Globalization and International Trading (Import/Export)

[Arvor]

Quantity vs quality ...

[april boy]

90% of Isuzu vehicles
sold are Philippine-made

Malaya Business insights
August 31, 2010

Isuzu Philippines Corp. said it is committed to sustain a high level of assembly operations in the Philippines even as tariffs continue to fall.

IPC President Ryoji Yamazaki said 90 percent of the vehicles that the company sells in the country are locally assembled "made by Filipinos for Filipinos."

Yamazaki said IPC also sources parts and components that are locally available, thereby contributing to the Philippine economy.

"We intend to continue this in our effort to help uplift the domestic manufacturing industry," Yamazaki said.

Isuzu in the Philippines has been producing and selling locally assembled vehicles, such as the Crosswind AUV, the D-MAX pickup and our light- and medium-duty trucks.

One of the vehicles that is proudly Philippine made from Isuzu which is yet to hit the streets is the Microbus, is a 16-seater all-purpose vehicle that is bigger than a regular van but smaller than a coaster.

It will be geared for mass transport such as the shuttle services now plying the roads. It can also be used as delivery vehicles.

The Microbus seats can be rearranged and can be custom-built depending on the requirements of the customers.

Using the NHR engine and power train from Japan, the Microbus is imported completely knocked-down from Indonesia and built locally by Centro,

IPC eyes to sell 40 to 50 units a month of the Microbus.

Utilizing the NHR chassis, this Microbus is designed to carry more passengers or larger cargoes compared to the standard vans. The seats can be rearranged depending on the customer’s requirement. It has a dual-aircon for that much needed comfort for all passengers and it can be installed with any additional accessories based on current market demand.

The overall length is 5,025 mm; overall height is 2,250 mm; and, its overall width is 1,700 mm.

The commercial launch of the Microbus is yet to be set with a cost of P1.3 million per unit.

Most of the components that went into the production of two prototype units were imported. The body is sourced from a local maker, Centro Manufacturing Corp. while the chassis is produced by IPC.

[Ady001]

I hope ituloy-tuloy na nila yan. Hindi lang heavy duty ones kundi pati na rin bus.

(Not to be offensive or anything but since some buses were the cause of road mishaps nowadays, perhaps making buses that will be conditioned to our roads will be good not only for us but also to other countries.)

[april boy]

Originally Posted by Ady001

I hope ituloy-tuloy na nila yan. Hindi lang heavy duty ones kundi pati na rin bus.

(Not to be offensive or anything but since some buses were the cause of road mishaps nowadays, perhaps making buses that will be conditioned to our roads will be good not only for us but also to other countries.)

Other bus companies resort to buying old imported buses (mostly Japanese and Korean junks smuggled into Subic, Cebu, Manila or Cagayan).

We have respectable local brand new bus assemblers in Centro, Almazora and StaRosa motors to name a few.

They should buy from these companies instead of again importing and smuggling imported ukay ukay buses that are very dangerous.

[jpdm]

RP to pursue FTAs with 6 countries

By Ma. Elisa P. Osorio
(The Philippine Star)
Updated September 02, 2010 12:00 AM Comments (1) View comments

MANILA, Philippines - The government is looking at entering into free trade agreements (FTA) with six countries led by the United States to boost foreign trade.

In a press conference, Trade Undersecretary Adrian S. Cristobal Jr. said that they are now mulling the possibility of discussing FTAs with the US, Taiwan, Vietnam, Europe, India and China.

Although the country has an FTA with the ASEAN and China, Cristobal said it is still beneficial the Philippines if there is a separate agreement with Taiwan.

“Within the year we would like to open a formal discussions with Taiwan,” he said.

Former Trade Secretary Jesli A. Lapus has already said that a bilateral agreement with Taiwan is not necessary because the Philippines and Taiwan already have the Joint Economic Conference. Lapus said that with this in place, a free trade agreement (FTA) with Taiwan is no longer needed because the JEC will already ensure good trade and investment relations.

However, Ambassador Donald Lee, Representative of the Taiwan Economic Cooperation Office (TECO), already warned the Philippines that the signing of the Economic Cooperative Framework between China and Taiwan in July would result in the transfer of some Taiwanese factories in China because it is cheaper to produce in China.

Lee cleared that the FTA with the Philippines has nothing to do with the one China policy. He stressed the urgency of forming an FTA with Taiwan because he said firms would choose to locate in China because of the big domestic market. China has a population of 1.2 billion while the Philippines only has 92 million. The access to raw materials is also easier in China rather than the Philippines.

[april boy]

5 BOC men face raps over smuggled rice

By Evelyn Macairan
(The Philippine Star)
Updated September 03, 2010 12:00 AM Comments (18) View comments

MANILA, Philippines - The Bureau of Customs (BOC) has filed smuggling charges against five of the agency’s employees who were implicated in the smuggling of rice into the country that deprived the government of P183 million in revenue.

Customs Commissioner Angelito Alvarez also relieved yesterday and placed on preventive suspension five bureau employees suspected of conniving with an importer and a Customs broker in the smuggling of 312,400 sacks of rice into the country.

