The Philippine Trade and Investment Center (PTIC) represents the Department of Trade and Industry (DTI) at the Embassy of the Philippines in Seoul, Korea. Its principal tasks are: to promote Philippine export products and services in Korea, secure Korean investments to the Philippines and encourage Korean retirees to make the Philippines their second home. PTIC provides the following services:

    Assistance to Korean Importers:
  • Information on Philippine products and services
  • Identify Philippine suppliers
  • Arrange business meetings in the Philippines
  • Assist in attending trade fairs in the Philippines
    Assistance to Korean Retirees:
  • Information on the Philippine retirement program
  • Arrange meetings and visits to the Philippine Retirement Authority
  • Advice on how to comply with requirements
    Assistance to Korean Investors:
  • Information on investment laws, incentives, registration
  • Identify investment opportunities
  • Arrange meetings and site visits in the Philippines
  • Advice on how to do business in the Philippines

Philippine Trade and Investment Center

Embassy of the Philippines
#5-1 Itaewon-dong,
Yongsan-gu, Seoul, Korea
Tel. (82-2) 798-2502
Fax (82-2) 798-2504
Email:[email protected]
Website: www.dti.gov.ph
DTI Websites
Department of Trade and Industry (DTI) www.dti.gov.ph
Board of Investments (BOI) www.boi.gov.ph
Center for International Trade Expositions & Missions (CITEM) www.citem.gov.ph
Intellectual Property Office (IPO) www.ipophil.gov.ph
Philippine Economic Zone Authority (PEZA) www.peza.gov.ph
Philippine Retirement Authority (PRA) www.pra.gov.ph
Other Websites
Bases Conversion Development Authority (BCDA) www.bcda.gov.ph
Bureau of Customs (BOC) www.customs.gov.ph
Bureau of Fisheries and Aquatic Resources (BFAR) www.bfar.gov.ph
Bureau of Food and Drugs (BFAD) www.bfad.gov.ph
Bureau of Internal Revenue (BIR) www.bir.gov.ph
Central Bank / Bangko Sentral ng Pilipinas (BSP) www.bsp.gov.ph
Chamber of Furniture Industries of the Philippines (CFIP) www.cfip.org.ph
Clark Development Corporation (CDC) www.cdc.com.ph
Department of Agriculture (DA) www.da.gov.ph
Department of Environment and Natural Resources (DENR) www.denr.gov.ph
Department of Finance (DOF) www.dof.gov.ph
National Economic and Development Authority (NEDA) www.neda.gov.ph
National Statistical Coordination Board (NSCB) www.nscb.gov.ph
Philippine Tariff Commission www.tariffcommission.gov.ph
Philippine Chamber of Commerce and Industry (PCCI) www.philchamber.com
Philippine Exporters Confederation (PHILEXPORT) www.philexport.ph
PHIVIDEC Industrial Authority (PIA) www.phividecauthority.com.ph
Securities and Exchange Commission (SEC) www.sec.gov.ph
Semiconductor & Electronics Industries in the Philippines (SEIPI) www.seipi.org.ph
Subic Bay Metropolitan Authority www.subic.com



YEAR 2004 2005 2006 2007 2008

GDP (US$ bn)

86.9

98.9

117.6

144.1

168.6

Real GDP growth rate (%)

6.4

5.0

5.4

7.2

4.6

Inflation rate (%)

6.1

7.2

6.0

2.8

9.3

Exchange rate (US$:PhP)

56.04

55.08

51.31

46.15

44.44

Merchandise exports fob (US$ bn)

39.7

41.2

47.4

50.4

49.0

Merchandise imports fob (US$ bn)

44.0

47.4

51.8

55.5

56.7

Total investments (PhP bn)

221.8

231.2

357.0

385.8

443.0

Foreign direct investments (PhP bn)

173.9

95.8

165.9

215.2

154.2(3Q)

Total external debt (US$ bn)

54.8

54.2

53.4

54.9

53.5

Gross international reserves (US$ bn)

16.2

18.5

23.0

33.7

36.1

Overseas Filipinos remittances (US$ bn)

8.5

10.7

12.8

14.4

16.4

Population (mn)

83.6

85.3

87.0

88.6

90.3(e)

Unemployment rate (%)

11.0

11.3

8.1

7.8

7.4

Principal exports semiconductors & microelectronics, transport equipment, copper products, petroleum products, apparel and clothing, coconut oil, fruits
Principal markets USA 18.3%, Japan 16.5%, Netherlands 10.1%, China 9.8%, Hongkong 7.8%, Singapore 7.3%, Malaysia 5.6%, Taiwan 4.3%
Principal imports electronic parts & components, mineral fuels, machinery & transport equipment, iron & steel, textile fabrics, grains, chemicals, plastic
Principal suppliers USA 16.3%, Japan 13.6%, Singapore 8.5%, Taiwan 8.0%, China 7.1%, Korea 6.2%, Saudi Arabia 5.8%



