ASEAN 2015: Implications on Philippine Human Resource Development
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1 1 ASEAN 2015: Implications on Philippine Human Resource Development Undersecretary Adrian S. Cristobal Jr. Department of Trade and Industry Managing Head, Board of Investments 2nd National Technology Vocation Congress SMX Convention Center, Pasay City29 October 2013
2 Outline ASEAN Economic Community (AEC) and PH Manufacturing Resurgence of Philippine Manufacturing Our Strategies HRD: Matching Skills with Industry Needs
3 3 ASEAN Economic Community & PH Manufacturing
4 4 Distributed Manufacturing Source: Asian International Economists Network, ADB
5 CURRENT SITUATION AND GLOBAL OPPORTUNITIES Disrupted Supply Chain in Neighboring Countries Rising labor cost in China Calamities in Thailand & Japan Increasing tension between Japan & China Labor disputes and strikes in China & Vietnam Aging Asian Countries Renewed optimism in Japan - ABENOMICS ASEAN Economic Community in 2015 and Other FTAs
6 6 ASEAN at a Glance (2012) Ten member states at varying levels of economic development Population of 616 million people Combined income (GDP) of US$ 2,306 billion Average GDP per capita of US$ 3,744 Total exports (to world) of US$ 1,265 billion Total imports (to world) of US$ 1,243 billion Total intra-asean trade of US$ 33 billion Source of data: World Economic Outlook April 2013 Database, International Monetary Fund; TradeMap, International Trade Center
7 7 ASEAN and Its Partners Entry Into Force (EIF) 2005 Market Size (MS) 1.97B Economy Size (ES) US$ 10.6T Total Trade (TT) US$ 319B EIF 2010 MS 625M ES US$ 4.0T TT US$ 79B EIF 2007 MS 647M ES US$ 3.5T TT US$ 131B EIF 2010 MS 1.81B ES US$ 4.3T TT US$ 76B EIF 2008 MS 726 M ES US$ 8.3T TT US$ 262B
8 8 Non-FTA Partners PH Top Markets, 2012 FTA Partners Source: NSO
9 Trade in Goods 9 FREE FLOW OF GOODS WAS SUBSTANTIALLY ACHIEVED WITH THE REALIZATION OF THE AFTA IN Percent of Total No. of Tariff Lines at ATIGA 0% Brunei Darussalam 99.03% Indonesia 98.66% 2010 Percent of Total No. of Tariff Lines at ATIGA 0% - 5% Cambodia 98.53% Lao PDR 95.18% Malaysia 98.68% Philippines 98.63% Singapore 100% Thailand 99.84% Myanmar 99.28% Vietnam 99.68% *Based on: 1. AFTA-CEPT Packages from the ASEAN Secretariat website 2. Okabe, M. and S. Urata (2012), The Impact of Trade Liberalization in ASEAN on Intra-ASEAN Trade flows (mimeo)
10 10 Trade in Goods As of 2010, all duties have been eliminated on agricultural and industrial products Except for: live swine, live chicken, meat of swine, meat of chicken, manioc (cassava) and sweet potatoes, maize, rice and sugar Duties maintained at 5% beyond 2015 for (1) Live swine; (2) Live chicken; (3) Meat of swine; (4) Meat of chicken, turkeys, ducks, geese and guinea fowls; (5) Manioc (cassava) and sweet potatoes; and (6) Maize. Rice duty at 40% until 2014; 35% by 2015 Sugar Duty: 18% (2013) ; 10% in 2014; 5% in 2015
11 PH Trade deficit with ASEAN In US$ Million PH Trade Deficit with ASEAN - Without oil - Without oil & rice (4,307) (5,601) (3,947) (5,124) (7,543) (2,051) (3,622) (791) (3,404) (4,645) (1,716) (3,265) 594 (2,465) (3,010) - Without oil, rice & petrochemicals (1,095) (2,658) 1,102 (2,219) (2,705) - Without oil, rice, petrochemicals & automotives (554) (2,105) 1,808 (1,638) (2,291) Source: NSO (processed by BITR)