Alvarez reportedly imposed sanctions against principal Customs examiners Vicitacion Difontorum and Theresa Agabao, Customs examiner Margarita Santiago, and acting document processors Taha Cali and Glen Ollero.

The suspects reportedly aided Lamberto Espiritu, owner of Point Given Marketing located at Unit 1719 Cityland Condominium, 720 Pablo Ocampo Jr. Avenue (former Vito Cruz), Malate, Manila City; and Customs broker Allan Jay de Vera Gahon of 2565 Interior 1, Jose Abad Santos St. in Tondo, Manila in the smuggling of 312,400 sacks of rice that were loaded inside 781 container vans.

Each container van reportedly contained 400 sacks of rice.

The BOC’s Run After the Smugglers (RATS) group also filed at the Department of Justice (DOJ) charges for violation of the provisions of the Tariffs and Customs Code of the Philippines (TCCP) and the Revised Penal Code (RPC) against the five bureau personnel, Espiritu and Gahon.

Alvarez said the filing of the charges against the Customs employees is intended to send a strong warning to employees that the criminal liability of officials accused of conniving with smugglers is equivalent to the criminal liability of brokers and consignees.

Customs Deputy Commissioner Gregorio Chaves, concurrent executive director of the BOC’s RATS program, added that “despite all glaring violations of the TCCP and the absence of the required permit from the appropriate government agencies such as the National Food Authority (NFA), the responsible personnel of the Port of Manila allowed the release of the subject 781 containers in favor of Point Given Marketing, making them criminally liable, particularly the customs examiner and appraisers.”

The Revenue Integrity Protection Service (RIPS) of the Department of Finance (DOF) will conduct lifestyle checks on the five bureau employees.

The white rice shipments were allegedly misdeclared as mung beans, which under Customs laws were exempted from the payment duties and taxes, while rice importations should have been slapped with 50 percent duties and 12 percent value added tax (VAT).

With the reported deception, the government was deprived of collecting P183 million in duties and taxes.

The shipment that came from Vietnam arrived at the Port of Manila from January to May of this year.

Meanwhile, Finance Secretary Cesar Purisima encouraged the public to cooperate with the efforts of the government to curb smuggling and tax evasion in the country.

He said that the DOF website www.perangbayan.com is a feedback mechanism where the public can report the performance of civil servants. The website has so far received more than 1,000 tips. The information is given to the concerned agency.

The BOC, by November, intends to implement a new segregation scheme for imported cargo.

The shipments would either be classified as super green, green or red. This is part of the agency’s efforts to counter smuggling activities in the country.

Cargo that go through the super green lanes are shipments “that would be considered like domestic shipment because they have no corresponding tariffs such as semiconductors and beans,” said Alvarez.

Shipments that would fall under the green lane are those with reputable importers, maybe those that belong to the top 200 companies. The red lane items would be those that require scrutiny such as general merchandise.

He estimated that it would only take 24 hours for the imported products to be released under the super green lane; one to two days under the green lane and two days to one week under the red lane.

The innovation on the segregation of cargoes is patterned after the practice in Indonesia.

[april boy]

China to boost imports to help world recovery

(The Philippine Star)
Updated September 07, 2010 12:00 AM Comments (0) View comments

BEIJING — A Chinese official defended the country’s trade record Monday as a top economic adviser to President Barack Obama visited Beijing amid renewed pressure by American lawmakers over Chinese currency controls.

China’s deputy trade envoy, Chong Quan, rejected complaints that Beijing intentionally boosts its trade surplus by promoting exports while holding down imports. Speaking at a trade forum, Chong repeated promises to boost imports of resources and high-tech equipment and to ease costs for importers but announced no new initiatives.

“This criticism is unfounded,” Chong said. “China, in its own actions, makes its due contribution to the world’s economic development.”

Chong spoke as US National Economic Council Director Larry Summers was in Beijing to meet China’s top trade official, Vice Premier Wang Qishan. No agenda was announced, but their talks were likely to include US complaints that a weak yuan gives Chinese exporters an unfair price advantage.

China’s trade surplus widened in July to an 18-month high of $28.7 billion as imports weakened. That helped to fuel complaints by some American lawmakers who want Beijing to allow the yuan to rise or face possible trade sanctions.

American lawmakers set aside criticism of China’s trade policy while the two governments worked together to end the global crisis. But pressure has resumed as the crisis fades and American leaders face pressure to create jobs.

In June, Beijing ended an 18-month-old link between the yuan and the dollar and said it would allow a more flexible exchange rate, but the Chinese currency has risen by only 0.6 percent since then. The US Commerce Department in August declined to launch an investigation of the currency complaints despite requests by some lawmakers.

American legislators have scheduled two congressional hearings this month on China’s currency and possible retaliatory measures.

[Linguine]

Free ports to adopt e-cargo transfer system

Written by Henry Empeño / Correspondent
Thursday, 09 September 2010 12:10

SUBIC BAY FREE PORT—The three adjoining free ports of Subic, Clark and Bataan will start utilizing high technology this month to ensure the fast, safe and secure transfer of cargo to their registered business locators as well as to thwart smuggling and diversion of imported goods.