YEAR TOTAL TRADE EXPORTS TO KOREA IMPORTS TO KOREA

2004

3,853

1,113

2,740

2005

3,685

1,391

2,294

2006

4,625

1,407

3,218

2007

5,062

1,784

3,278

2008

5,483

2,521

2,962

Merchandise Trade in US$ million
Top Philippine Exports To Korea

Copper cathodes
Electrical capacitors
Diodes - semiconductor devices
Integrated circuits & microassemblies
Parts & accessories of office machines
Coconut oil cake
Fresh bananas

Top Philippine Imports From Korea

Integrated circuits & microassemblies
Petroleum, gas & oils
Watch components
Molding components
Parts & accessories of office machines
Fabrics, textiles
Motor vehicles

Philippine Products And Services For Promotion in Korea

Electronic parts & components
Garments & fashion accessories
Food products
Giftwares, house accessories, holiday decors
Organic & natural products
Construction materials
IT services, ESL training

OVERSEAS BUSINESS REPORT : THE PHILIPPINES*


Filipinos have become accustomed to 2 Korean phenomenal waves: first is “halyu”, Korean soft power that has captivated strong followings in other Asian countries as well and second, the big wave of Koreans that come to the Philippines to work, visit, live or study. In 2008, there were about 1,000 Korean companies doing business along with over 630,000 tourists, 92,000 residents and retirees, and 100,000 students learning English during their school breaks. Why the Philippines?


*Philippine Trade & Investment Center, Embassy of the Philippines in Seoul 15 June 2009



Human Resources

The Philippines is the world’s 3rd largest English ? speaking country of 90 million people, friendly to foreigners and long exposed to western culture. Mostly Christians of mixed Indo-Malay, Chinese and Spanish background with 94.6% literacy rate and 70% English proficiency, they are highly-trainable, creative and adaptable to the demands of global markets for goods and services. The country has a young and robust population with a median age of 22.5 years that grows by 1.95% annually. Total labor force is 36.8 million. In 2008, there were over 405,000 college graduates of whom 85, 000 were in IT, computer sciences and engineering; 110,000 in commerce and business, and 42,000 in medicine and allied/natural sciences.


Strategic Location

Situated in the heart of Asia, the world’s fastest-growing region and gateway for international shipping and aviation, the Philippines is within 4 hours flying time to key Asian cities. It is the closest southeast Asian country to Korea and takes only 3.5 hours to fly from Seoul to Manila. Shipping time from there to key seaports in Asia are within 48 hours. With Korea-ASEAN FTA and the ASEAN Free Trade Agreement (AFTA) in place, it is a suitable distribution hub that can service the 570 million ASEAN consumers and the 90 million Philippine domestic market.


Abundant Resources

The Philippine archipelago has diverse natural resources, from land to marine to minerals. It is the biggest copper producer in southeast Asia and among the top gold producers in the world. It has 300,000 hectares of rich arable land and 7,107 tropical islands with 36,000 km of coastlines of beautiful beaches and breathtaking sceneries. Located inside the Southeast Asian marine diversity triangle, it has the highest concentration of marine life on earth, home to 2,145 fish species that are 4 times those found in Bahamas.


Hospitable Lifestyle

Tropical setting of sun, sea and sand with western amenities, the Philippines is second home to expatriates who enjoy the company of friendly people, varied cultures and global outlook. It offers accessible and affordable housing, medical, shopping, and recreational facilities. It has first-rate educational institutions including international schools and English-language training centers that are recognized for quality and good value.


Librealized Investment Climate

The Philippines is an open economy that allows 100% foreign ownership in almost all sectors. It operates a Build-Operate-Transfer (BOT) investment scheme for large infrastructure projects that other countries emulate. Government corporations are being privatized and key industries have been liberalized and deregulated. These are: aviation and shipping, banking and finance, manufacturing, mining, petroleum, power, retail trade, water and telecommunication. Incentives for several sectors include income tax holidays, reduced corporate income taxes for those in special economic zones, and tax and import duty exemption of capital equipment and raw materials. Over 400 multinational companies that register for regional headquarters are entitled to tax exemptions and tax and duty-free importation of specific equipment and materials.




The Philippine economy had a sustained growth for 31 consecutive quarters. With an average GDP growth rate of 5% from 2001 ? 2007, it managed a record high of 7.2% in 2007. With global recession however, GDP growth rate slowed to 4.6% in 2008 and 0.4% in the first quarter 2009. The government expects it to expand 0.8 ? 1.8% in 2009 while the IMF projects a decline of 1%.


Philippine exports and imports expanded continuously from 2001 to 2007. Exports topped $50.4 billion in 2007, fell to $49 billion in 2008 and is expected to decline by 2.9% in 2009. Imports, on the other hand, still grew to an all-time high of $56.7 billion in 2008 but is likely to fall in 2009. Total investments reached a high of PhP 443 billion ($9.7 billion) in 2008 while foreign direct investments softened to PhP 154 billion in 3rd quarter 2008.