12 12 PH Trade with ASEAN (2012) Top 10 Imports from ASEAN Product Group % Share 1 Electrical, electronic equipment Mineral fuels, oils, distillation 14.8 products 3 Machinery, nuclear reactors, boilers Vehicles other than railway, tramway Plastics and articles thereof Miscellaneous edible preparations Animal, vegetable fats and oils, 2.5 cleavage products 8 Cereals Essential oils, perfumes, cosmetics, toiletries 10 Optical, photo, technical, medical, etc apparatus Top 10 Exports to ASEAN Product Group % Share 1 Electrical, electronic equipment Machinery, nuclear reactors, boilers Vehicles other than railway, tramway Mineral fuels, oils, distillation 3.0 products 5 Optical, photo, technical, medical 2.7 apparatus 6 Copper and articles thereof Tobacco and manufactured tobacco substitutes 8 Cereal, flour, starch, milk preparations and products Rubber and articles thereof Fertilizers 1.2 Source: ITC Trademap, August 2013
13 13 PH Trade with ASEAN Our (growing) trade with ASEAN is largely intraindustry in nature (we trade in products belonging to the same industries) Electronics: We export intermediate components but import finished products We sell Thailand motor vehicle parts; they sell us motor vehicles Our trade relationship in ASEAN are largely complementary rather than competitive in nature; opportunities lie in regional (and global) value chains
14 AEC & PH Manufacturing PH Manufacturing Industries are already competing in an open regional market. Our key industries are integrated in regional and global supply chains. We are the fastest growing economy in the fastest growing region, amidst global uncertainty.
15 Manufacturing Resurgence 15
16 GROSS NATIONAL INCOME by INDUSTRIAL ORIGIN Percent Share to GNI, At Constant Prices 1 st Half,
17 Manufacturing Performance 6.6% growth rate in total Gross Revenue Index, Q1 of % GVA output in manufacturing relative to GDP, Q1 of
18 16 Our Strategies Develop priority industries Support industry initiatives Provide protection and security
19 Industry Roadmapping Project On 30 January 2012, the DTI-BOI launched the Industry Development Program (IDP). To date, 21 sectoral roadmaps have been submitted to the DTI and forwarded to PIDS; nine (9) have been presented in Trade & Industry Development (TID) updates. The sectoral roadmaps serve as the building blocks of the Manufacturing Industry Roadmap (MIR) and the Comprehensive National Industrial Strategy (CNIS). The Manufacturing Industry Roadmap was presented in the first TID Update (August 2013). 17
20 Completed Sectoral Roadmaps 18
21 Roadmaps under Development 19
22 20 Major cross-sectoral issues Infrastructure Logistics Power and Energy Research & Development Human Resource Development Local Government Regulations International Marketing & Promotions
23 21 Identified gaps in HR Skills & Training Requirements
24 Manufacturing Employment Accounts for 14.5% of employment (3,171,000 jobs) Among PH Strengths Industrial peace Pool of young, trainable, English speaking workers Identified Constraints Need for skilled workers, need for trainings (Metal casting, tool & die, auto & motorcycle parts, furniture, chemical, rubber, plastic, iron & steel) 22
25 Critical and In-demand Skills / Training requirements Sectors Auto parts, Tool & Die Chemical, Rubber, Plastics Furniture Metal casting Tool & Die Iron & steel Type Design, tool making, prototyping, molding, die & casting Chemical engineering, Materials Engineering Supervisory, managerial, consultancy for improved productivity Foundry technology, Metallurgical Engineering, Mechanical Engineering, Industrial Engineering, Metal casting Engineering Die design, Tool & Die Engineering Vocational trainings (TESDA) 23
26 26 PHILIPPINE DAILY INQUIRER, 06 AUGUST 2013
27 CONCLUSION Often, we underestimate our capabilities. Our people are our biggest asset.
28 29 ASEAN 2015: Implications to Philippine Human Resource Development Undersecretary Adrian S. Cristobal Jr. Department of Trade and Industry Managing Head, Board of Investments 29 October 2013 SMX Convention Center, Pasay City
29 27
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