
Air 21 team, Joseph Panganiban. Sasabihin ko na, 50% off ang kanilang logistics requirements para sa mga Small and Medium Enterprises (SMEs).
 
Ms. Felicisima Enriquez, Rustan’s Commercial Corporation.
 
Dr. Nathaniel Von Einsiedal of CONCEP.
 
Duty Free COO Mr. Vicente Angala,
 
Mactan Cebu Airport DCCO Ms. Cristina Angan.
 
At ang Go Lokal! Team ng DTI, ang Trade and Investments Promotions Group, lahat po ng DTI officials, Undersecretaries, lahat po ng staff at lahat o kayo na nandito dahil kabahagi po kayo ng Go Lokal!
 
Ang Go Lokal! po ay, tulad ng inexplain kanina ng ating kasamang host, ay isa lamang paraan para matulungan ang ating mga SMEs. Matapos matulungan ang mga SMEs sa design, product development. As you know, ang atin pong Pangulo, ang puso niya ay nasa malilit na negosyante. Inambisyon po natin na palakasin sila.
 
Ang for them to be empowered, it does not stop at giving them seminars. It has to continue with mentoring, with product development, marketing and branding. Financing as well with Pondo sa Pagbabago at Pag-asenso.
 
Aside from that, kailangang mabigyan ng market access ang mga produkto natin. And Go Lokal! is really a concept that will really give market access to SME products. And this time, these are not ordinary SME products. For them to be competitive, we always challenge them. Para ma-display ang produkto ninyo sa Go Lokal! kailangan napakaganda, bago. It has to be modern, innovate, yet still very Filipino ang treatment. Filipino-inspired set of products.
 
It will be curated bago po mabigyan ng pagkakataong masama sa Go Lokal! so that it becomes and incentive for them to continuously innovate. We’re happy to show the world, especially yung mga paalis. Napansin niyo, dati nasa DTI, tapos napunta sa mga malls (Robinson’s City Mall, Rustan’s), papalapit na tayo ng papalapit, ngayon nasa airport na. Susunod, lilipad na tayo kasi mapupunta na sa ibang countries ang Go Lokal!.
 
Kung naalala ko, sa France ata yung unang branch. I’m not kidding. Go Lokal! will also be set up in other countries, carrying of course the Go Lokal! Philippine brand. They are really modern but indigenous products.
 
Kaya natuwa po ako sa reaction ninyo, Mr. Huang, na medyo kakaiba yung ating mga produkto ngayon. Of course with young designers and artists: Common Room, ang mga designers sa Design Center of the Philippines. They’re helping us a lot to really upgrade the products that we have [for them to be] something that we can be proud of. Hindi na po ‘yan yung banig at mga bag nadikit sa damit ay nasisira yung damit.
 
Yung mga woven products give a different treatment to clothing. It becomes a modern accessory to clothing that everyone can and should buy. Hindi lang pang-costume party. Kundi pang-everyday wear with a touch of indigenous art.
 
And to our store partners; ang dalawa nating online partners, Shopinas and Marketa, retail stores, isa ring retail store na kasama Enchanted Kingdom, Thank you.
 
Go Lokal! now has 58 retail stores, 332 suppliers, 81 MSMEs (Micro, Small, and Medium Enterprises) in fact have been mainstreamed. Yan po ang isa pang goal ng DTI, to really mainstream MSME products. No longer limited to the weekend trade fair typo of activity on Friday-Saturday-Sunday at the top floor of a mall. We want them to be in the ground floor. Tulad po nito, where people converge.
 
So 81 mainstreamed and 1,000 products already developed. So we’ve had several support from product specialists, designers. And we counted also the rental spaces that they’re able to enjoy. Nakikita talaga natin yung malaking benepisyo sa MSMEs.
 
We’re told that it’s now a household brand, heavily shared on social media, #CertifiedLokalista, the hashtag of Go Lokal!, has become a byword among millennials, netizens, and other active social media users.
 
We are also in electronic billboards along EDSA. We’re also in PDI (Philippine Daily Inquirer), Philstar (Philippine Star), and the Mabuhay Magazine of the Philippine Airlines.
 
Go Lokal! continues to excite its buyers by introducing new products and fresh concepts for the Philippine Souvenir Industry. These were created by young entrepreneurs who are makers and artists as well. Recently launched at the Go Lokal! Concept Store last July 04, these entrepreneurs expressed their insights on Philippine culture through products with quirky stories. It is the millennials’ take on the Filipino lifestyle. Ito na po yung grupo ng Common Room. Now we’re launching it at Kiss and Fly Terminal 3. Salamat SSI for this partnership. And also to MIA (Manila Airport Authority).
 
As you know, the airport is an ideal captive market for Filipinos and foreigners who will be travelling abroad. Of course with SSI as a partner, makakaasa po tayo na madadala niya ang Go Lokal! to the next level.
 
With that, ito po yung sinasabi ko. May pop-up store na itatayo, sa Tokyo muna. Sa Japan Institute of Design, and in a way to test market the products. Of course, through CITEM, we joined a lot of fairs outside the country. Isa na nga dyan in France and other countries. Even in China as well, soon. Sa October we have CAEXPO. Sa November we have the China International Import Expo. So all these products will definitely reach other countries.
 
This is really an exciting afternoon for SMEs. Patuloy nating palakasin ang SMEs. Yan po ang sikreto sa poverty alleviation na suportadong suportado ng ating President Duterte. Dahil ito po talaga ang mag-aangat ng buhay ng ating mga kababayan. Maraming salamat po.

Keynote Address of Secretary Ramon M. Lopez, All-New Vios Ceremonial Roll-off (Under CARS Program), 19 July 2018

Keynote Address of Secretary Ramon M. Lopez
All-New Vios Ceremonial Roll-off (Under CARS Program)
July 19, 2018, Sta. Rosa Laguna

[Greetings]

Konichiwa. Ohaiyo Gozaimasu.

Makino-san; Moriyama-san; Mr. Rafael Villareal; our very good partner, the Congresswoman from the automotive capital of the Philippines, Madam Arlene Arcillas; Mayor Danilo Ramon Fernandez; the Vice Mayor as well; an icon in the automotive industry, Governor Alvarez; Honorable Constancia Gomez; the TMP (Toyota Motors Philippines) President, Suzuki-san; and of course, a very good friend, the Vice Chairman Mr. Alfred Ty.

Again, good morning everyone. Sa mga kasama natin dito sa TMP, magandang umaga sa ating lahat. Thank and congratulations to Toyota Motors.

[Introduction]

Thank you, Toyota Motors, for inviting me today for the ceremonial roll-out of your Vios FMC. As we celebrate the launch of your Vios, I would also like to offer congratulations in advance for your upcoming 30th anniversary.

Today’s roll-out of the Vios FMC serves as a major milestone in the ongoing collaboration between the government and Toyota. This is because the Vios FMC is the enrolled model in the Comprehensive Automotive Resurgence Strategy (CARS) Program, and marks Toyota’s commitment as Participating Car Maker (PCM) in the program.

I’d like to acknowledge the presence of the guys behind the CARS Program, Governor Henry of BOI, Mr. Mulong, and Ms. Concepcion. Please stand to be recognized, so they know who to approach when they’re ready to collect.

With the roll-out of the Vios, we will not only help jumpstart the local automotive industry but also generate more jobs and income opportunities for our countrymen.

[Implementing CARS]

The Duterte administration is committed in its support to revitalize the Philippine automotive industry. In this regard, the Department of Trade and Industry (DTI) instituted the CARS program to create more jobs, more income opportunities, and really create a more vibrant SME (Small and Medium Enterpise) community through the localization agenda which is part of the CARS program.

The overall goal of this program is to make the Philippines into a regional automotive manufacturing hub. We can do this by helping the local automotive industry level up against CBUs (or Complete Built Up units) being imported into the country. Currently, the target of the CARS Program is to achieve a 50% localization based on Bill of Materials (BOM) of program-enrolled models.

That level is the minimum. We hope that you can achieve more than 50% localization. Greater localization creates greater opportunities for SME suppliers in the country and it will create more jobs. As you know, our passion in the DTI is really to create higher value adding SMEs in the country.

This program will also augment and enhance policy directions of existing motor vehicle programs to ensure greater innovation, technology transfer, environmental protection, and the development of SMEs. These directions are aligned as well with our goal to grow and develop globally competitive and innovative industries under DTI’s Inclusive, Innovation-led, Industrial Strategy (i³s).

In fact, in Sta. Rosa, Congresswoman, Mayor, we have identified this area as an Inclusive Innovation Hub. That means we will be linking the industry with the academe so that there will be greater interaction between the needs of the industries and allow them to gain access of the research and development facilities of the academe.

In doing that, we are in effect, enhancing the relevance of the research being done in the universities; making sure that their research works will be solutions to industry problems and not just research for research purposes.

[Rebuilding Industries]

The CARS Program is at the heart of our Manufacturing Resurgence Program (MRP). We’re really happy to note that manufacturing has picked up, thanks to you, our partners in the manufacturing sector.

This sector has been leading the way in economic growth, GDP development of 6.8% in the first quarter of this year and 6.7% in the last year. The manufacturing industry grew more than that with an 8% growth, last year and the first quarter of this year. That 8% came from 3-4% in the previous years. That’s the kind of economic growth that we’d like to have, because it’s through manufacturing that we can create more jobs, more decent jobs.

This MRP is really a priority of the Duterte administration. Our President has a soft heart for the ordinary Filipinos. He simply wants the Filipinos lives to be comfortable, to uplift the quality of their lives, making sure that they have jobs, business, and kabuhayan.

That’s why in DTI, we have a straight forward program called TNK—Trabaho (Jobs), Negosyo (Businesses), Kabuhayan (Livelihood). We added another K—Konsyumer (Consumer) to make sure that our products are standard-compliant and prices are very reasonable. So we make sure also that our car prices are very reasonable.

With the support of the 2017 Investment Priorities Plan (IPP), the MRP will close the gaps in industry supply chains, provide access to raw materials, and expand domestic markets and exports for local manufactured products.

The goal of MRP is to enhance the competitiveness of domestic manufacturing industries. When we say enhancing competitiveness, we want to make sure that the raw materials have lower tariff rates than the finished products. That is one assurance that we would like to bring forward.

These industries can then be integrated in higher value-added, ASEAN-based production networks, and global value chains. The program will help us contribute 30% of total value-added and 15% of total employment by 2030. I’m happy to learn that the employment is close to 3,000 people. Palakpakan natin ang Toyota Motor Philippines. Of course if you ask us, we want to see it at the 10,000 level. Para yung mga kaibigan nila, magkaka-trabaho pa dito sa Toyota. In English, so that their friends can also work here in Toyota.

I’d like to reiterate that the government is focusing on Manufacturing to generate jobs not only for skilled workers but also for semi- and low-skilled workers. The target in localization will definitely help with that by promoting SMEs. This program will allow the movement of our workers from the informal to the formal sector, as well as from low value-added activities to high-value added activities.

I understand that the automotive industries are facing challenges. Of course I’m only referring the first six months of this year. For those who were trying to catch up with the tax reform program, more people were buying cars, especially the Fortuners. The Philippines is the largest market for SUVs in the region. The Philippines is also the largest market for Fortuners.

We are facing challenges this year, but definitely, the macroeconomic levels, 106 million Filipinos with an average age of 23 years, lower unemployment rate of 5.5% coming from 6.6%, definitely it spells more sustainable growth in the future. Young Filipinos with higher income, growing middle class can only mean one thing: more car sales in the future. After more spending on eating out, as the economy grows, the next thing is buying cars, the next thing is buying houses.

With such great demographics, we will have a very good run of car sales in the Philippines in the medium-term and in the long-term. It is also projected that our country will have one of the biggest economies—top 20—in less than 20 years.