According to the Subic-Clark Alliance for Development (SCAD), officials from the three free ports of Central Luzon recently met with SCAD and Bureau of Customs (BOC) officials “to tie loose ends” before the Sept. 16 implementation of the Enhanced Automated Cargo Transfer System (e-Acts), which is touted to improve the country’s import shipments system.

The free ports summit was attended by officials of the SCAD and the BOC, and representatives of the Subic Bay Metropolitan Authority (SBMA), Clark Development Corp. (CDC) and the Authority of the Freeport Area of Bataan (Afab).

“All concerned agencies vowed to exert greater efforts in responding to the call of President Benigno S. Aquino for a better business environment and a more favorable investment climate in the Philippines that will lead to a better way of life for Filipinos,” the SCAD said in a statement.

The e-Acts was designed to provide for a more efficient movement of imports from the Ninoy Aquino International Airport, the Port of Manila and the Manila International Container Port Terminal to the various export producers located in Subic, Clark and Bataan free ports.

The new system reportedly stands out compared to previous systems because it utilizes modern technology to provide a faster, more economical and simpler process of documenting and processing of clearances, as well as the transfer and admission of foreign merchandise from ports of discharge.

And because e-Acts substitutes electronic or Internet protocols for face-to-face transactions, it is expected to help stamp out corruption in import transactions and to cut overhead costs among free-port locators by allowing the immediate delivery and use of transit goods.

With its built-in antismuggling or antidiversion feature, e-Acts will serve as a showcase of the BOC’s “intention and commitment to put a stop to the abuse of the importation privilege of some unscrupulous free-port zone export producers,” said Customs Commissioner Angelito Alvarez.

Speaking for the free ports, Afab chairman and administrator Deogracias Custodio said the implementation of the e-Acts “will be a reflection of the constant efforts of the Philippine free ports to improve the level of services that they offer to their locators in order to become the free ports of choice in the world.”

SCAD chairman Nestor Mangio expressed optimism that the new system would create a better business environment in Clark and Subic that would, in turn, result in more investments and more jobs for local residents.

“Needed revenues to fuel the local economy will increase. Entrepreneurship potentials for local suppliers will be developed. Even local tourism will be favorably affected,” Mangio added.

The implementation of the e-Acts will be the latest in a series of cooperation programs between the BOC and the free ports in Central Luzon to curb smuggling and plug revenue leaks from goods imported into the free ports and later sold outside the special economic zones.

On July 15 the SBMA and the BOC began using the electronic Gatepass Management System (GMS) for shipments brought into the Subic Bay Free Port to ensure that only “legal goods” would exit the gates here.

Like the e-Acts system, the GMS was designed to make it even harder for smugglers to use the port of Subic, as well as to reduce the time and cost of doing business in this free port.

source

[Linguine]

The Negrenses’ Spirit
By MELITO SALAZAR JR.
September 12, 2010, 4:54pm

MANILA, Philippines – A former First Lady at the height of collapse of the sugar industry and with pictures of a starving child similar to one from Biafra, asked, “Mayabang pa ba sila sa Negros?” (Are they still boastful in Negros?) Others like her who envied the brash confidence of the Negrenses, their easygoing ways, their love for the good life, and their penchant to show off the best of their culture and society feigned sympathy but in reality gloated over their misfortunes. Some even believed that the Negrenses would never rise. They were all proven wrong.

The Negros Trade Fair now on its 25th year is not just a showcase of the best of Negrenses’ products – home, fashion, gifts, and food; it is a testament to the Negrenses’ spirit of perseverance over adversity, of innovation in times of change, and of helping others even when one is also in need.

When I go to the fair, this year held in Rockwell on Sept. 15-19, I do not go just to meet old friends from Negros and Manila, to eat the delicious lumpia or authentic KBL (kadios, baboy, and langka) or get fresh supplies of utility bags, picture frames, and canned pickles but to imbibe that Negrense “can do” spirit and reinvigorate my pride in being a Negrense.

I remember the years when Amy (now in New York with our new granddaughter Tamlin) and I religiously would visit the Negros Trade Fair, whether in Shangrila-La Mall, SM Megamall in Mandaluyong, Greenbelt, Gateway Mall, and now in Rockwell since 2006. We still have a Star of Hope, dozens of which we gave out to friends and relatives abroad; the ceramic belen with the distinctly bright colors; the laminated picture frames, hundreds of which we gifted business associates and fellow Rotarians, and memories of the delicious, delectable mango tarts, guapple pie, lumpia, piayas, pinasugbu, and Manapla *****.

This year I bought from Casa Carmela — Papa Daniel’s Pitaw, Kadios & Batwan salad dressing, Pinoy Pate Bacolod Chorizo, Queso de Bola Piayitos and colorful banadas; from Tflavors — Tambo and Gulay Pinoy atchara and my favorite, pickled batuan; from Elise’s — 4 rolls of garlic bread; from El Ideal — the iconic lumpia; and garlic flavored cashew nuts from the Vallehermoso Helping Hands Foundation, Inc., dedicated to transforming Vallehermoso into a “progressive municipality with fully developed potentials in the hands of the educated, cultured, nationalistic, and capable professionals, artists, artisans, and a technically skilled populace."

