PHILIPPINES - Economic boom and opportunities for Czech exporters
At the beginning of April, we held a territorial webinar about Philippines, which took the audience through basic facts about the Philippines, its macroeconomic data, trade balance with the Czech Republic and interesting facts about the economy and the local market. The webinar presented the Philippines in a different light than as a destination for a holiday by the sea, waterfalls or conquering often active volcanoes. Inter-governmental delegations with the Czech Republic and the European Union show how pro-European the Philippines are in its outlook for the future.
The Philippines, consisting of more than 7,600 islands and has become a major player in the macroeconomy within the Association of Southeast Asian Nations (ASEAN) region. Its dynamic and growing market offers a wide range of trade opportunities for international partners, including the Czech Republic. There are some challenges, but the potential advantages prevail, especially in the selected sectors, which the webinar discussed directly with entrepreneurs from the Philippines.
Macroeconomic Position of the Philippines in ASEAN
The Philippines boasts one of the most dynamic economies in the ASEAN region. Its GDP growth is among the highest in Asia. According to the statistics for 2023, the Philippines achieved GDP growth of 5.6%, well above the ASEAN average. This growth is supported by a strong domestic market, rising investment and sectoral diversification.
Negative Trade Balance with the Czech Republic
While the Philippines offers huge potential for trade, the Czech Republic faces some challenges in the form of a negative trade balance. This gap between imports and exports may be due to various factors, including differences in trade preferences, market access, and diversification of trade flows. However, there is a scope to strengthen trade cooperation and redress this imbalance. CzechTrade Philippines is therefore working intensively with several partners from the Czech Republic already and supporting their entry into the local market.
How to find partners in the Philippines
Finding partners in the Philippines is a tortuous journey full of positive negotiations and subsequent silence. Filipinos are positive with a really friendly attitude. Where they usually clash are the delays or no follow-up communication. It's not rude, but as a rule Filipinos don't want to convey negative news and often prefer to remain silent. There are many ways to find partners, but the most effective is a personal approach and physical presence in the Philippines. In this regard, CzechTrade has the services that "replace" you on the spot and can, whether by phone or in person, find, awaken and move Filipino partners towards future business success. Long-term Export Assistance (DEA) is the service that CzechTrade Philippines offers and implements most often.
Sectors for Importing to the Philippines for Czech Companies
We touched on several prospective sectors in the webinar from a general perspective, but we went deeper into those sectors that are currently the most important ones for CzechTrade Philippines. Thanks to the active government delegations with the Czech Republic, such as the visit of the Philippine President Ferdinand Romualdez Marcos Jr. in Prague and Agriculture Minister of the Czech Republic, Marek Výborny to the Philippines, the topic became agriculture and food processing. Here, we focused mainly on machinery and equipment for agriculture, foods, compound feed or specific food products.
Another sector was waste and waste management, which was presented by Mr. Ronald Lacsamana, AVP Business Development Director of Phil. Ecology Systems. Waste is a topic that has been resonating here in the Philippines for many years and the cooperation started by the mission supported by the Embassy of the Czech Republic in Manila and CzechTrade Philippines has led to a successful start of cooperation. It was a Philippine company that developed cooperation with a cluster of Czech companies dealing with waste in the Czech Republic. The visit of the Philippine company to the Czech Republic at the end of 2023 has set them on an active cooperation and early implementation of waste sorting and treatment here in the Philippines.
HR services are another topic where the Czech Republic is currently holding its ground. The increase in official quotas to the value of 10,500 employees per year is leading to a proactive approach of recruitment agencies and finding cooperation in the Philippine market. The webinar was attended by Ms. Tereza Tat'áková, Director of Complex International Recruitment, who took us through the basics of this industry specifically from the Philippine perspective. In the presence of up to 750 certified agencies, it is not easy to choose the right one. Currently, up to 10% of the Filipino population (about 12 million) work in the world, with as much as US$37 billion sent to the Philippines in 2023. This huge amount of money is one of the main pillars of the local economy, which is why staffing agencies are one of the most scrutinized industries here in the Philippines.
The Philippines is an attractive destination for Czech companies looking for business opportunities in Southeast Asia. Strengthening trade ties between the Philippines and the Czech Republic can bring mutual benefits
Written by: Ondrej Puchinger, Director CzechTrade Philippines