Our credit rating has even improved. Our credit rating is very important, it tells the interest attached to any loan, not only government loans but even corporate loans. Our rating has improved from stable to positive.

[Gov’t Commitment to the Auto Industry]

We are currently implementing an ongoing review to make the Motor Vehicle Development Program (MVDP) more relevant in today's regional and local market environment—and the program’s incentives more appropriate. We also want to point out that the MVDP 2.0 will incentivize scale in local production based on a technology roadmap that is being developed.

We also hope that the government’s ongoing initiatives will translate to the lateral production of Toyota’s already-dominant models currently imported as CBU.

Of course, we would like to encourage Toyota to be part of the Public Utility Vehicle Modernization Program. We would welcome a different platform, chassis, engine size, and configuration, that is compliant to the PUV modernization program.

[Conclusion]

Two years down the road, we are now seeing the fruits of all our efforts with the Toyota Vios as one of the first Philippine-made cars to be built under the CARS program.

I am hopeful that with this roll-out, we can envision a future in which our countrymen can enjoy a stable income, secure employment, and a better quality of life thanks to a booming domestic automotive industry.

This is in line with our President’s 10-point Socioeconomic Agenda, where he promised a government that would widen the gains of economic development, to address inequality, and to uplift the quality of life of our countrymen.

That’s why I want to express our appreciation to Toyota for their continued confidence to invest in our country, which serves as testament to the Philippines as a preferred global investment destination. We also value your continued support in helping the government develop the Philippine automotive industry into becoming a regional hub. In fact, my request is to make the Philippines the manufacturing hub of your Vios, not only in the country, but worldwide.

Thank you and mabuhay kayong lahat.

Speech of Secretary Ramon M. Lopez, Franchise Asia Philippines 2018, 18 July 2018

Speech of Secretary Ramon M. Lopez
Franchise Asia Philippines 2018
18 July 2018

[Acknowledgements]

Ladies and gentlemen, good afternoon!

So, let me begin by, of course thanking the PFamily that is spelled PFA-mily, for inviting me once again as you know I have been here every year, no absence, I make sure I attend if you invite me. And I make sure that I am always here and avoid foreign trips because we always avoid foreign trips nowadays. And of course, I would like to congratulate the PFA family for really bringing to a higher level the franchise discipline, the franchise community here in the country. And it is now referred to as the “Franchise Hub in Asia”. So a lot of big learnings, [and] every year is always a record to be here, in terms of attendees, and you always call it I think it’s a bigger number of attendees this year. There’s a lot of business matching, networking, and I’m also pleased to know that you have now this Asian Institute of CFE, Certified Franchise Executive. I am very happy to learn that it is really on different level. So congratulations, once again.

Next week, Monday, would be our president’s day for the State of the Nation Address. And definitely, our president would be giving a lot of accomplishment. Some of those have been detailed out in the weekly SONA, in the State of the Nation Address Forum. One of the stories includes inclusivity and shared prosperity for our countrymen and this is really a part of 10-point socio-economic agenda of our president.

And you know, we are happy to always say that your franchising group, or your franchise community is a big partner in this endeavor. Our president, his particular attention is to give support for the franchise, especially the PFA group because you provide investment, you provide jobs for our people and to our president, what is close to his heart is really to uplift the lives of the Filipinos. To make their lives more comfortable and now you do that. Of course there are employment opportunities.

And I guess with that heart, you can say that it’s good to always refresh ourselves with numbers that gives a good scenario for our economy, the state of our economy. In 2017, with 6.7% going into the first quarter of 2018, we sustained that and we have had higher increase of 6.8%. And the different story is now that 6.8% is stacked up by solid sectors. Foremost among these would be sector is the Manufacturing sector that used to be at the 3% growth is now leading with 8%. Services continued to be at the high rate of 6.7% in other words, the one sector, recovers the other sector who will choose to be the running force in the economy which is the service center, and this is where the retail services is part of, continues to show a very good rate. And the other sector, the Agriculture which is used to be in the negative territory, is now in the positive territory, gaining 3.5% last year and 1.5% in the first quarter of this year.

The Philippines, among our peers in Asia, our country’s growth rate makes it the third fastest growing economy after China and India. This confirms with our country’s standing as one of the best performing economies in the region. The IMF (International Monetary Fund) latest world Economic Outlook database noted that our economy is the 39th largest economy in the world, 15th in Asia, and 5th in ASEAN. And as one of the emerging markets, our economy is the 6th richest in Southeast Asia by GDP per capita values. And you see, these per capita numbers are also increasing, suggesting also a growing economy and of course growing little fast to be specific.

With this, really experience a get-to-feel growing economy. We can sense that from all your branches. I am sure many of you growing double digit in the revenues. Tama ba? I heard some of you guys are earning 20% on the revenues. And this also shows that as the economy grows, there are a lot of people picking out. I have been receiving criticisms as I made that statement a couple of days ago. They said that it’s funny that I connect picking out with economy growth but that’s the reality. We go to a more developed economies and you see a lot of people in and out and it was less of this occurrence, in our earlier years when our economy was not growing this fast. And just to back it up with data and that statement is of course, based on some data, the statistics shows if you look at the GDP there is this personal consumption expenditure line and that’s broken down into the different sectors that boxed out the PCE or the personal consumption expenditure. One sector there will be the restaurants and basically the eating out. And it’s been growing the high single digit ranging from 7-10%. The last number showed 8%. So it shows 8% is higher than the overall GDP growth of 6.8%, so it means it is higher than the average growth that we have. It shows that there are more and more people eating out. Those who used to used to on a regular basis eats at home, will find it easier eat in a fast food area. Fast-food restaurant. And those eating the fast-food restaurant will eventually level up, upgrade take up to a maybe a casual dine in, and those in the casual dine-in will probably now be eating in the eat-all you can type restaurants and so on and so forth until they move on to the fine dining, and that’s the reality.

You see, greater number of Filipinos really taking up, even in the goods. You know, the mass rates goods, the FMCG. I was in that industry for the longest time and you can see people also taking up so you have cheaper brands or mass based brands and people taking up to more expensive and more premium brand along the way. So that’s the way it is. That’s the reality. So I guess, the critics should look at the numbers and you know, it will be explained to them that there is basis to these statements.

More on the economic growth, ADB (Asian Development Bank) reported that the Philippines is now experiencing the “Golden Age of Growth”, a period of high and sustained economic growth. They further said our domestic demand and our infrastructure program will fuel growth for the next few years, projecting our economy to grow by 6.8% and even higher than that for 2019.

PricewaterhouseCoopers (PwC) projected that the Philippines will become the 24th biggest economy. So in an earlier report, I mentioned about the number 50 something and now going to about 24th biggest economy in the world by 2030, and the 19th by 2050. So a lot of good indication, in fact, just this afternoon, on the way here, we got the latest rating. And we’ve just been giving us a stable outlook and they retain that stable outlook. So that’s good news. Of course, a few months ago, SMP leveled up our penetrative from stable to positive. And acronym over there is SMP. So that’s not the meaning of SMP, from stable to being positive These are the good indicators that we’re doing the right things, the reforms are there, they are being recognized they are and the good growth. There are some issues I know about inflation but they see this is as temporary issue part of growing economy, that the inflation that we were hitting now is of course trigged by external factors. And no attribution, and if ever, a minimal attribution to the recent reforms we are doing specifically the tax reform, more commonly known as TRAIN.

The positive outlook of our country can also be seen in terms of investments. You know, FDI (Foreign Direct Investments) inflows continue to register good numbers, should we say record numbers. From about 7.9B USD in 2016 to 10.2B USD last year in FDI. Moving into the first quarter of this year, there is also a 43% growth in FDI, that’s foreign direct investment [rather] the actual investment remittance to the country.

For our Board of Investments also, we have set a 50-year record since Board of Investments was established. Last year, we exceed 600B PHP, that’s better. And this year, January to May, we hit 19% growth. And if you look at January to June, I don’t want to specify the report but it is closer to about 28% growth. We are seeing a higher and faster growth for even to January to June of this year.

This growth can be attributed to the country’s sound macroeconomic fundamentals, solid optimism, business confidence, consumer confidence and many other things. And of course, part of this is also attributed to what we call priming activity and this can be seen in Build, Build, Build wherein the government is committed and it is already starting with the infrastructure development program that allocates 5% growing up to 7% of GDP for infrastructure development. And this has never been seen before. We have been under spending in infrastructure. We have been spending only 1-2% in the past decades. And that’s the reason why we have to catch up in terms of investing in infrastructure. And there are 75 infrastructure projects approved in the pipeline and over 35 have been approved and have started the process of bidding. This program will enhance the country’s investment, environment and competitiveness as we build infrastructure in over the logistic costs and of course it can create more employment for those workers that will be part of the Build, Build, Build program. And again, giving them employment will add more Peso in the economy, in the system. And with low rate of this cost. Basically we’re helping in the competitiveness of the country.

Meanwhile, our department with the other agencies, specifically Department of Finance (DOF) as we work on TRAIN 2. And to us, the tax reform part two is also an important ingredient in this tax reform. Never have you seen DTI and DOF working closely in the past administration and every time, they talk about incentives. One thing I must clear with all of you is that the tax reform part two that we are having does not talk about the removing the fiscal incentives for those that are in different areas of activity. That’s the reason why DTI has been supporting this. In fact, the incentives will be enhanced from what is limited to an income tax holiday incentive, there will be other incentives more relevant to many start-up sectors or start-up businesses that will be registered. It will now include even accelerated differentiation, will include net loss carrying over or even double deduction on your currently and daily expense. All of these incentives can be enjoyed by firms that were pre-registered.

Of course, part of this, is also counting the number of years that wanted to be on incentives. We basically rationalize what is now being given as perpetual settle incentives like corporate tax rate. For example, in the Philippine eco-zones registered in PEZA, but no other countries given in any way the perpetual incentives. There has to be rules and we have agreed with that principle. Being economies by training, it makes sense to have all these limited number of incentive. Because of the other side of the picture, as you rationalize the incentive, more sectors, more companies will enjoy because those are registered will now enjoy lowering of the corporate income tax rate. ‘yun ng kapalit po noon. Rationalize this part so we can have general lowering. There is much companies in that side defense. From 30%, the tax rate for corporation will now make a bigger account to 25%. There is always a trade off, but it’s more of leveling the trade, and making incentives more relevant with more performance-based time count and focus. The law will make sure business support mechanisms will be definitely more performance-based, and will benefit companies that are really putting in more investments and creating more jobs. Instead of a continuing set of incentives even though the companies are no longer in the investing or adding employment, that is the rationalization being done.

Let me now go on to another development that will benefit your sector and that is with reference of the Ease of Doing Business (EODB). Recently, the president signed Republic Act 11032 that assures and works on Ease of Doing Business. The highlights of this will be in all your transactions in the government. In applications, permits, anything that would be in line with the fault line services of government can now be a limited passing number of processing time. Three days for simple transactions, seven days for complex and 20 days for highly technical transactions. So if you have experiencing problems in getting permits whether at the national government agency or typically will experience that also in LGUs (Local Government) getting Mayor’s permit and other permits. I guess those days are quote-unquote numbered. And they are numbered also because in this law, it is a harsh law actually. It is a two-strike policy. The first strike the first offense there will be a six-month suspension of the employee’s concern. The second offense is termination, forfeiture of benefits, penalty or fine of 1-6M PHP and six months of imprisonment. It is a criminal act. So it is really a difficult law or a harsh law. Of course, we kid around,baka wala nalang matirang trabahador sa gobyerno or marami nang mag-resign. O baka first offense, ‘mag-resign na ako baka ma-hit ko ‘yung second offense’’. But that’s really a challenging and difficult law but it is written to install disciple into the system. That act covers having a Citizen’s Charter wherein all the requirements will now be listed. So that the government agency cannot tell you after submitting all the requirements, ‘eh, you still lack of one requirement. You need another document. Submit this’ and everytime you back and another document lacking. They will keep you coming back and of course, in the end, maybe they are just waiting form of corruption. That is the difficult part. Now it will be listed in the website of the Citizen’s Charter, all the documents will be there and there will be no reason for the office, the government office to reject your application. In other words, they have to accept that and process it within the prescribed number of days. Hindi na pwede yung pag-submit mo, may kulang pa rin pababalikin ka, may kulang pa pababalikin ka.