There was still more to buy — the array of Organic Personal Care products of Millette Jalandoni, whose daughter Francine told me they started with organic fertilizer, then-high value vegetables, and now bath and massage oils and FreshStar natural mouthwash. Nature’s Haven had Yacon wine among other wines, teas, syrups, and liniments. Khrystian Reyes’ Reycon’s elegant piña barong and gown materials which they also supply to Exclusively His; Salvacion Ledesma’s PAPEL Handicrafts with beautiful bags made of paper from telephone directories and magazines by farm workers in Silay; mascobado from Alter Trade and Roxas Holdings, Inc. (Central Azucarera de La Carlota and Hawaiian Philippine Company); fantastic handicrafts and furniture of Tumandok Crafts industries with in-house designer Carlos Lanuza; Silay Export Inc.’s resin plates, lamps, panels with leaves, coco coir- imbedded designs; and Jojo Vito, a 20th Bulawan Awardee, with top of the world home furnishing. The surprise was the Bogsbrew line of beers made by the Bacolod-based Bob’s Fruit Farms of Felix Hagad.

Let’s raise a bottle of Bogsbrew to the 25th Negros Trade Fair and the inspiring Negrenses’ spirit!

Business Bits. My grandmother once told me that there are things left better unsaid. I offer her advice to our present crop of government officials.

source

[vinceli]

I think most asian countries benefit from outsourcing. In the U.S. for example most jobs are getting outsourced to countries like the Philippines and India. Outsourcing spells job loss in the U.S. http://www.newsbeats.net/showthread....utsourcing-end the Philippines should grow from this.

[Linguine]

More x-rays eyed in Manila ports

Written by VG Cabuag / Reporter
Wednesday, 15 September 2010 12:36

THE Bureau of Customs (BOC) plans to add more x-rays to scan more containers of goods at the two major ports in Manila to deter smuggling.

Customs Commissioner Angelito Alvarez said on Wednesday he has communicated his plan to increase the number of x-rays in the ports to the operators of Manila South Harbor and Manila International Container Terminal (MICT), which handles more than half of the country’s volume of imports.

According to the plan, the BOC will increase the number of x-ray at the Port of Manila or the Manila South Harbor from three to five and also at the MICT from the current two to five.

This means that a third of all the nonintrusive container x-rays of the BOC will be placed at the country’s capital, instead of placing them in other ports where they are not utilized as a result of low volume of goods that need checking, Alvarez said.

“They were receptive to the idea,” Alvarez said, referring to the heads of Asian Terminals Inc., operator of Manila South Harbor, and International Container Terminal Services Inc, which manages MICT.

Alvarez said the availability of space for the x-rays is the primary concern of the port operators. “But they promised to do something about it,” he said.

X-ray machines where not fully utilized at the Batangas port, Alvarez said, because the port still has to work double time to entice locators to use the facility and for the ships to call at the port.

Alvarez said he would look for other ports that need the x-rays more, so the machines will not be put to waste.

According to the risk-management assessment of the BOC, which implements the tagging systems of all the shipments, all those tagged as super-green lane will not undergo documentary or physical examination, while those classified under the yellow lane will have to undergo random sampling. Those assessed under red lane will all have to undergo physical and documentary examination.

As a trade-facilitation rule, the government should not hamper the release of cargo from the port.

At the moment, the BOC scans 80 percent of the international containers that pass through the ports, way above the best international practice of transshipment ports such as Hong Kong and Singapore at 8 percent to 10 percent random scanning rate.

Alvarez said the Philippine rate was even higher compared with Indonesia’s 40 percent.

The BOC charges $5 for every 20-footer container and $10 for the 40-footer containers.

Since 2007, port users have been asking for the reduction of the scanning rate, because the longer the cargo stays at the port, the higher the cost of the shippers.

http://www.businessmirror.com.ph/hom...n-manila-ports

[vishaya]

Originally Posted by vinceli

I think most asian countries benefit from outsourcing. In the U.S. for example most jobs are getting outsourced to countries like the Philippines and India. Outsourcing spells job loss in the U.S. http://www.newsbeats.net/showthread....utsourcing-end the Philippines should grow from this.

US is still losing jobs and there's no end in sight.....

as of this month;
US unemployment = 9.7%
US underemployment = 18.4%

Philippines unemployment = 6.9%
Philippines underemployment = 17.9%

looks like we are better off than US with these figures. hope our new administration can sustain the momentum.

[april boy]

Export Growth Target Revised to Exceed $50.4 B, Marking Full Recovery in 2010

By EDU LOPEZ
September 26, 2010, 1:34pm
Manila Times

MANILA, Philippines – The Philippine Exporters Confederation (Philexport) has revised its export target growth this year to exceed $50.4 billion, marking a full recovery of the sector in only one year.

