Meeting the challenge of ASEAN 2015: Private sector initiatives

Excerpts from a speech by Ambassador Alfredo M. Yao, President, Philippine Chamber of Commerce and Industries (PCCI), at the 3rd National Symposium Workshop on E-Power organized by UP ISSI and SERDEF, April 10, 2014

AEC3The forthcoming integration in 2015 will transform ASEAN into an integrated and single economy characterized by and conducive to expanding markets, attracting investments, and promoting competition among member economies through external economic relations and enhanced participation in the global supply chain networks.  The integration provides a platform to open opportunities to Philippine firms or, alternatively to encumber the country with liberalization obligations that could hinder the growth of small and medium enterprises and other domestic industries. 

Such free trade arrangements, therefore, pressure SMEs to enhance their competitiveness and productivity.

If ASEAN is to succeed in its integration, it has to encourage more businesses to develop and sustain their participation in global value chains and production networks as well as improve their overall competitiveness and growth. Such challenges have encouraged countries to develop new and appropriate strategies and measures that would allow them to share in the bounties of the new environment.

PCCI’s thrust on ASEAN integration

The PCCI recognizes the important role of the private sector as the driving force in the ASEAN Economic Community (AEC)-building process.  Since 2002, when the ASEAN Business Advisory was created, PCCI has taken a lead role in the conduct of consultations and coordination with government, private sector and civil society.

In 2007, PCCI formed U-ACT, its designated trade policy and research arm and since then, it has launched and intensified a nationwide consultation process and awareness campaign on AEC in partnership with government, to be able to reach as many businesses nationwide.

PCCI’s key initiatives

PCCI’s initiatives in engaging the local business community in the ASEAN implementation are founded on a threefold strategy of: advocacy and capacity building, market access through infrastructure and logistics under the ASEA Ro-Ro platform and SME internationalization through market linkages and business matching.

The following are some of these initiatives.

Advocacy and capacity building

PCCI’s interventions in promoting business engagement in regional integration have included (a) the creation of the Philippine Learning centre for Trade Policy or PLACE which runs modules on trade policy advocacy to include market access, export competitiveness, rules of origin, standards conformance, among others, (b) the publication of ASEAN FTA primers of which more than 10,000 copies have already been produced and used in various capacity building programmes, and (c) conduct of researches such as the analysis of Philippine commitments in ASEAN SERvices Agreement, Analysis of 11 priority sectors under AEC. 

ASEAN connectivity

In this respect, PCCI together with ASEAN BAC, spearheaded a memorandum of cooperation between the Philippines and Indonesia business leaders for the establishment of the Davao-General Santos-Bitung Ro-Ro route. Following this was a meeting that took place with DTI Secretary Gregory Domingo, where an agreement was reached to operationalize the ASEAN Ro-Ro service with support from President Aquino.  This paves the way towards the country’s full use of the available policy instruments and infrastructure to benefit from the AEC.

SME internationalization through business matching and market linkages

The PCCI has been working with our ASEAN BAC partners to spearhead business matching and market linkages activities in the region.  To-date, we have activated more than 30 business councils, several of which are operating within ASEAN.  Supporting the operation of our business councils are various memorandum of understanding we signed with more than 100 chambers around the world to network and link our members in business matching activities

Proudly Philippine-Made

It is well known that many Philippine products have made their presence felt in the ASEAN market – Zesto and Air Asia Zest for flavored drinks and air travel, Champion for laundry detergents, Hapee for toothpaste, EQ for diapers, Alaska for milk products, Splash Corporation, Belo Skincare, San Miguel, Jollibee. However, these are the companies that have the tools and skill sets to be competitive, thus making them ready for the ASEAN integration.

But what about industries that are less than ready?

This is the reason for the PCCI’s “Proudly Philippine-Made” advocacy and movement.

Through this work programme, we will help our industries and future entrepreneurs to develop a competitiveness mind set, a blazing drive for excellence, and the willingness to pursue production of quality products.   Whether they will be direct suppliers or participants in the supply chain, we need to empower our SMEs to be able to participate in the milieu of trade openness.

Under the “Proudly Philippine-Made” programme, we will work to make our local products not only competitive but recognized in terms of the highest standards of quality and safety. 

The business community, government and institutions like UP ISSI will work together towards providing SMEs with access to technology, common service facilities, financing and other support to infuse not only a competitiveness mindset among them but to provide them with resources to help them find more niches for their increased participation in the value and supply chains and their eventual expansion, upgrade and meaningful participation in the forthcoming ASEAN integration.

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