So, the IRR is now being drafted by, I think October [because] that’s 90 days since signing. The IRR will be finished and the concentrations are now being undertaken. Then today, is just the beginning. Basically, they want to see a one form type of application so what we are doing now is making an inventory and put out of all forms needed by SCC, BIR, the mayor’s permit, the construction permit and hopefully, will do that in one form. Submit that, fill it out online, submit it, and in a few minutes you get assessed, you pay via PayPal or PayMaya or whatever payment system and you get to print the business permit. Just give us a few months, hopefully before the end of the Duterte Administration I will promise you that this is something that we will deliver, an online registration system that will give you the processing within minutes. And we are now actually having a design, actually a design workshop. It’s like in the business sector, we have the zero case budgeting assuming there is no form to fill out. If you will give me a form that will just list down all the information field you could give and that settled information field is the one will be needed by these different offices. Fill it out, be accessed, pay and then approve. That’s the ultimate goal. That’s the new mindset that we are seeing. To talk about mindset, that is the mindset we are receiving also as in the EODB. It has to be a leaping type of mindset that will allow us from where we are now to hopefully the top 20% in the competitiveness index because our source has been improving yearly. Even last year, we have improved our score. But the other countries improved much more that is the reason why our dropped last year. So everybody’s improving. We have to improve much faster than them that is why we have to leap forward. And by leaping we have to infuse it in your system.

Just a government direction, in terms of industry development, in summary, we were working also on Inclusive, Innovative, Industrialization Strategy or the I3 Strategy. It is only just ensuring that the industry sectors, including the franchise community which I know you are already into, because without innovation, you will never survive or even grow. Inclusive innovation, industrialization strategy is the one we must give into. And part of the ensuring an I3 Strategy, is indication of our industries will be competitive. And I must also tell you that there are policies that would affect competitiveness of industries. One is foreign exchange. I’ve often mentioned that foreign exchanged is schemed to building a big production base. A production base that will also lead us to a net exporting base, a net exporting country by having market based foreign exchange. It is important if the currencies are deprecating, don’t think of it really is a bad thing. It is really benefitting our economy because exports will be promoted if you protect the local, domestic industry, we will protect the manufacturing industry because the foreign exchange will be a natural protection to all the imports that are coming in. it will promote local manufacturing and build more export production base for us to be net exporter in the future. And for all of us, for you in the retail industry, it will prime out also the domestic economy, our OFW brothers and sisters will now have more Pesos for every dollar that they earn and even in the IDBP sector, and many other sectors that are dollar rating so there will be more money in the system and it will definitely prime the consumption steadily. Having a competitiveness exchange rate is not that bad. It is actually benefitting our country.

The other thing is that we also make sure, especially for you in the operations of retailing, as well as in the manufacturing, that your inputs, they are always be competitive in pricing so that you will also be competitive. And what do we mean by that? For example for inputs like sugar. And then we go into that particular item because has been increasing in prices nowadays and it is because the sugar production is not in very good this year and the bottom-line, you can see it also in the prices. The prices of sugar, locally, have been reaching 3,000 pesos per 50 kilogram pan. In the world market price, is less than half of that. Lumaki ‘yung gap. About 1,300 to 2,400, so all those manufacturing sugar user in the sector are at a disadvantage right now. So, what is the solution? The solution is to allow importation and the good thing is that the Department of Agriculture has actually allowed the importation of sugar. That is the good news. But the bad news of course is it has been limited to the sector, the planters, the miners, the takers. And why should it be limited in this sector? Why don’t we allow the sugar using industry to import their requirements so they could benefit from the lower cost input? So that their industry will be more competitive? So that’s an issue. And at the end of the today, if you add in all of these costs, additional fees on any sugar in partition, when it guess to the retail, even to the supermarkets, or to the palengke, ang mahal na ng sugar. You get sugar from 50 pesos close to 60 pesos or even more 65 esos per kilo. That is also a reason why some of the basic commodities, like sugar, prices have been really going up. So it is not good for the consumers, it is not good the manufacturing industry.

Let me go on to another issue. This is not an issue, but this time, is an opportunity. I’ve mentioned in my earlier talk I think it’s in the PRA or Philippine Retail about the opportunities in Halal. I understand some of the franchisors and brand owners are now opening up in other countries in Brunei, Malaysia, and other countries predominantly Muslims, Indonesia also. So in Halal industry, there is a huge opportunity there and we encourage you to top that market. and the good thing is that Halal opportunity really offers tremendous market size of 3.2T dollars and even locally, assuming a one percent of that world market size is just about 30M dollars so it is also huge number for the country alone. And this is not limited to food. It also covers personal care, cosmetics, also covers I think even clothes and even restaurants, hotels, resorts, and we need opportunities there. If we have those in our system, in our economy, we can imagine an influx of more tourists who are Muslims who really wanted to go to the Philippines but their problem is there are no restaurants to go to. Wala pa silang mapuntahang restaurant or resort or there are, konti lang. it’s just a few of them so it will be very important for us to look into this market. To build our Halal capability so that we can eventually also export and be part of a very big Halal market. And good thing with Halal, it has positive attributes attached to it. It is considered as a way of life it should be highly attached to a religion so we imply this positive. It’s pure, it’s clean. It’s permissive. Those are positive attributes attachment of Halal. Even Singapore that is not a Muslim dominated country, and I remember our special traders by then who is here but now based in China, brought a huge deal account grocery, a supermarket that selling only Halal. And Singapore is only about 10% of their population who are Muslims and yet they’re making it as a selling proposition already, a positioning for some retailers. We recognize also the potential in Halal.
Moving on, population and inflation, our country’s investment situation is also a perfect match with our country’s young population with average age of 23.1 years old. And now with lower unemployment rate from 6.6% to 5.5%, you can expect that for many more years, we will have sustainable growth in our consumer base. So again this is a positive indicator for our retailing and franchising group. I mentioned earlier the kind of growth we are having and in a way of happening with the lowering of tax rate for personal income tax, the increase in the number of Filipinos that will be covered by the exemption and therefore they will now have a higher take home. There is about I think 12M pesos added into the system. With the salaries from workers who are in the Build, Build, Build, with the savings from pre-education and tertiary education, health benefits and all that in total, the estimate is about 32B pesos added into the system per month. So imagine that this is really happening and to the certain extent somehow driving out the prices also. And that’s the reason why despite there is a 5.2% inflation rate, the latest SWS survey shows that the Filipinos, in general, are feeling extra rich, in other words, they have more money in their pockets or maybe in the statement there they feel less poor. Because I think that is the reason because they have more money in their pockets. I know this might attract more criticisms after this talk but that is the result of the survey. Don’t blame me. The higher take home pay will make one a bit richer. The estimate is if you have one month extra every year, it’s like a one month bonus every year. That’s the kind of tax saving you’re getting under the TRAIN 1. So higher take home pay. If you’re earning 50,000 per month, you have 50,000 extra income for a year because of savings. You earn 21,000 the same. 21,000 for the year.

And then let me just go to the MSME development just to highlight the point that the franchising group has been a partner in Micro SME development in entrepreneurship development. For so many years, we appreciate your vital role in Micro SME development and thank you for that. And many of you are mentoring, many of you are being mentors in the DTI program, SME teaching and seminars nationwide. Together with our other partners sa Go! Negosyo, Philippine Marketing Association, dahil po doon maraming salamat sa inyong pagtulong sa amin and as you know we now have about 890 negosyo centers and please fill out more the negosyo centers with mentors. Maraming tayong pwede gawing place nationwide. It’s almost one for every two municipalities already. And that number keeps on growing.

So in ASEAN region, Philippines has shown, it’s the best destination for international franchises with the latest number of 2,000 brands and about 200,000 franchise units as noted by the recent International Franchise Association Convention. The country ranks 7 and 8 globally in terms of the number of franchise brands and franchise units. So congratulations. Kayo ang “Franchise Hub of Asia”.

Our local brands have also crossed borders, and maybe even more with 20 brands penetrating Southeast Asia, Middle East, and North America. That’s why we like to thank everyone here today for their continued support in making the Philippines the “Franchise Hub of Asia” and actually we have here, I see in the room a lot of our commercial attachés consider DTI as your partner in bringing your brands abroad. Actually, prior to this convention, I think late last year when we have the planning, I could pass our team, Foreign Trade Service the commercial attachés and Special Trade Representative to mainstream Philippine brands. A lot of business development activities are happening. They contract many meetings but and today we want to measure that in terms of the number of brands that have been mainstreamed whether these are manufactured goods, so the local Philippine brands that would be in the grocery shelves or franchise Filipino brands that would definitely be in the mainstream market. Everytime we go to these countries, we are very happy to see PH brands in the malls or everywhere in the mainstream market in those countries. And what do I do everytime I see them? I take a selfie and I show and send it to you. I am sure many of you are doing that and I am proud to see Philippine brands abroad. So palakpakan natin ang mga Filipino brands that are reaching the world market.

Our foreign trade service will be your teammates. And everytime we were in abroad and would like to meet companies, franchisees that will be your potential partners abroad. Please make use of them. We will continue to do more investment roadshows inviting you to join us. I think September we have a plan to go London so that we can meet the investor community but at the same time we would like to invite you to join us present opportunities that you can offer them as well as meeting also the Filipino community there and the opportunities that you can offer to the Filipino community. Many of them I’m sure would like to assure to have their own businesses back home, either through their relatives or in preparation for their eventual return to the country. So we would like you to join us in London.

So let me conclude by saying that of course now is the perfect time to invest in the PH it is always perfect more today than yesterday. Diba parang kanta. Not as much as tomorrow. So, I’m sure our President, is your greatest supporter for two reasons: number one, for his better half, to Madame Honeylet Avaceña who owns many franchises and I know si Madame has been helping her as well and her team. Even before bago pa naging President si boss. And the second reason is again, was mentioned earlier, the franchises, your franchises create jobs that alleviate our need and make life more comfortable for the Filipinos. So, with that, we encourage you to join us in the nation building and just always stay with us as we bring the Philippines to become economic partner of the world.

Maraming salamat po at magandang gabi sa inyong lahat.

Speech of Secretary Ramon M. Lopez, Marawi Entrepreneurs' Forum & Job Fair, 16 July 2018

 
As-Delivered Speech of Secretary Ramon M. Lopez
Marawi Entrepreneurs’ Forum & Job Fair
16 July 2018, Mindanao State University, Marawi City
 
[Greetings]
 
As-Salaam-Alaikum. To our Mindanao State University President Dr. Habib Macaayong, our partners from the private sector, starting with PDRF, Al-Amanah Islamic Bank, our partners from USAID-Surge Project, Asec. Felix Castro of Task Force Bangon Marawi, our partners also from UNDP, ASA Philippines, East West Seed Co., Coca Cola/TESDA—which will provide more training especially to those who have sari-sari stores. Palalakihin po natin yan para maging groceries in the future.
 