The new fighting target was disclosed by Philexport president Sergio Ortiz-Luis, Jr. during a recent meeting with the Export Development Council (EDC).

The new target was announced a week after the National Statistics Office (NSO) made public the hefty growth of exports in the month of July that even outperformed the growth in the previous month.

It was the seventh straight month of high double-digit recovery for the country's export industry. Coming out of 15-month battering since the trade tsunami spawned by recession in the most developed economies hit our shores in the last quarter of 2008.

EDC had earlier forecasted a 20 percent over-all growth in Philippine exports which result would have equalled the $49 billion in export sales in 2008. The earlier projection foresaw a two-year full recovery of the export sector.

Rapid growth in sales for the first seven months of this year prompted players in the industry to review their projections and set higher targets of this year.

The expected new investments and high growth of the mining industry, precious and industrial metal exports is expected to help push exports to the new target.

Dollar revenues from the export of mineral and metallic products produced by the mines grew by 24 percent in the first half of this year and estimated by the Chamber of Mines to have contributed P156 billion to the national economy.

[Linguine]

Boat captain, 3 others nabbed for smuggling P5 million crude oil

By Non Alquitran (The Philippine Star) Updated September 28, 2010 12:00 AM Comments (0) View comments

MANILA, Philippines - A boat captain and three others were reportedly caught smuggling at least 21,000 liters of crude oil with an estimated value of P5 million at a port in Manila over the weekend.

National Capital Region Police Office (NCRPO) chief Director Leocadio Santiago said the suspects have been smuggling crude oil into the country for several years but were “untouched” because of the protection of an influential person in the past administration.

Their activities deprived the government of millions of pesos in duties and taxes, he said.

“My men have been receiving monetary offers in exchange for the release of the smuggled crude oil but we politely turned them down,” Santiago said. “Instead, we filed charges against the suspects to warn others involved in the illegal smuggling that we mean business.”

He identified those arrested as boat captain Rene Isaga, 62; boat quartermaster Ardo Mallorca, 56; driver Michael Gutierrez, 36; and Joseph Santos, 43, a truck helper.

Superintendent Remus Medina, head of the NCRPO’s regional police intelligence and operations unit (RPIOU), and his men proceeded to Pier 4 of the North Harbor in Delpan, Tondo and caught the suspects while siphoning the crude oil from a barge into a waiting gasoline truck (UDC-549).

The suspects could not present papers to cover the transport and unloading of the crude oil, said Medina.

The RPIOU chief said Gutierrez was about to deliver the said crude oil to a place somewhere in Luzon where the cargo would be refined as diesel fuel.

The four men were charged with illegal trading of petroleum products and violating the oil deregulation law before the Manila prosecutor’s office. They are being held in the RPIOU detention center at Camp Bagong Diwa in Taguig City.

[Linguine]

New niches for export diversification cited

THE PHILIPPINES should diversify its export portfolio by developing its potential in inorganic chemicals, copper, copra oil and food, as global demand for the country’s niche products -- electronics, garments and furniture -- is weakening, the International Trade Centre (ITC) said in a study.

The Geneva-based agency identified such priority products after tracking which Philippine exports have enjoyed growing demand and market share since 2004.

ITC is a joint agency of the World Trade Organization and the United Nations formed to help developing economies improve their exports. Its services are focused on capacity building in business and trade policy, export strategy, trade support institutions, trade intelligence and exporter competitiveness, its Web site said.

Focus

"Information technology products, apparel and wood carpentry are the main sectors in which the Philippines is more established, [but] where, in the last years, demand has been weak...and producers have lost export share," the ITC said in an undated study released in a seminar it co-organized late last month.

Philippine electronics, which account for nearly two-thirds of the country’s export sales, have cornered a declining share of the world market, data from the ITC Web site show. Specifically, the Philippines’ share in global electronic sales declined to 1.06% in 2008 from 1.5% in 2004.

"China is the Philippines’ main competitor for this product," the ITC report stated.

Locally made non-crochet garments and furniture have likewise seen their market share contract since 2004, the data showed.

Philippine garment exports bagged just 0.62% of global sales in 2008, nearly halved from its 1.03% share in 2004.

The market share of furniture shipments had likewise been halved to just 0.15% in 2008.

Promise

To cope, the country should grow other exports which have enjoyed rising demand and competitiveness, the ITC said.

Inorganic chemicals, for instance, enjoyed a market share of 0.25% in 2008 from just 0.04% four years ago, according to ITC data.

And there is room to grow as this commodity accounted for less than 1% of the Philippines 2008 export sales, ITC data show further.

"Chemicals are one of the export sectors in which the Philippines has recently gained competitiveness by increasing its world market share by 30% annually," it said, citing in particular those used in electronics and automotive parts manufacturing.

"[And] developing production of chemicals to serve as input for the two major Philippine export sectors makes economic sense," the ITC added.

The agency prescribed export promotion in the form of online business matching.

Sought for comment, a chemical industry group confirmed that the Philippines is currently expanding its market share.

