Presentation on theme: "Company LOGO Technical Barriers Facing Philippine Exporters Case Study of Electronics and Garments Exports John Lawrence Avila University of Asia and the."— Presentation transcript:
Company LOGO Technical Barriers Facing Philippine Exporters Case Study of Electronics and Garments Exports John Lawrence Avila University of Asia and the Pacific, Philippines
Agro-Based49% Mineral Products -18% ELECTRONICS - 3% Garments - 7% OtherManufactured Products – 10% Forest Products - 10% Others - 2% 1976 ELECTRONICS66% Garments and Textiles - 6% Machinery and Transport - 4.4% Wearables - 0.16% Food - 2.9% Motor Vehicles and Parts - 1.74% Home Furnishings - 1% Marine Products - 1% Giftwares - 0.45% Construction Materials - 0.49% Organic Products - 0.18% Mineral Products - 2.1% Others - 13% 2005 From coconuts to chips
Source: BETP/DTI % TO TOTAL RP EXPORTS TOP 5 EXPORTS 2005 1.ELECTRONICS 66 % 2.GARMENTS 6% 3. Agro-Based & Processed Food 6% 4. Machinery & Transport 4% 5.Forest/Mineral Products 2% 6.Others 16%
Exports grew at average 17%, 1995-2005 Electronics exports stood at around USD 27.3 billion in 2005.
Over 60% goes to East Asian region USA - 13% US$ 3.3 Billion EUROPE - 19% US$ 5.1 Billion JAPAN - 18% US$ 4.8 Billion OTHER ASIA - 37% US$ 10.6 Billion Hongkong- US$ 2.8 B Singapore- US$ 2.1 B Malaysia - US$ 2.1 B Taiwan- US$ 1.4 B Korea- US$ 1.0 B Others- US$ 1.2 B Source: Bureau of Export Trade Promotion, DTI CHINA - 13% US$ 3.5 Billion
CLASSIFICATION OF THE ELECTRONICS INDUSTRY PHILIPPINE ELECTRONICS INDUSTRY ELECTRONIC DATA PROCESSING Personal Computers, Hard Disk Drives, Floppy & Zip Drives, CD ROM, Motherboards, Software Development, Data Encoding and Conversion, Systems Integration Customization TELECOMMUNICATIONS Telephones, Pagers, VHF,UHF Radios, Cellular Phones, Scanners, Satellite Receivers COMPONENTS AND DEVICES (SEMICONDUCTOR) Pentium III, DSPs, Integrated Circuits, Transistors, Diodes, Resistors, Coils, Capacitors, Transformers, Lead Frames, PCB OFFICE EQUIPMENT Photocopy Machines and Parts, Electronic Calculators COMMUNICATIONS AND RADAR Pagers, CCTV, Radar Detectors, Marine and Land Mobile Radios, CB Transceivers CONSUMER ELECTRONICS TV Sets, Electronic Games, Radio Cassette Players, Karaoke Machines, Radio Cassette, Recorder CONTROL & INSTRUMENTATION PCB Assembly for Instrumentation Equipment MEDICAL AND INDUSTRIAL Spiro Analyzers, Smoke Detectors AUTOMOTIVE ELECTRONICS Electronics Brake Systems (EBS), RC Systems, Car Radios, Wiring Harness Source: Masterplan for Philippine Electronics Industry 1998
EMS – 26% COMPUTER REL.PROD./EDP – 20.17% CONSUMER ELECTRONICS – 2.07% AUTOMOTIVE ELECTRONICS – 1.45% COMMUNICATIONS AND RADAR – 0.98% OFFICE EQUIPMENT – 0.70% TELECOMMUNICATIONS – 0.59% CONTROL & INSTRUMENTATION – 0.06% MEDICAL AND INDUSTRIAL – 0.03% SMS – 74% COMPONENTS AND DEVICES - 74.03% EMS 26% SMS 74% Exports are mostly parts and components
ISO 9000 Certified, member of International Electrotechnical Commission (IEC) Lead in ASEAN Electronics Forum and ACCI Electronics committee Observes best known methods in manufacturing (JIT,TQM, 5S, QPIC) Participates in MRAs for Electrical and Electronic products testing and certification Capabilities Range from IC Packaging, PCB Assembly, Full Product Assembly Promotes harmonization of safety and EMC standards in ASEAN SEIPI Industry Standards
Sources: Philippine Board of Investments (BOI) & Philippine Economic Zone Authority (PEZA) Malaysia 2% Others 8% Europe 7% Taiwan 4% Singapore 2% Philippines 28% Korea 10% Japan 30% US 9% 883 Firms NATIONALITY: 72% Foreign 28% Filipino Exports are mostly intra-industry trade DOMINATED BY MNCs
Industry profile Predominantly Filipino-owned SMEs Import-dependent, sourcing over 80% of their textile requirement (polyester fiber, cotton, rayon, and acrylic) from abroad Extensive sub-contracting practice stemming from relations fostered by MFA regime (particularly for US market) Philippine firms part of triangle manufacturing
Standards issues for garments Subject more to fashion trends and less on government regulations Standards a function of sub-contracting arrangements and branding Conformity assessment costs usually assumed by buyer Social and labor standards imposed on those seeking access to US markets ROO and licensing issues more prominent
Manufactures subject to NTBs Origin requirementsFurniture, footwear, woven fabrics, wood products, glass fibers, broadcast receivers, gear boxes, car batteries, radiators Labeling requirements Car parts, cream products, herbal soap, hats and headgear, footwear Prior authorization requirements Telephonic parts, gloves and mittens
Manufactures subject to NTBs Licensing requirementsElectrical circuits, semi-conductors, transmission and other car parts, footgear, handbags, leather coats, tableware and kitchenware, ornamental articles, cement, ceramics, cream products, perfumes, detergents, make-up preparations Standards requirements Electrical wiring harness, transmission, broadcast receivers, car batteries, radiators, tableware and kitchenware, ornamental articles, cement, ceramics, cream products, perfumes, detergents, make-up preparations Testing, inspection and quarantine requirements Electrical wiring harness, make up preparations, perfumes, powders, hair products Quota restrictionsGears
Summary Standards not a serious trade impediment Impact on standards is a function of buyer-driven model, i.e. specification of inputs is determined by foreign buyers Garments and electronics part of global production network AFTA is not a natural export destination for Philippine garments and electronics
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