Ang PCCI Marawi Chamber, ang DOLE at DSWD, sabi ni Usec. Gani Macatoman, we have companies who will provide job opportunities for all of you here. Ang ating DTI Family, led by Usec. Gani Macatoman, Asec. Nes Perez, Regional Director Lydia Boniao.
 
Magandang umaga po sa inyong lahat.
 
[Introduction]
 
This event is part of the Bangon Marawi project. Kagustuhan po ng ating Pangulong Rodrigo Roa Duterte na ipagpatuloy ang mga programa para makatulong sa ating mga kababayan dito po sa Marawi, lalo na ang mga biktima ng Marawi siege.
 
Sinisiguro po namin na makabangon ang mga negosyo, at least sa DTI, yan po ang pangunahin naming gawain sa Marawi Task Force. Nais po namin na maibalik ang mga trabaho at negosyo dito.
 
Ang DTI at Board of Investments ay naghahanap ng mga investors na magtatayo ng mga planta—mga manufacturing plant—at iba pang mga negosyo sa Marawi at mga karatig na lugar upang makapagbigay ng mas maraming trabaho sa lahat.
 
Ang DTI ay nag-partner din sa iba-ibang private sector groups, ang ilan dito ay nabanggit na rin kanina. Ito po ay bunsod ng mga konsultasyon sa mga civil organizations ng mga IDPs (Internally Displaced People). Nakipag-usap po kami sa mga IDP leaders para malaman kung ano ang inyong mga pangangailangan upang ito ang aming matutukan.
 
Ang Department of Trade and Industry rin ang namumuno sa Task Force Bangon Marawi Sub Committee on Business and Livelihood. At ang aming adhikain po sa DTI ay Trabaho, Negosyo, pati na rin Consumer protection. Binabantayan po namin ang standards at presyo ng mga produkto. Ang mga partners sa private sector ay kasama namin sa pagbibigay ng livelihood programs.
 
[Starter kits]
 
Ang DTI po ay mamimigay ngayon ng Php 15,000-worth ng starter kits para kayo ay makapagsimula ng inyong mga negosyo. Ito po ay hindi ipinamimigay ng cash, kundi mga gamit para sa nais niyong buksan na negosyo. Pwede itong sewing machines, mga paninda, o food stalls. Ang nais po ng ating Pangulo ay mabigyan kayo ng pag-asa at tunay na livelihood para umangat ang buhay ng lahat.
 
Since the start ng programa sa Bangon Marawi, ang ating Small Business Corporation ay namamahagi po ng mga Shariah-compliant na pautang. Ang kailangan lang po naming ay certification na kayo ay parte ng isang asosasyon o negosyo. Kunwari sa palengke, certification lang galling sa vendor’s association. Wala nang DTI registration na kailangan.
 
Ito ay para lang masigurado na ang umuutang ay nagnenegosyo at may pambayad. Hindi naman po pwedeng magpapautang lang ang gobyerno na hindi sigurado sa pagbibigyan.
 
Meron din po tayong pautang para mga pamilya ng mga kasundaluhang wounded- or killed-in-action (WIA/KIA). Dahil sila rin po ay naapektuhan ng giyera sa Marawi.
 
So far, mga mga 756 livelihood starter kits na naipamahagi sa mga beneficiaries:
 
295 sewing machines, 56 sewing kits, 213 starter cloths
20 karinderia starter kits
76 sari-sari store kits
20 carpentry tools
20 electrician tools
20 Maranao delicacies starter kits
20 street food business starter kits
11 bongo trucks
5 mobile rice mills
 
Sa 500 po na mabibigyan ngayon ng starter kit, tatanungin po naming kayo kung ano ang gusto ninyong starter kit. Bibigyan muna naming kayo ng starter kits, lahat po kayo ‘yon na nandito ngayon.
 
At magandang balita po, yung budget po natin sa livelihood sa Task Force Bangon Marawi ay naaprubahan na po ng gobyerno ni President Duterte, ng Department of Budget and Management. Kaya ang lakas din po ng loob naming na magpangako sa inyo dahil meron na po kaming ibibigay.
 
[Microfinancing]
 
Ito po ay grant, hindi po utang. Yung sinasabi ko pong utang ay iba pa yon. At bukod pa ito sa mga kasama nating kumpanya na magbibigay gamit ang kanilang mga programa. Ito po ay grants din. Pwede po itong training, seeds. May mga pautang din po sila yung isa po, hanggang Php 300,000, yung isa naman, hanggang Php 500,00.
 
Yung amin po hanggang Php 200,000, pero titignan po namin ang inyong pangangailangan at kakayahang magbayad. Hindi po magbibigay agad ng malaking halaga. Kapag maagap po kayong magbayad, pwede kayong manghiram nang manghiram ng mas malalaking halaga. Kaya mahalaga po na may track record kayo sa maagap na pagbabayad. Yung pagpapautang po, sumasabay sa paglago ng inyong negosyo.
 
Kailangan po masinop ang financial management para umunlad ang negosyo. Kaya confident kami na magpahiram sa mga Maranao dahil kayo ay kilala bilang magagaling sa negosyo. Palakpakan po ninyo ang inyong mga sarili.
 
[Market access]
 
Mahalaga din po na ang maganda at well-designed ang ating mga produkto. It should be quality at the right pricing. Kaya kami po sa DTI ay naglunsad din ng Bangon Marawi store sa DTI office sa ground floor. We provided a space there for a retail store, parang mga stores sa mall. Isinali din po natin ang mga produkto galing dito sa Go Lokal! na nasa mga malls tulad ng SM, Robinson’s, at City Mall. Lalo na po sa City Mall na may Go Lokal! outlets sa lahat ng branches.
 
Kapag pasado na ang inyong produkto, dadalhin po naming ito sa Go Lokal! sa mga malls nang walang bayad. Sa mga malls, may mga renta at listing fee para makapag-display ng mga produkto. Wala na pong ganyan sa Go Lokal!
 
Pati na rin po sa mga OTOP o One Town One Product stores sa mga pasalubong centers. Nagbago na po ang branding at naging OTOP Philippines Hub. Napakaraming programa po ng DTI para sa inyo. Mula sa product development, equipment, at market access.
 
Meron din po tayo ngayong job fair ka-partner ang DOLE at TESDA at iba pang mga partners na nabanggit na kanina.
 
[Medical mission]
 
Before I end, meron din pong programa ang mga asawa ng Gabinete, mga Cabinet spouses, ngayon. May medical mission po sila. Kasama po nila ang mga surgeons na galing sa Pilipinas at ibang bansa na naglaan ng kanilang oras para sa mga major surgeries. Nandito po sila hanggang Wednesday. Kaya po kung hindi niyo pa narinig, iniimbitahan po namin ang mga may problema sa kalusugan na makipag-ugnayan na lang sa aming Regional Director para maimbita po kayo.
 
[Closing]
 
Nagpapasalamat po kami sa mga nag-organisa nito, sa Task Force Bangon Marawi. Lalo na at nangako ang ating Presidente na hindi kayo iiwan. Sisiguraduhin po naming na tumulong sa inyong kabuhayan. Ang gobyerno po at committed sa ating vision para sa mga naapektuhan ng Marawi siege na maging komportable ang buhay ninyong lahat. 
 
Maraming salamat at magandang umaga.

 

Keynote Speech of Secretary Ramon M. Lopez, National MSME Summit 2018 (10 July 2018)

Speech of Secretary Ramon M. Lopez, Launch of Go Lokal! Souvenir Collection (4 July 2018)

Speech of Secretary Ramon M. Lopez
The launch of Go Lokal! Souvenir Collection
4 July 2018, DTI Main Building, Makati

“DTI Go Lokal!: Supporting Young Makers and Artists”

Good Afternoon, everyone. It is another exciting afternoon for the Go Lokal! project. First of all, I would like to thank all of you, I’m pleasantly surprised to see you here and I really appreciate your presence.

Go Lokal! really started with a simple vision: to mainstream the Micro Small and Medium Enterprise (MSME) products.
Every time MSMEs want to enter a mainstream market (malls), they have to pay a listing fee of two to three million pesos, or rent space. But with Go Lokal!, in cooperation with many of the retailers here in the country, we do our share in helping the MSMEs gain free access to the mainstream market.

The beauty of this is that they get to be discovered in Go Lokal! stores. And when people [from these] bigger companies, discover that, “Oh, you’re a part of Go Lokal!? Then I will waive my listing fee.” They can now enter the mainstream market, and it will bring no cost if any, a very minimal cost for Micro SMEs.

This really promotes and encourages more and more MSMEs because the incentive for improving their products is they gain access here. So this really promotes and incentivizes MSMEs to continuously innovate on their products.

The good news here is that our Go Lokal! store started from one in Robinsons to around 50 now with 315 MSME suppliers, 81 MSMEs mainstreamed, and 600 products in malls and supermarkets. Ganoon na kadami, and we just started middle or late last year.

We are very happy that we have come this far and hopefully this is just the beginning. Ibig sabihin ng beginning, nowhere to go but up. We expect this to really go up.

We will also be in Kiss and Fly in NAIA 3, that will be launched this month, July 19. Ang daming development. We are in PAL Mabuhay Miles Magazine, we now have LED billboards along EDSA, in partnership with MMDA, we are covered by Philippine Star, Inquirer, some magazines as well.

But, you know, this project is not really for us. It is really for the MSMEs. And this is really the priority sector of our President Duterte. This is our way to really make sure that we always uphold inclusive growth. And by empowering MSMEs, you empower the nation.

They’re not just simple MSMEs now, they are more empowered, smarter entrepreneurs with products that have better design and packaging. These will become higher value products. And that is changing their lives. We want the micro to become small, small to become medium, and eventually the large. That’s the overall concept.

For all those participants and suppliers of Go Lokal!, I know that next challenge is when they get to discover the people order or the buyers will order in volume. So the next challenge is “Oh, support na. Wala na kaming pang-increase ng production.

Now don’t worry, because we have the Pondo sa Pagbabago at Pag-asenso we have the financing source for you. What we are working now is expanding their operation using Pondo sa Pag-babago at Pag-asenso—that’s President Duterte’s idea to battle and replace the 5-6.

You don’t have to borrow from 5-6 and the nicer story also is if you get bigger, and you borrow bigger amount, higher than 200,000 pesos, we can let our SB Corporation lend to you directly. So you are categorized as a medium scale producer and you will get access into lower interest rate fund.

Hindi na s’ya microfinancing rate. Kasi microfinancing rate, they are still in 20% per annum. Kasi ano ‘yan, higher operating cost, and a lot of people to disperse and collect, so 20% is a typical interest but if you’re in that medium-sized loan already, you can get it at about 7 or 8% per annum.

All of these are per annum; compare it to 20% per day or 20% per month of the 5-6. In the DTI, we try to provide the 360-degree support in market access, finance, equipment, training, and many more.

So, once again, thank you for joining us. This is hopefully our way to really keep better chances to our Micro SMEs up their lives and to become more prosperous Filipinos and as our President says, more comfortable life for all of you. Salamat po.

END

 

Speech of Secretary Ramon M. Lopez, Philippine Retailers Association General Membership Meeting (28 June 2018)

Welcome Remarks of Secretary Ramon M. Lopez, US-ASEAN BUSINESS COUNCIL SME WORKSHOP (27 June 2018, Philippine Trade Training Center)

Welcome Remarks of Secretary Ramon M. Lopez
US-ASEAN BUSINESS COUNCIL SME WORKSHOP
27 June 2018, Philippine Trade Training Center
“Empowering Philippine SMEs with Digital Tools and Mentorship Opportunities”

First to our Ambassador Sung Kim of the U.S. Government, our partner in SME development, PCCI President Alegria S. Limjoco, Senior Representative of the US-ABC, Elizabeth Magsaysay, Mr. Surendran Vangadasalma of Cisco, and our partners from the government, a gracious welcome to all of you.