"While, previously, the target markets were very narrow like Japan, Netherlands, USA, today our exporters reach a wider range of countries in Europe, Asia, including Latin America," Samahan sa Pilipinas ng mga Industriyang Kimika (SPIK) President Robert F. Batungbacal said via e-mail.

"I think our exports will continue to grow and penetrate more markets. We’re in the most dynamic trade region in the world, which is the China-ASEAN trade area," Mr. Batungbacal said.

Government role

Still, the government will have to intervene by improving quality of infrastructure, particularly power and water utilities, he said.

Investment promotions to bring in technology and encourage local research are also needed, he added.

Bureau of Export Trade Promotions Director Senen M. Perlada similarly said in a phone interview that government support will have to focus more on lowering operating costs, as marketing efforts are best done between businesses.

The ITC went on to cite copper, copra oil and food preparations from meat and vegetables as the other products with growing demand.

Currently, however, these promising products represent less than a tenth of the Philippines’ export portfolio.

Copper accounted for just 3% of 2008 export sales, while the others -- fruit and meat preparations (1.4%) and vegetable oils (2.14%) -- were likewise minorities, ITC data show.

"[But] the Philippines currently holds slightly more than 1% of world exports of copper products and has increased market share by more than 10% annually since 2004," the ITC said, noting further that opportunities for this product were especially promising, given its high export value.

Copra oil and food preparations have likewise benefited from good demand and relatively high market share, the ITC said.

With competition from India growing in the copra market, manufacturers should reorient production towards refined variants and also diversify their markets instead of just concentrating on the United States, ITC said.
|


http://www.bworldonline.com/main/content.php?id=18921

[Linguine]

Empowering banana entrepreneurs

Ireneo D. Dalayon
Chief Executive Officer
Federation of ARB/Banana-Based
Cooperatives of Davao (FEDCO)

The Philippine Cavendish banana is considered one of the nation’s top income-generating crops. Not only is it a strong source of foreign revenue, it is also a primary source of employment for thousands of small farmers in the provinces. These, precisely, were the reasons why Ireneo D. Dalayon, CEO of the Federation of ARB/Banana-Based Cooperatives of Davao (FEDCO), decided to focus on the banana industry for his business and advocacy.

Mr. Dalayon first saw the potentials -- and the problems -- in the industry when he worked for a fruit company. His job was to look for small farmers to grow fresh bananas. His interaction with the farmers provided him with an understanding of the inner workings of the industry, gaining deeper insight and knowledge on banana production and growership agreements.

His personal assessment was that there were some inequities and flaws in the system. Many small farmers claimed they remained poor because big export corporations purchased their produce at a fixed price, depriving them of the maximum profit they could earn.

Mr. Dalayon recounts that he has met so many small banana farmers who owe millions to banks. They are unable to earn enough to pay off their loans due to the low buying prices of traders. This was what motivated him to do something to help uplift the lives of these small farmers.

To further enhance his knowledge of the industry, Mr. Dalayon became a banana grower himself. His objective was to initiate gradual yet sweeping changes in how growership agreements were conducted.

"Experiencing for myself the challenges banana farmers faced inspired me to negotiate for better prices, so that small farmers can get better returns on their labor," he says.

To achieve this goal, Mr. Dalayon spearheaded the establishment of FEDCO in 1999. Since its inception, FEDCO has served as the umbrella organization for banana growers’ cooperatives. It is composed of farmers who are agrarian reform beneficiaries operating in Davao City and the provinces of Davao del Norte, Davao del Sur and Compostela Valley. From a starting membership of seven banana cooperatives, FEDCO has grown to nearly 20 member cooperatives with around 3,600 farmers owning 5,000 hectares of land.

Traditionally, banana growers under contracts with multinational banana corporations have limited freedom to manage their own farms. The corporations can dictate the entire production process, from planting to harvesting and packaging. In some cases, the cost of production is even deducted from the growers’ small earnings.

Through FEDCO, Mr. Dalayon helped organize these cooperatives to give banana growers better control of their operations and more freedom to negotiate the selling price of their produce, based on market demand and the quality of their crops.

FEDCO also plays an important role as the marketing arm for its member cooperatives, promoting the benefits of direct linkage with international buyers. Early on, FEDCO worked on negotiating contracts directly with foreign buyers in Japan. By going directly to the buyers, Mr. Dalayon was able to raise banana buying prices to 10 times their previous rate. Under his leadership, FEDCO consequently went on to conduct trade missions and make direct contracts with global fruit buyers in China, Korea and the Middle East.

Given the opportunity to market directly to international buyers, banana growers were able to eliminate costs from third-party marketing channels and middlemen.

Freed from restrictive growership agreements that delineated their production practices, growers had more flexibility to optimize operations. Greater profits also meant that they could afford to invest more in innovations that reduced their cost of production.

"Happily, our efforts are paying off. Big fruit importers now deal directly with small banana growers, offering them much higher prices for their produce," says Mr. Dalayon.