Ladies and gentlemen, it’s my pleasure to be with you this morning. Today, we celebrate the International Day for Micro, Small, and Medium Enterprises (MSMEs). This is in support of the United Nations (UN) General Assembly resolution recognizing the crucial role that MSMEs play in achieving the 2030 Agenda for Sustainable Development.

Empowering PH MSMEs

Last year, the Philippines’ MSME Development Council also acknowledged the UN designating June 27 of each year as “Micro, Small and Medium Enterprises’ Day.” This resolution highlights the importance of MSMEs as the cornerstone of economic growth and development of the country.

Here in the Philippines, we pay special attention to MSMEs. This is a sector close to my heart and the heart of President Rodrigo Roa Duterte. He has given us the mandate to cater to the needs of the Micro SME sector. He has given us a lot of support in terms of budget, manpower, resources, etc.

Another achievement on SMEs: This year we have decided to convert the Philippine Trade Training Center, an attached agency of the Department of Trade and Industry, into an MSME Academy. The PTTC was originally created for Philippine exporters—for them to level up. By transforming this into an SME Academy, we are preparing MSMEs to become part of, first the local value chain, and eventually the global value chain.

MSMEs account for 99.6 percent of the total number of businesses in the country, while also employing 62.8 percent of the total workforce. The challenge has always been, the value adding part—they account for only about 36.5% of GDP. The answer, of course, is in the capacity of the MSMEs. The drive for us is to help them become smarter entrepreneurs who will contribute a higher value added to the economy. If we’re talking of inclusive growth, we have to empower the MSMEs or those at the bottom of the pyramid. We want the micro to become small, the small to become medium, and the medium to become large enterprises. In developed countries, the MSMEs account for 50 – 55% of the GDP. That is our target.

To this effect, we must continue to effectively empower these main drivers of national development by ensuring that in today’s changing landscape, no one will be left behind—especially under President Rodrigo Duterte’s administration.

It can be hard to keep up with the rapid developments in the 21st century, especially with the changes arising from the 4th Industrial Revolution. But with the Internet of Things, MSMEs have the potential to gain from the digital revolution with technology acting as enablers to help them hurdle market barriers towards growth and expansion. Technology is the great equalizer. We want MSMEs to have access to more information on market trends, designs of products, business models, etc.

Taking advantage of the ASEAN Economic Community, the Philippines must embrace the digital economy and the innovation processes. It’s also imperative for our MSMEs to connect to overseas market, compete worldwide, and be connected to regional and global value chains.

Fortunately, there is a multiplicity of digital platforms that can hasten enterprise owners to reach buyers of its goods and services online. Aside from this, we are also talking of online mentoring. We already have mentoring programs, we just need to take them online so they can train more MSMEs. We want to give them access to mentoring 24/7.

We have 883 Negosyo Centers nationwide. Anyone can go to these centers and ask the business counselor about our microfinancing solution, the Pondo sa Pagbabago at Pag-asenso or P3. This is our program to replace the 5-6 lenders. 

Increasing MSME connectivity

Public-private initiatives have already begun to support MSMEs in this area. Early this year, the Department of Trade and Industry (DTI) partnered with Google Philippines and IPG Mediabrands Philippines, Inc. to increase MSMEs’ presence on digital platforms. This effort will make them more dynamic and competitive: for example, Google My Business can enhance the online visibility and accessibility of MSMEs to potential customers.

We also teamed up with PLDT Enterprise for an event teaching entrepreneurs about digital tools like PLDT’s PayMaya, a prepaid online payment application that permits customers to pay online without a credit card.

Across the Asia-Pacific region, the Philippines is likewise one of the proponents of the B2B online platform, the APEC MSME Marketplace. It is a great trade opportunity in the trend of the digital economy that addresses issues of doing business beyond our borders using the internet.

However, the increase of connectivity through digitalization compels businesses to build capacity and engender innovation. This is important to consider as they begin catering to buyers with higher requirements, and markets with higher product standards.

To facilitate MSMEs capturing this digital opportunity, we need to make smarter entrepreneurs. The programs that we outlined for MSMEs cover the 7Ms of entrepreneurship: Mindset, Mastery, Mentoring, Money, Machines, Market Access, and Models of Negosyo.

We provide market access not only for three-day trade fairs. We set up Go Lokal! stores for MSMEs to have free access to mainstream markets—these are the malls. We only accept MSMEs with beautiful products, so this becomes a challenge for them to deserve to be displayed and be discovered in the Go Lokal! stores. Otherwise, an MSME in this country would have to pay around PHP 2 million just to be displayed in the groceries.

This 7Ms approach is our 360-degree intervention for MSME development.

The ASEAN SME Academy

The ASEAN SME Academy, which is also highlighted today, is an online platform that provides business information and training resources to Southeast Asian MSMEs and utilizes Mastery and Mentoring strategies.

The Academy’s ceremonial handover occurred last year in Luang Prabang, Lao PDR, between the US-ASEAN Connectivity through Trade and Investment (or US-ACTI), and the ASEAN Coordinating Committee on MSME through the Philippines.

The Academy plays an important role in the realization of the Plan’s strategic goal on enhanced management and labor capacities. As of May 2018, it was recorded that 31% (or 1,058) of the total number of active users (3,340) of the Academy are Philippine enterprises. Two of the five most popular courses are on online tools such as “Boost Your Business with Facebook” and “Social Media Marketing.”

Conclusion

It’s not surprising that the entrepreneurship ecosystem calls for new business models. Reinforced by the 4thIndustrial Revolution, MSMEs cannot strive for more of the same. That’s why this year’s National MSME Summit with the theme “Accelerating 7Ms for Developing MSMEs 4.0” will emphasize these issues. This will ensure that MSMEs will be connected and not mere observers during this transition.

Let me take this opportunity to invite all of you to on July 10 at Clark for the National MSME Summit. Director Jerry Clavesillas will make a detailed announcement regarding this. So far, we have President Duterte attending the afternoon session.

Today, I call on the audience to prepare to be challenged, inspired, and empowered. MSMEs should also be mindful that there are corresponding responsibilities in using digital tools, as well as going digital.

Lastly, I wish you a most fruitful day as we exchange knowledge on fostering MSME competitiveness through mentorship and equipping you with appropriate digital tools. Let us remember that our efforts are aimed for the greater good of creating inclusive growth and shared prosperity for all our countrymen.

Thank you and mabuhay kayong lahat!

END

Opening Statement of Secretary Ramon M. Lopez on TRAIN Package 2

Message of Secretary Ramon M. Lopez, DBP and DTI Memorandum of Agreement Signing (14 June 2018, DBP, Makati City)

Speech of Secretary Ramon M. Lopez, 2018 EODB Report to the People at the 6th Ease of Doing Business Summit (13 June 2018, Philippine International Convention Center, Pasay City)

Speech of Secretary Ramon M. Lopez, 2018 Philippine Semiconductor and Electronics Convention and Exhibition (13 June 2018, SMX Convention Center, Pasay City)

MESSAGE OF SECRETARY RAMON M. LOPEZ

2018 PHILIPPINE SEMICONDUCTOR AND ELECTRONICS

CONVENTION AND EXHIBITION

13 June 2018, SMX Convention Center, Pasay City

Our good Secretary Boy dela Peña will be speaking in behalf of the President and will be delivering the keynote. So I told myself that I will be limiting myself to expressing our deepest gratitude and thanks to the SEIPI group—the semiconductors and electronics industry, which as we know is a big driver of the economy.

A big thank you for really helping us develop the PATHS, the Product and Technology Holistic Strategy, which is really the industry roadmap. We are really interested in working the out, of course with SEIPI (Semiconductor and Electronics Industries of the Philippines, Foundation, Inc) and the authority among all the Cabinets, the Department of Science and Technology (DOST). We’re fortunate to have with us Secretary dela Peña who has helped us a lot in the roadmap.

As we know, your industry accounts for a significant contribution to our economy. On exports, you account for 50% and you still do. And you still are performing above par and it’s good that that over 50% performs positively to the tune of 5 – 6%, I think, the latest figure.

I know that you can grow more, with the new products that you develop, higher value, new designs, market-driven products that you will be churning out from your group.

On the GDP, I understand that you also account for more than 10%--especially on that manufacturing sector, which is really a good story to tell nowadays, as we experience that 6.8-6.9% GDP growth.

We are all bragging about the fast growth of manufacturing leading the way at 8% growth rate—which is quite above average and a really far cry from what we are hitting two or three years ago, at a level of above 3%.

Your sector accounts for about 3 million in terms of employment. As you know President Duterte’s administration is not only about projecting and promoting innovative and inclusive industries, it’s really about creating jobs: jobs that will uplift the lives of our countrymen, jobs that will eradicate poverty.

We really bank on this sector because you are the future. You are helping us in the past, but you are still the future because you are the source of these new innovations and technology. 

Again I would like to thank SEIPI and DOST for the completion of the PATHS project. Also thanks to the DOST PCIERD for their support in the completion of the PATHS project

The PATHS will steer the technological direction of the Philippine industry towards becoming an innovation-led industry, which is also strategy of the Department of Trade and Industry.

This project was funded by DTI-BOI amounting to Php 2.85 million and implemented by DOST-PCIEERD through SEIPI

Our long term vision is for the industry to generate US$ 5 billion investments, US$ 50 billion exports, and 13.5 million direct and indirect employment.

The PATHS will identify emerging products and technology in the next five years and identify the right conditions to create an environment conducive to the transfer of new technologies to the Philippines, the shift to higher-value manufacturing, and optimum socio-economic environment to sustain growth of the industry.

This is where we really would like to work closely with your sector. I know that there are a lot of concerns. But we really want to provide you with the right policy and industry reforms that will really prepare us for a better future and a faster growth for the industry.

We have to work closely in generating ideas for policy and program support that you will need in the industry.

The DTI and the DOST is also working towards the Inclusive Innovation Centers. We are tying up with experts and partners from technology and R&D institutions, universities, and corporations. This is something Seretary dela Peña may be mentioning.

This effort will really help us product development, design, high-performance chips, and semiconductor products that will really have high market potential.

Again your government, under President Duterte of course, will help in implementing this roadmap, to help us create a better macroeconomic and industry environment for your sector.

Thank you once again.  Good Morning. I’m sorry, I’ll be running in a while for the Ease of Doing Business Summit that is scheduled before 10 am this morning. We are basically running that program. So thank you once again.♦

Speech of Secretary Ramon M. Lopez, Launch of China International Import Expo (CIIE) (15 March 2018, Fairmont Hotel, Makati City)

SPEECH OF SECRETARY RAMON M. LOPEZ
LAUNCH OF CHINA INTERNATIONAL IMPORT EXPO (CIIE)
15 March 2018, Fairmont Hotel, Makati City 

Ladies and gentlemen, good morning!

I would like to thank to the People’s Republic of China, the Bank of China, Alibaba, and the Philippine Chamber of Commerce and Industry (PCCI) for organizing today’s launch of the China International Import Export Expo (or CIIE) information mission.

Likewise, thank you for giving me an opportunity to speak here today on how the CIIE can not only help boost Philippine-China trade, but also deepen the two countries’ trade relationship as well.

CH International Trade

Today’s event is actually the first leg of the CIIE information mission—entitled “Your Gateway to the China Market”’—and this is also expected to visit the cities of Cebu and Davao on March 20 and 23, respectively.  

To be held on November 5-10 this year in Shanghai, China, the CIIE is a major international event that reiterates China’s strong support for trade liberalization, as well as their way to actively open the Chinese market to the world.

Because of this, the expo is the only trade show in China to date that will feature foreign exhibitors—and no China companies—on the exhibit floor. However, there will be Chinese buyers present, as well as buyers from all over the world at the event.