To keep up with the high global standards demanded by foreign buyers, FEDCO collaborates with different local government agencies to continuously provide banana growers with training, seminars and market exposure. More importantly, FEDCO sees to it that its best farming practices are followed by growers in all the member cooperatives -- from planting and fertilizing to harvesting and packaging.

Over the years, FEDCO has nurtured a more inclusive and proactive business environment for its members. Beyond just improving the production process, FEDCO also keeps its members well informed about sound business practices and strategies to help them grow.

Mr. Dalayon avers, "Transparency in doing the business is very important for you to gain the trust and respect of people with whom you do business. Without mutual trust and respect, you won’t last."

Today, FEDCO continues to build relationships and export directly to the international market. In late 2009, the Japanese government sponsored a FEDCO trade mission to their country to help promote the understanding of the banana market and to assist FEDCO connect with more Japanese fruit buyers.

Mr. Dalayon is also optimistic about increasing FEDCO’s global market share once other small banana growers see the benefits of joining the cooperative.

FEDCO is also developing new products from banana by-products such as fiber, chips and animal feeds. Mr. Dalayon is optimistic that this will maximize productivity and limit waste. FEDCO has begun planning for the manufacture of its own organic fertilizers and other farm inputs, catering to the international demand for fruit products produced using organic-based pesticides and fertilizers. Anticipating potential demand, FEDCO also has plans to expand into palm oil production and collaborate with potential local and international buyers.

In the long run, FEDCO’s initiatives have helped growers better enjoy the fruits of their hard work.

Growers have also become more motivated to ensure quality in the fruit they produce. Being a member of the Davao Cluster Capacity Enhancement Project (DICCEP), FEDCO aims to empower more banana growers in the region and further improve and sustain the operations of all its member cooperatives.

Mr. Dalayon hopes to inspire all small banana farmers in Mindanao to take charge of their future, and to work together to strengthen and improve the industry.

He says, "We measure our success by how much we’ve helped banana growers improve their lives. By helping banana growers upgrade their practices and businesses, FEDCO can truly become an instrument of change in the industry."

The Entrepreneur Of The Year Philippines 2010 is sponsored by SAP Philippines. Official airline is KLM Royal Dutch Airlines, operating on behalf of the Air-France KLM Group in the Philippines. Media sponsors are BusinessWorld and the ABS-CBN News Channel. The winners of the Entrepreneur Of The Year Philippines 2010 will be announced on Oct.12 at an awards banquet at the Makati Shangri-La Hotel. The Entrepreneur Of The Year Philippines will represent the country in the World Entrepreneur Of The Year 2010 in Monte Carlo, Monaco in June 2011. The Entrepreneur Of The Year is produced globally by Ernst & Young.



http://www.bworldonline.com/main/content.php?id=18922

[april boy]

Strong peso can harm export growth, says export leader

By Philexport News and Features
(The Philippine Star)
Updated October 11, 2010 12:00 AM Comments (1) View comments

MANILA, Philippines - The head of the umbrella organization of exporters cautioned exporters not to be lulled by the sector’s rapid recovery which could easily turn to rapid decline.

Addressing members of the Philippine Exporters Confederation Inc. (Philexport) during a national membership meeting in Manila recently, Sergio R. Ortiz-Luis Jr., president, lauded individual exporters for the high double-digit recovery in export sales for the first seven months of the year.

If sustained until the year ends, the rate of recovery could bring exports to equal sales in 2007, the peak year in exports before the global recession.

The big challenge today, he said, is to transform rapid recovery to sustained growth.

“A major stumbling block in sustaining export growth is an exchange rate policy that has always been biased in favor of a strong peso,” Ortiz-Luis said.

The peso-dollar rate hovered a few centavos above 44 this week from 48 to the dollar when export recovery began in January.

He urged the Aquino administration to take a second, harder look at the exchange rate policies of China and Vietnam that gave them the vitality to sustain their bid to become newly industrializing economies.

“Both countries have deliberately made their currencies weak to keep their exports cheap in the global marketplace,” Ortiz-Luis pointed out.

“After the irresponsible investment bankers in the US and Europe almost ground to a halt the global economy, old assumptions like equating a strong peso with a strong economy is no longer gospel truth,” said the export leader.

“What we have seen for decades is that, a strong peso equals a stagnant economy,” he added.

He further called on policy makers to weigh the losers and winners under a strong peso policy regime.

Among the winners, he said, are the traders of imported goods and their principals, the smugglers, and the government that has to pay its ballooning dollar loans.

The rest of the country, he pointed out, turned out losers. These include the lowly rice and onion farmers and domestic industries that have to compete with smuggled goods and cheaper imports, the call centers, families of overseas Filipino workers and exporters.

“It is ironic that the biggest losers in this unequal equation are the very people bringing in the dollars, the OFWs and the exporters,” he observed.

[first knight]

Rethink export tack, PCCI urges

Malaya Business Insights
October 12, 2010

The country’s strategy for export development and growth should hinged on industries where the Philippines has a natural and human-resource advantage, Philippine Chamber of Commerce and Industry president Francis Chua said.

Chua said these include IT-related industries, BPO/contact centers, tourism, fashion garments, jewelry, medical services, healthcare and wellness and retirement, electronics, automotive, agribusiness/ food processing/mariculture and ship-building.

The group is rallying government and its member exporters to re-examine the export strategy and expand value chain activities to increase and sustain the country’s export margin.

PCCI said its own export development plan is congruent with the overall premise of economic growth that can be mainstreamed by enhancing the competitive advantage of the export products and services.

This requires the identification of critical operational and policy impediments to the expansion of the domestic production base in the global value chain, interfaced with the opportunities offered by the regional trade regime under Asean and bilateral trade agreements, Donald Dee, PCCI vice chairman said.

PCCI also said export diversification would be an important policy shift that should be considered to re-orient the export plan towards higher-value added activities where sectoral mapping can be undertaken.

This will identify potential export winners and match the same with the needed infrastructure and logistical support, technical skills and education of human capital supporting the stages of production processes.

PCCI said the Philippine Export Development Plan (PEDP) must be complemented with an industrial policy.

PCCI’s policy recommendations for export and industry development will form part of the broader set of resolutions that will be presented during the 36th Philippine Business Conference and Expo (PBC&E). President Aquino is expected to receive and give his reaction to these resolutions.

The PBC&E is the biggest annual gathering of businessmen in the Philippines to dialogue with government and other stakeholders on key policy issues that affect the country’s state of business and economy. This year’s PBC&E will be held fromOctober 13 to 15 at the historic Manila Hotel and is expected to draw around 2,000 participants from PCCI’s network of local chambers, industry associations and foreign business councils.

[first knight]

AgriNurture acquires 2 Chinese food firms

By Zinnia B. Dela Peña
(The Philippine Star)
Updated October 12, 2010

MANILA, Philippines - AgriNurture Inc., a leading supplier of fresh and processed agricultural food products, has signed an agreement to acquire 51 percent each of Sunshine Supplies International Co. Ltd. and Xiamen Wantaixing Trading Corp. for a combined $2.5 million.

In a disclosure to the Philippine Stock Exchange, AgriNurture said payment will be made in two tranches.

Sunshine Supplies is in the business of trading fruits and vegetables
in Hong Kong, Macau and Europe while Wantaixing is into trading of commodities, principally plastic feeds, grains and cavendish banana, in the Greater China Region.

For the first three quarters of the year, the combined sales of the two Chinese companies amounted to almost $10 million.

AgriNurture said these acquisitions ensure a continued and strengthened growth in international business not only as one of the country’s top exporters of Philippine mangoes but also as a new player in the banana industry particularly in Greater China.

Trading in shares of AgriNurture was suspended yesterday to allow the investing public equal access to the company’s announcement. Trading will resume today (Oct. 12).

AgriNurture is planning to raise between P1 billion and P1.5 billion through a follow-on offering to fund its expansion program which includes acquisition of facilities for farming, cold storage and wet market operations.

In July, the company announced it was planning to raise around P500 million through a stock rights issue to finance acquisitions. Shareholders can buy one share for every one share held as of a record date yet to be determined by the company for P2.50 each share.

Subscribing shareholders shall also be entitled to free warrants at a ratio of one warrant for every two shares acquired from the rights issue. The warrants are of European call option, exercisable after three years at a strike price of P10 per share.

AgriNurture currently exports banana, papaya, pineapple and mango to parts of Southeast Asia, Canada, Europe, South Korea and the Middle East. The bulk of its produce is shipped to China.

AgriNurture is mandated to undertake an initial public offering a year after its listing by way of introduction on May 25, 2009. – With Marianne Go

[hakz2007]

Trade groups seek export diversification

MANILA, Philippines—The Philippine Exporters Confederation Inc. and the Philippine Chamber of Commerce and Industry are pushing for the diversification of exports, with focus on higher-value products.

In a statement issued Monday, Philexport president Sergio Ortiz-Luis Jr. said the country should consider a policy shift when it came to exports, as the reorientation to higher value-added activities would help identify resources needed to support such export undertakings.

“Export diversification would be an important policy shift that should be considered to re-orient the country’s export plan toward higher value-added activities where sectoral mapping can be undertaken,” he said.

“This will identify the country’s potential export winners and match the same with the needed infrastructure and logistical support, technical skills and education of human capital supporting the stages of production processes.”

For his part, PCCI president Francis Chua said the country should focus on sectors where it had natural and human resource advantages, including information technology and related industries, business process outsourcing, tourism, fashion garments, jewelry, medical services, healthcare and wellness, retirement, electronics, automotive, agribusiness, food processing, mariculture and shipbuilding.

In crafting the Philippine Export Development Plan, he said a complementary industrial policy should also be formulated.

Formulated every three years, the PEDP serves as a roadmap of the export industry, outlining relevant strategies and policies. The PEDP forms part of the country’s overall international trade strategy and the Medium-Term Philippine Development Plan.

“The thrusts of our export development plan ... can be mainstreamed by enhancing the competitive advantage of the country’s export products and services,” PCCI vice chairman Donald Dee said.

http://business.inquirer.net/money/b...iversification