  • At the CIIE, the focus will mainly be on importation of goods and services to China, with the 6 exhibitions areas featuring trade in goods. These include: High-end Intelligent Equipment; Consumer Electronics & Appliances; Automobile; Apparel, Accessories & Consumer Goods; Food & Agricultural Products; Medical Equipment & Medical Care Products. 
  • There will also be a section for trade in services comprising Tourism Services, Emerging Technologies, Culture & Education, Creative Design, and Service Outsourcing.

For the Philippines, the CIIE will be the biggest ever overseas trade fair that our country will participate in, with over 100 Philippine product and service exporters, as well as investors and government representatives attending the event.

PH-CH Trade Engagements

The participation of Philippine companies in CIIE marks another step in the growth story of the Philippine-China trade and investment relations, as well as the continuing benefits of President Rodrigo Duterte’s independent foreign policy.

From President Duterte’s 2016 state visit to China to the convening of the Philippines-China Joint Commission on Economic and Trade Cooperation (JCETC) last year, we have constantly sought to widen our trade engagements with China. 

  • For example, there is China’s support for infrastructure priority projects like the Chico River Pump Irrigation project, as well as the assistance for earthquake-stricken Surigao worth US$ 1B and the purchase agreement of US$1.7B-worth of agricultural products.
  • We likewise saw several Letters of Intent (LOI) signed last year for potential private sector investment that would result in an estimated US$10.4B-worth of investment and some 11,500 new jobs for Filipinos.
  • There was also the Philippines-China SME Cross-Border Business Matching held last March 2017 that generated a total of 635 matches between Filipino and Chinese enterprises. 

Thanks to these efforts, we are now building on the progress that we’ve achieved, even as Filipino businesses take advantage of the opportunities in working with their Chinese counterparts. 

PH-CH Bilateral Trade 

That’s why it’s no surprise that as of 2017, China was our top trading partner with a total bilateral trade valued at US$ 23.82B billion, and they’ve also become our 4th biggest export market and our top import source. 

  • Our exports to China last year included: storage units (US$ 1.26B); digital monolithic integrated circuits (US$ 1.12B); nickel ores and concentrates (US$ 494.35M); semiconductor devices (US$ 329.74M); and coal (US$ 296.14M).
  • In fact, our total exports to China increased by 9.73% due to the increase in the exports of digital monolithic integrated circuits (68.89%), and cathodes and sections of cathodes of refined copper (566.87%).
  • Meanwhile, Philippine imports from China grew by 8.14%. These include: petroleum oils and oils obtained from bituminous minerals (64.66%); parts and accessories of automatic data processing machines (126.62%); and materials, accessories, and supplies for the manufacture of electrical and electronic machinery, equipment and parts (112.30%), among others. 

CH Market Opportunities

But even with our current trade engagements, the opportunities for trade between Philippines and China can be so much greater.

In 2017, China's total external trade reached US$ 4.1045T with China’s exports and imports increasing by 7.9% and 15.9% (in terms of US dollars), respectively. This has resulted in a trade surplus of US$422.5B for China. 

  • China’s population in 2017 is almost 1.4B, with an increase of almost 125M since 2000. With China rapidly urbanizing, more than half of all Chinese today live in urban areas and up to 70% are expected to be urbanites by 2030. This is an massive increase from the less than 20% of China’s population as recently as of 1980.
  • We’d also like to note that China is ageing at a rapid pace. In 2017, the median age was 37.9 years—7.6 years greater than the figure for 2000—and it will be 41.9 years by 2030, or well above the regional average.
  • Lastly, I ask our Filipino friends and partners from the private sector to note that it’s impossible to ignore the huge US$ 10T Chinese market due to their rapid growth of consumption and imports. Accessing this market will surely leap frog the level of business transactions between the Philippines and China. 

While we all know that China continues to play an important and influential role in the global economy, we foresee even greater opportunities to drive the level of Philippine-China transactions higher with trade events like the CIIE.

Conclusion

In closing, I would like to reiterate how the CIIE can serve as an important opportunity to showcase the trade capabilities of the Philippines, as well as investment opportunities available between our two countries.

At the same time, while this trade event will give our Filipino businesses access to the huge China market, it will certainly help deepen the bilateral trade relations between the Philippines and China.

More importantly, this engagement shows how warm relations are between our two countries—a vast improvement from the past years—and underlines the strong ties of friendship between the Philippines and our good friend and neighbor, China.

That’s why the Philippine government—and specifically, the Department of Trade and Industry (DTI)—remains committed to fortifying and supporting this relationship through the appropriate combination of policy, trade, and investment decisions.

We also hope that China will continue partnering with us to help push President Duterte’s socio-economic agenda to create inclusive growth and shared prosperity, from promoting MSME development to supporting our “Build, Build, Build” infrastructure program.

I am confident that with the solid friendship between the Philippines and China, our two countries can better manage today’s political and economic challenges—even as we benefit from the increased access in trade and investment with each other.

Thank you very much and mabuhay!♦ 

Press Statement of Secretary Ramon M. Lopez, DTI-DICT-NTC JMC Signing on Prepaid Loads (20 December 2017, DTI International Building, Makati City)

PRESS STATEMENT OF SECRETARY RAMON M. LOPEZ
DTI-DICT-NTC JMC SIGNING ON PREPAID LOADS

20 December 2017, DTI International Building, Makati City

 

The national government is committed in ensuring all Filipinos enjoy the benefits of sound telecommunications services in the country, while also protecting their consumer rights. 

As such, the departments of Trade and Industry (DTI) and Information and Communications Technology (DICT), together with the National Telecommunications Commission (NTC), are signing a Joint Memorandum Circular (JMC) to support these efforts. 

With this JMC, the government is amending NTC’s Memorandum Circular No. 03-07-2009, or the Guidelines on Prepaid Loads that cover all prepaid loads of Information and Communications Technology (ICT) providers and public telecommunications entities. 

Specifically, prepaid loads of whatever amount will now have an expiration date that will last up to one year from the date of the top-up. This, in turn, will afford subscribers more time to use their prepaid loads.

  1. The only exclusion to the coverage of this JMC will be those prepaid loads purchased for promotions and other services with a specific period of use, as approved by DTI and NTC.

With this circular, the three government agencies can better protect the rights of Filipinos as consumers given that as of end December 2016, there are around 130 million cellphone subscribers.

  • This is higher than it was in 2009 when the number of subscribers was 75.57 million and the carrying cost per subscriber was Php3.00 per day.
  • Taking into consideration that more than 90% of the costs of the networks are fixed, the carrying cost per subscriber has decreased as the number of subscribers has increased since then.

To reiterate, the 1987 Constitution recognizes the vital role of communication and information in nation-building. As part of a whole-of-government approach, different agencies have their roles to play to fulfill this goal.

  • NTC promotes consumer welfare by facilitating access to telecommunications services via a sound infrastructure and network,
  • Meanwhile, DICT pushes the development and use of ICT through policies, plans, programs, and guidelines.

DTI’s mandate—under Republic Act No. 7394, or the Consumer Act of the Philippines—is to protect consumers against deceptive, unfair and unconscionable sales acts or practices, and from misleading advertisements and fraudulent sales promotions.

Furthermore, while DTI is committed in promoting the rights of consumers and the needs of the individual subscribers, we also want to address the needs of business subscribers using these services.

  • DTI is confident that our Micro, Small, and Medium Enterprises (MSMEs) will be able to do business more easily thanks to this circular, whether by making calls or sending an SMS to their customers, or by accessing the internet to conduct e-commerce.
  • Through greater opportunities accessible via telecommunications, our MSMEs will be able to help us generate inclusive development and shared prosperity for all Filipinos, especially for those at the bottom of the pyramid.

Lastly, with this circular, President Rodrigo Duterte hopes to give the public a gift this holiday season that everyone can truly benefit from in the coming years.♦

Keynote Address of Secretary Ramon M. Lopez at the 2nd Manufacturing Summit (29 November 2017, Makati City)

KEYNOTE ADDRESS OF SECRETARY RAMON M. LOPEZ
MANUFACTURING SUMMIT 2017
29 November 2017, Makati City


[Acknowledgments]
Usec. Rowel Barba, Usec. Nora Terrado [and other DTI officials, Asec. Aldaba, Asec. Perez…;
Mr. Kunihiko Shinoda, METI Deputy Director-General;
Mr. Susumu Ito, JICA Country Representative;
Mr. Clay Epperson, USAID Deputy Mission Director;

Distinguished speakers and panelists; participants from other government agencies; industry associations; and the academic community;

Ladies and gentlemen, good morning!

Macroeconomic performance & economic transformation
These are indeed exciting times for the Philippines. Amid the global economic volatility, the outlook for the country remains positive as we have maintained our strong macroeconomic position.

Our first-to-third-quarter growth in 2017 stood at 6.7%, securing our position as the fastest growing economy in Asia. We outpaced our ASEAN neighbors such as Vietnam, which grew by 6.3%, and Malaysia which registered 5.9%. Our country’s impressive growth has only been eclipsed by China, which grew by 6.9% for the first three quarters of 2017.

Clearly, our recent performance demonstrates remarkable economic resilience, thanks to a resurging Philippine manufacturing industry. This year, manufacturing has been the country’s main economic driver, exhibiting a Q1 to Q3 growth of 8.3%—the highest among the main economic sectors.

The Philippines is now on the verge of economic transformation. While services was the main driver of growth in the past decades, manufacturing has been contributing more substantially to the nation’s economic growth since 2013.

Consider this: from 1999 to 2012, services registered an average annual growth of 5.4%, while manufacturing was growing at an average of 4.0%. But from 2013 to 2016, the average third quarter growth of manufacturing stood at 7.8% while services posted an average of 6.8%.

Another transformation is taking shape as economic expansion is being driven by investments, with capital formation accelerating by 8.6% in the first three quarters of this year. Compare this to consumption and government spending, which rose by only 5.4 and 5.3%, respectively.

With a growth rate of 10.4% in Q1 to Q3 last year (2016), fixed capital formation has remained robust. Durable equipment grew by 11.6%, driven mainly by growth in general industrial machinery and equipment (12.0%) and transport equipment (11.4%).

Meanwhile, net FDI inflows remain strong, amounting to US$5.1B from January to August 2017. With positive investor confidence, approved investments by the Board of Investments (BOI) from January to September 2017 increased by 33% to PhP408.7B from PhP296B during the same period in 2016. Manufacturing sub-sectors covering food, motor vehicles, fabricated metal, and wood products amounted to PhP38.5B, or 9.4% of the total.

High level growth & the employment challenge

Though manufacturing growth has been contributing significantly to our country’s economic growth, its share to GDP of 23% and contribution to total employment of 8% have remained quite unchanged in the last decade.
While our unemployment rate slightly worsened to 5.9% during the first three quarters of 2017 from 5.8% during the same period in 2016, our underemployment rate declined to 15.2% from 17.4% in the same period. Meanwhile, our poverty incidence also improved to 21.6% in 2015 from 25.2% in 2012.

Still, our employment challenge remains: we have 2.5M unemployed and 6.5M million underemployed fellow Filipinos.

The mandate of “Trabaho at Negosyo”

Last year, the Department of Trade and Industry (DTI) organized the first Manufacturing Summit that brought together stakeholders from the government, industry, and academe. The aim of the Summit was to discuss policy directions and strategies to revitalize our manufacturing sector.

With the theme “Trabaho at Negosyo,” the Summit was a venue for the fruitful exchange of ideas on the opportunities and challenges in the manufacturing industry, as well as the steps we could take in shaping its future.

Based on the panel discussions and breakout sessions in the Summit, we identified the following steps to sustain the resurgence of manufacturing and further expand the sector:

  • First, as an initial step towards putting innovation and R&D at the center of our industrial strategy, we will establish innovation centers in the country. This will be done in close coordination with the Department of Science and Technology (DOST) and in collaboration with the academe and industry stakeholders.
  • Second, we will revise and update our industrial policy to consider emerging disruptive technologies, like robotics, AI, and 3D printing. We will coordinate closely with the industry, academe, and other government agencies to discuss these and refine our industry priorities and targets.
  • Third, we will continue the collaboration among government, academe, and industry. In particular, we will focus on the implementation of the priority measures recommended during the Summit’s breakout sessions.

Updates on the Manufacturing Summit 2016

Let me share with you some updates on the priority recommendations proposed in last year’s Summit:

As most of you here know, DTI is actively promoting innovation as key to the competitiveness of Philippine industries. We have modernized the BOI’s Investment Priorities Plan (IPP) towards this direction by providing for incentives for innovation and R&D economic activities.

  • Back in May, we conducted the Inclusive Innovation Conference to launch the roadmapping for innovation in the country. This has been followed by a series of regional innovation workshops conducted in Metro Manila, Cebu, CDO, and Davao. A last one is set to be conducted in December in Clark. Through these workshops, we are soliciting inputs from stakeholders from the regions and we are aiming to formally launch the roadmap in the first half of next year.  The conduct of these innovation fora and formulation of the roadmap resulted in a Memorandum of Understanding (MOU) that DTI signed with DOST to closely collaborate on our innovation initiatives. Both DTI and DOST intend to bring in the relevant national government agencies moving forward.
  • The Intellectual Property Office of the Philippines (IPOPhil) is also formulating our National Intellectual Property Strategy (NIPS), and this will be a key part of our innovation roadmap.
  • Through the Manufacturing Resurgence Program (MRP), DTI and BOI continue to promote collaborative agreements between industry associations, government, and academe in support of inclusive and innovative manufacturing.
  • We also continue to consider human resource development as an essential element of our industry development programs. Towards this, we are closely coordinating with the Commission on Higher Education (CHED) and the Technical Skills and Development Authority (TESDA) with regard to reforms and programs for human capital development.
  • We have been engaging as well various higher educational institutions from all over the country, both private and public, to do our part in bridging the industry-academe divide.
  • With regard to infrastructure, DTI and BOI have been coordinating with the Department of Public Works and Highways (DPWH) in our convergence program on road connectivity for industry and trade development. Called “Roads Leveraging Linkages for Industry and Trade (ROLL IT) Program,” the goal of this program is to prioritize and implement road access infrastructure that leads to various industries and economic zones. Through ROLL IT, we are proposing Php12.3B worth of road infrastructure across the country under the proposed 2018 budget.
  • We are actively supporting the amendment of the Public Service Act, which we hope will finally be done by Congress. And of course, we are supporting the government’s massive “Build Build Build” Program.
  • Notwithstanding the recent dip in our Ease of Doing Business (EODB) ranking, the National Competitiveness Council (NCC) remains determined to push reforms in our business environment and improve our competitiveness.
  • Regarding the development of Micro, Small, and Medium Enterprises (MSMEs), we launched earlier this year our money lending program called the Pondo sa Pagbabago at Pag-asenso (P3). President Rodrigo Duterte had also announced during the ASEAN Summit to pour as much as Php50B for SME development in the coming years.
  • With regard to incentives and other forms of government support, we are coordinating with the Department of Finance (DOF) to ensure that these are performance-based, time-bound, transparent, and easy to administer. We maintain that incentives can be effective tools for industry development and ensure our competitiveness.
  • And finally, regarding trade, we expressed our intention during the meeting between President Duterte and US President Donald Trump on the sidelines of the ASEAN Summit to negotiate and forge a free trade agreement (FTA) with the US.


The Inclusive Innovation Industrial Strategy (i3S)

After a year, we have refined our industrial strategy.

The Inclusive Innovation Industrial Strategy (or i3S) is the new industrial policy formulated by DTI-BOI that aims to grow globally competitive and innovative industries, with innovation at the front and center of industrial policies and programs.

With i3S, there are 12 sub-sectors that are top priorities for industry development, with a focus not only on manufacturing but linking together activities particularly through the servicification of manufacturing. This would connect services activities like design, R&D, engineering, and after-sales with manufacturing.

These sub-sectors and programs include:

  • Auto and auto parts: Auto electronics, CARS Program, Public Utility Vehicle Modernization;
  • Electronic manufacturing services: Auto electronics, medical devices, telecommunications equipment, power storage, civil aviation/ aerospace;
  • Semiconductor manufacturing services: Integrated circuit (IC) design;
  • Aerospace parts and aircraft Maintenance, repair, and overhaul;
  • Chemicals: Petrochemicals, acyclic alcohols & derivatives, metallic salts & peroxy salts of inorganic acids, cyclic hydrocarbons, oleo chemicals;
  • Shipbuilding & Ship-repair: Roll-On Roll-Off (RORO)m as well as small- and medium-sized vessels;
  • Furniture, garments, creative industries: Manufacturing and design;
  • Iron and steel, tool and die: Manufacturing and design;
  • Agribusiness food & resource-based processing: Cacao, coffee, mangoes, bananas, coconut, rubber, bamboo, fruits & nuts, and other high value crops;
  • Construction: Roads, railways, bridges, ports, airports, and low-cost housing;
  • IT-BPM and e-commerce: Higher-earning and more complex non-voice services BPO, Knowledge Process Outsourcing (KPO) in medical, financial, and legal services; game development; engineering services outsourcing (ESO), software development, and shared services;
  • Transport and Logistics: Land, air, and water transport, warehousing, and support facilities for transport given that huge services investments in infrastructure and logistics would boost the competitiveness of industries and improve connectivity within the country; and,
  • Tourism

Major pillars and strategic actions

From this i3S policy, we have now laid out strategic actions to help us achieve our goals. These include:

Building new industries, clusters, and agglomeration via:

  • Addressing gaps and linkages in industry supply and value chains;
  • Expanding the domestic market base to allow industries to attain economies of scale and realize their export potential;
  • Pursuing green policies in industries to make them more competitive, innovative, environment-friendly, and climate smart;
  • Implementing aggressive promotion and marketing programs to attract more foreign direct investments especially those that would bring in new technologies;
  • Addressing market failures by providing fiscal incentives that are well-targeted, performance-based, and time bound;
  • Creating industry clusters to address agglomeration, economies of scale, and coordination issues; and,
  • Promoting the establishment of domestic ecozones that would allow activities catering to both domestic and export markets.

Capacity-building and human resource development via:

  • Designing human resource development and training programs to improve skills and establish tie-ups with universities and training institutions.

MSME growth and development via:

  • Supporting SME development by boosting their growth and profitability through the 7Ms (Mindset, Mastery, Mentoring, Money, Machine, Market, and Models) as well as programs focusing on the establishment of common service facilities, and improving access to finance, technology, and skilled workers;
  • Linking MSMEs with large domestic enterprises and multinationals;
  • Promoting inter-firm and academe collaboration; and,
  • Setting up efficient storage and logistics (like handling and cold storage).

Innovation and entrepreneurship via:

  • Establishing an inclusive innovation and entrepreneurship ecosystem that would link together academe, industry, and government;
  • Strengthening industry-academe collaboration that focuses on market-oriented research,
  • Revising engineering curricula, particularly manufacturing engineering and work related to industries;
  • Equipping universities to carry out research relevant to industries,
  • Ensuring intellectual property protection;
  • Setting up R&D incentives (like tax credit and accelerated depreciation); and,
  • Setting up shared facilities for rapid prototyping and demonstration

Ease of doing business and investment environment via:

  • Continuing to strengthen our institutional and regulatory framework by addressing corruption and smuggling, and eliminating bureaucratic red tape through streamlining and automation of government procedures and regulations;
  • Establishing a single mechanism for coordinating business registration, application for permits and licenses, and investment promotion with local government units (LGUs) and other national government agencies; and,
  • Continuing the big bang infrastructure investment to cover not only the building of physical infrastructure like roads, but also power, logistics, and a modern and efficient air and sea infrastructure.

Inter-agency collaboration

Going back to the collaboration between DTI and DOST, the two agencies agreed to work together to create an inclusive innovation and entrepreneurship ecosystem in the country. Currently, we are working together in formulating and implementing our innovation roadmap.
Based on the aforementioned consultative workshops in NCR, Cagayan de Oro, Cebu, and Davao we have conducted to date, the major recommendations include:

  • The establishment of shared services facilities (like FabLabs) and creation of innovation hubs;
  • Collaboration among government, industry, and academe through joint activities and the use of physical and shared spaces;
  • Capacity-building and skills training; and,
  • Funding support.

In DTI, we are studying the possibility of transforming our 3-hectare Center for Innovation and Technology for Enterprises (or the old CITC) in Marikina as a possible innovation center (like Plug and Play).

The location is appropriate, given that Marikina is home to the footwear industry as well as woodworking and jewelry enterprises. It is also very close to education institutions like UP, Ateneo, Miriam College, and the Marikina University.

Conclusion

To conclude, our vision is for the Philippines to have creative and connected communities (3Cs) of different stakeholders like innovators, start-ups, SMEs, and large enterprises that will collaborate to produce new products and services.

Moving forward, we firmly believe that it is crucial for us to form an innovation council composed of representatives from the government, industry and academe. This would ensure that our country’s innovation policies and programs will be properly implemented leading towards the sustained resurgence of Philippine manufacturing.

Ultimately, these efforts will help us create not only employment opportunities and address income inequality throughout the country, but also ensure that the economic growth resurgence our country is experiencing will be felt by all Filipinos.

By working closely together, we can achieve our goal of generating inclusive growth and shared prosperity for our countrymen, especially for those at the bottom of the pyramid.

Thank you and mabuhay tayong lahat!

 

Opening Remarks of Secretary Ramon M. Lopez, Preparatory Regional Comprehensive Economic Partnership (RCEP) Ministerial Meeting (11 November 2017, Pasay City)

OPENING REMARKS OF SECRETARY RAMON M. LOPEZ
The Preparatory Regional Comprehensive Economic Partnership
Ministerial Meeting (Prep-RCEP TNC)

 

Fellow Ministers of ASEAN and our Dialogue Partners, we are gathered here today in preparation for the 1st Regional Comprehensive Economic Partnership (RCEP) Leaders’ Summit. But before anything else, it is my pleasure to welcome you all and your delegation once again to the Philippines.

For those of us who are tasked with providing guidance and vision in driving our respective economies forward in a constantly shifting global trade and economic landscape, we have our work cut out for us.

We have expressed our collective agreement to achieve a substantial conclusion to RCEP negotiations within the year. We emphasized this commitment during our meeting last September, and even expressed the hope that we will have something significant to report to our Leaders during the ASEAN Summit.

We have had 5 Ministerial level Meetings and 20 rounds of negotiations, with the most recent one hosted by Korea last month. We note the milestones and breakthroughs reached, especially those that yielded substantial outcomes like the conclusion of the Chapters on Economic and Technical Cooperation and the Small and Medium Enterprises.

We also welcome another encouraging development, which is that of Customs Procedures and Trade Facilitation (CPTF) and Competition Chapters that are nearing completion.

Meanwhile, we are still in negotiations to reach substantive agreements on key elements of the RCEP, a task which we have been engaged in since 2012. At this point, let us extend our full support to our negotiating teams, allowing them more room to navigate on contentious issues toward achieving resolutions. Equally, efforts must be further intensified in making this possible.

This is the challenge now facing us: we should be able to provide a concrete and tangible roadmap that our Leaders can agree to and endorse, which will lay the foundations for a binding agreement.

RCEP is of tremendous importance for our economies and the region, and our efforts today can bring about greater progress and economic sustainability for the coming years.

We therefore look forward to having substantial and fruitful discussions, and even solidify our positions in the process. It is imperative for us to finalize the Ministers’ Collective FINAL 12 November 2017 Assessment Report to the Leaders and the Joint Statement of Leaders in negotiating the RCEP.

To conclude, we would like to say that our hosting of this year’s ASEAN would never have been successful without your efforts, collaboration, and cooperation.

With this, I declare the RCEP Ministerial Meeting open. Again, thank you and mabuhay tayong lahat.

 

Opening Remarks of ASEAN Economic Ministers (AEM) Chairperson Ramon M. Lopez, 15th ASEAN Economic Community Council (AECC) Meeting (11 November 2017, Pasay City)

OPENING REMARKS OF
AEM 2017 CHAIRPERSON RAMON M. LOPEZ
15TH ASEAN ECONOMIC COMMUNITY COUNCIL (AECC) MEETING

 

Dear colleagues, we started this year with high hopes, and we are now concluding it on a high note. ASEAN has made tremendous progress and has had such a meaningful year this 2017. This was made possible with the dedication of our economic trade officials, who worked virtually non-stop to help us achieve our targets, and with the solid support and cooperation from our partners from the ASEAN Member States (AMS).

I recall 10 months ago, when the Philippines officially launched its Chairmanship of ASEAN bearing the banner theme: “Partnering for Change, Engaging the World.” Under this theme, our chairmanship had 6 thematic priorities, one of which was “Inclusive, Innovation-Led Growth” for the ASEAN Economic Community (AEC). This thematic priority affirms trade and integration as a powerful engine of economic growth and development for the AEC. In this regard, ASEAN has achieved a measure of success as we continue to link economies and pursue integration and cooperation with strategic external partners.

The establishment of the AEC in 2015 has engendered enormous opportunities in the form of a huge market worth US$2.5T. Vibrant flow of goods, services, investments, and skilled labor are among the benefits of this economic integration. Moreover, the ASEAN Vision and AEC Blueprint 2025 demonstrate that the region is making good progress in formulating a clear way on how to collectively address the opportunities that AEC present.

Nonetheless, we acknowledge that despite our efforts, the issue of development remains a pressing concern with inequity and inclusiveness remaining the biggest challenges within our economies and across the region. Without full participation in trade, growth cannot be truly inclusive and further progress in trade liberalization would be difficult if the benefits are not shared by all.

The theme “Inclusive, Innovation-led Growth” acknowledges the socio-economic dimension of regional economic integration and its contribution to poverty alleviation. This priority urges us to strengthen our commitment for more inclusive participation in the process of community-building, where we all are partners and everyone contributes. This will likewise ensure that the gains presented by economic integration are fully realized and shared by everyone in the region.

I remember our President Duterte also highlighting this point at the recently-concluded APEC wherein for us, the leaders, the way globalization should work is that everyone should emerge as winners, and that globalization should not produce winners and losers but everyone as winners.

This year, we also put greater focus on reinforcing our Micro, Small, and Medium Enterprises (MSMEs) by providing an enabling environment for its development and to enable them to scale up and participate in the global value chain. Given the breadth and extent of the MSME sector in the region, its development would directly contribute to spreading the economic benefits more widely.

Micro SMEs must be full participants and beneficiaries that closer regional economic integration brings. This means further strengthening the role and contributions of micro SMEs so as to attain a dynamic, inclusive, and people-oriented AEC.

We pursued this theme through 3 strategic measures, namely: increasing trade and investment; integrating micro SMEs in the global value chains; and developing an innovation-driven economy. These measures, in turn, were supported by 11 priority economic deliverables related to trade facilitation, trade in services, connectivity, inclusive business, e-commerce, and innovation. These deliverables would ensure the participation of the micro SME sector, as well as the marginalized—like the women and youth—in commercial activities.

With this mind, we are convening today to exchange views on what we’ve done so far in moving the AEC forward. For 2017, we have made good progress in getting AEC 2025 off the ground. After the adoption of the AEC Blueprint 2025, we concentrated our efforts on the development of the Consolidated Strategic Action Plan (CSAP) that serves as the operational framework for the AEC Blueprint 2025. We adopted the CSAP earlier this year and completed additional action plans that are relevant to further increasing intra-regional trade, like trade facilitation and e-commerce.

We take this opportunity as well to prepare and firm up our deliverables and report to our Leaders who are set to meet few days from now. These include notable developments in our external economic relations like the completion of the negotiations for the ASEAN-Hong Kong, China Free Trade Agreement (or AHKFTA) and the Investment Agreement (AHKIA).

There is also the endorsement of the Terms of Reference (TOR) of the Feasibility Study for an ASEAN-Canada FTA Agreement and the subsequent undertaking of the study. Further, there is the convening of the Joint Working Group that is tasked to assess the possibilities for the resumption of the ASEAN-EU FTA negotiations. Lastly, the level of engagement that we had on the Regional Comprehensive Economic Partnership (or RCEP) this year is unprecedented, demonstrating and galvanizing ASEAN’s leadership in the negotiations process.

Ladies and gentlemen, ASEAN continues to progress year after year through our concerted efforts. The challenge of sustaining this and ensuring that we reach the kind of community that our forefathers envisioned us to become—a community that is secure, inclusive, prosperous, and stable—requires us to work even more closely.

My term as AEM Chairman comes to an end. Allow me to express my deep gratitude to everyone for your support and hard work to ensure that our Chairmanship, which coincides with the 50th Anniversary of ASEAN, is a success. I would also like to congratulate our fellow economic trade officials for a job well done.

Again, thank you very much and I wish a productive discussion ahead of us.

Mabuhay tayong lahat!

 

 

Statement of DTI Secretary Ramon M. Lopez, Chair 49th Association of Southeast Asian Nations (ASEAN) Economic Ministers' Meeting (11 September 2017, Pasay City)

Statement of DTI Secretary Ramon M. Lopez, Chair 49th Association of Southeast Asian Nations (ASEAN) Economic Ministers' Meeting Press Briefing (10 September 2017, Pasay City)

Statement of DTI Secretary Ramon M. Lopez, Chair 49th Association of Southeast Asian Nations (ASEAN) Economic Ministers' Meeting Press Briefing (9 September 2017, Pasay City)

Statement of DTI Secretary Ramon M. Lopez, Chair 49th Association of Southeast Asian Nations (ASEAN) Economic Ministers' Meeting Press Briefing (8 September 2017, Pasay City)

Speech of DTI Secretary Ramon M. Lopez 49th Association of Southeast Asian Nations (ASEAN) Economic Ministers' Meeting Opening Ceremony (7 September 2017, Pasay City)

Speech and presentation of DTI Secretary Ramon M. Lopez at the opening of the Manufacturing Summit 2016 (26 November 2016)

Statement of DTI Undersecretary Ceferino S. Rodolfo, Philippine Lead 49th Association of Southeast Asian Nations (ASEAN) Economic Ministers' Meeting Press Briefing (10 September 2017, Pasay City)

Statement of DTI Undersecretary Ceferino S. Rodolfo, Philippine Lead 49th Association of Southeast Asian Nations (ASEAN) Economic Ministers' Meeting Press Briefing (9 September 2017, Pasay City)

Statement of DTI Undersecretary Ceferino S. Rodolfo, Philippine Lead 49th Association of Southeast Asian Nations (ASEAN) Economic Ministers' Meeting Press Briefing (8 September 2017, Pasay City)

Opening Statement of Trade Undersecretary/BOI Managing Head Ceferino Rodolfo Press Conference on BOI Guinogulan Awards (25 April 2017)

Press Statement on Ease of Doing Business Reforms by Undersecretary Rowel S. Barba (May 2018)

PRESS STATEMENT ON

EASE OF DOING BUSINESS REFORMS

BY

CEODBG UNDERSECRETARY ROWEL S BARBA 

  1. Last week, the Doing Business Survey Team of the World Bank came to our country to validate the reforms for the 2019 Cycle of the Doing Business Survey. We would like to share these reforms so that our citizens will be better informed on the interventions of government on how to make doing business in the Philippines easier.
  2. You will recall that the Philippines ranking dropped from 99 to 113 in the 2018 WB DB Survey. Since the time we met in November to announce the ranking, the EODB Task Force, composed of 13 agencies have been working doubly hard.
  3. I am pleased to report the reforms made by the various agencies of your government.
  4. On Starting a Business
    1. [SEC] Full operationalization of the Company Registration System in November 2017, which is an online registration for company registrations being operated by the Securities and Exchange Commission;
    2. [QC] Setting up of an Enhanced One-Stop Shop in Quezon City starting January 2018 in Quezon City, which co-located all concerned units/offices in one facility – the Business Permits and Licensing Office, the Zoning Office and the Treasurer’s Office, and the Bureau of Fire Protection – and made it convenient for applicants to register new businesses;
    3. [BIR] Instituting a Single Window Transaction Project where applicants can submit documents and be issued the Certificate of Registration and Authority to Print;
    4. These measures will reduce procedures from 16 to 10 and the processing time from 28 days to 16 days.
  5. On Dealing with Construction Permits
    1. [QC-LGU] Setting up of a One-stop Shop for Construction-related Permits in Quezon City that co-located 3 offices of the city government and the Bureau of Fire Protection;
    2. Making the Barangay Clearance a post-requirement;
    3. These measures resulted to reduced procedures to 8 from 23 and the processing time to 36 from 122 days.
  6. On Getting Electricity
    1. [MERALCO] Online application for electricity connection from MERALCO, including setting up of a MERALCO booth in QC’s One-stop Shop for Construction Permits;
    2. Eliminating the requirement to secure a Certificate of Final Electrical Inspection from the Quezon City Government, which is now issued together with the Certificate of Occupancy;
    3. Procedures have been reduced to 3 from 4 and processing time from 37 to 28 days.
  7. Registering Property
    1. [LRA] Automation of the operations of the Land Registration Authority and the Registry of Deeds in Quezon City that shortened processing time and led to better transparency of information;
    2. In terms of quality indicators, the Posting by LRA of relevant statistics is also a major reform that shows transparency;
    3. Procedures remain at 9 steps but the processing time improved greatly from 35 to 20 days.
  8. Enforcing Contracts
    1. [Supreme Court] Implementation of the automated raffling of cases and electronic case management system under the Supreme Court’s eCourt implementation
  9. That government is serious in promoting ease of doing business is an understatement. We take to heart our task to improve our competitiveness by making doing business in the Philippines easier.
  10. But there are more REFORMS UNDERWAY.
  11. Government is working on the following that will further promote ease of doing business:
    1. Signing into law of the Ease of Doing Business and Efficient Government Service Delivery Act of 2018;
    2. The amendments to the Corporation Code, which will affect two indicators – Starting a Business and Protection Minority Investors;
    3. The Secured Transactions Bill, which will strengthen the legal rights index under the criterion on Getting Credit;
    4. Implementation of the Unified Employee Enrolment Portal, which is an online one-time reporting system to be established by the Social Security System, the Home Development Mutual Fund, and the Philippine Health Insurance Corporation for employees of newly registered businesses. This will reduce the procedures and processing time for enrolment of new employees in the criterion on Starting a Business;
    5. Implementation of the Transfer Assistance Program by the Quezon City government that will streamline the procedures for securing the tax declaration, tax clearance, and for paying the transfer tax – all of which will reduce the processing time for registering property.
  12. We assure our kababayans that we will continue to pursue these reforms because as we increase our competitiveness, more investments will come in, and more jobs will be created.
  13. We hope that our friends in media will help us relay these achievements to the public, and to the world at large to show that the Philippines is always open for business.

 

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