Remittances from overseas Filipinos, growing 17.9% annually from $8.5 billion in 2004 reached $16.4 billion in 2008. This, together with an estimated $6 billion revenues from business process outsourcing (BPO) and tourism revenues of $5 billion, is credited for strengthening the peso to PhP 44.44 against the US dollar. The Philippines continued to prepay foreign debts and pared it down to $53.5 billion. Gross international reserves at $36.5 billion in 2008 was 125% higher than $16.2 billion in 2004. It is estimated to reach $40 billion in June 2009.


High fuel and food prices drove inflation to a decade-high of 9.3% in 2008 . Core inflation began to ease from November 2008 and was down to 3.3% in May 2009. The government inflation target for 2009 is 2.5% - 4.4% and the IMF predicts it to fall to 3.25%. Unemployment eased somewhat from 7.8% in 2007 to 7.4% in 2008 but kicked up to 7.7% in January 2009 following 120,000 job losses in exports manufacturing. The government launched an ambitious Economic Recovery Plan (ERP) stimulus package equivalent to 4.1% of GDP and postponed its balanced budget goal to 2011. Budget deficit for 2009 is expected to reach 3% of GDP.




Total trade between the Philippines and Korea have increased significantly from $12 million in 1965 to $5.5 billion in 2008. Korea is now the Philippines’ 7th largest trading partner, its 7th export market and its 7th import supplier. Korea consistently enjoys the trade balance as it exports higher-valued manufactures.


Philippine exports to Korea consist mainly of copper products, electronic parts and components, coconut feedstuffs, fresh fruits, and marine products. The Philippines is the dominant supplier of fresh bananas, pineapples and mangoes in Korea. The growing number of Korean residents, tourists and students traveling to and living in the Philippines will create more demand for Philippine goods and services. Together with the 50,000 Filipinos living in Korea and the growing interest of Philippine companies on Korea, more Philippine products will find their way in the Korean market. These will include: ice cream, snacks, biscuits, confectionery, spices and condiments, organic and natural food and personal products, fashion accessories, furniture, gifts and housewares and construction materials. IT-enabled services like back office operations, ESL language training, animation and games development, engineering design and architectural services will also expand as Korean companies access them for their Korean and overseas markets.


Philippine imports from Korea consist of electronic parts and components, watch components, petroleum, gas & oils, textile fabrics, chemicals and motor vehicles. Electronics will continue to dominate the exchange of goods as Korean companies and other multinationals expand their operations in the Philippines for assembly and re-export to Korea and other countries. Shipbuilding components and automotive parts will become major products for trade as Korean companies expand their operations in the Philippines. There are good prospects for Korean companies using the Philippines as logistics hub to distribute products to ASEAN, China and others.




Korea is now the 3rd largest source of foreign direct investments (FDI) in the Philippines, accounting for 14.7% of the total approved by the Board of Investments (BOI) and the Philippine Economic Zone Authority (PEZA) in 2008. Over 1,000 Korean companies operate in the country of which 234 are located in special economic zones while others are found in Clark and Subic freeports. Total Korean FDIs from 2004 to 1st quarter 2008 reached $2.3 billion, next only to the USA ($2.7 billion) and Japan ($2.5 billion). The ASEAN-Korea Investment Agreement signed in Jeju on 02 June 2009 will further encourage and protect Korean investments in the country. To assist Korean SMEs investing in the Philippines, Korea’s Small Business Corporation (SBC) maintains the Korean Desk at the BOI.


Notable Korean investments in the Philippines include the $1.7 billion shipbuilding operations of Hanjin Heavy Industries & Construction in Subic; KEPCO with 3 generating plants that account for 12% of Philippine power supply; Samsung Electronics manufacturing and logistics operations; LG in mining and, a growing number that build and manage golf courses, hotels and tourism facilities.




Energy - Green Power

For 2008 - 2017, the Philippines requires additional 5,128 MW of power. Together with the 3,805 MW being offered for privatization, a total of 8,933 MW are available for investments. Up to 2014, it will build 41 hydropower and 62 geothermal plants. Potential energy sources for development are: geothermal ? 2,600 MW; hydro ? 13,000 MW; wind ? 76,000 MW; tidal ? 170,000 MW. Special laws - the Renewable Energy Act RA 9513 and the Biofuels Law RA 9367 ? give income tax holidays, tax exemptions and other incentives to investors engaged in renewable energy, feedstock supply and production of biofuels. In 30 May 2009, the Korea ExIm Bank and the BOI signed an MOU to promote investments in renewable energy projects. In 31 May 2009, KOTRA signed an MOU with the Department of Environment and Natural Resources to assist Korean investors in Clean Development Mechanism (CDM) projects that involve renewable energy.


Tourism, Health and Retirement

The number of tourists have grown to over 3 million in 2008 and Korea was No. 1 with over 630,000. Koreans now comprise 46% of foreign retirees living in the country. As the number of Korean tourists, students and residents on long-term stay are expected to increase, the Philippines encourages investments in tourism estates, hotels, tourist buses, resorts, hospitals and medical centers, retirement homes and villages that will serve their needs. Its retirement program allows multiple entry, indefinite stay and ownership of condominiums for second homes. Medical tourism is increasing as the country gets known for quality, caring and competitive health service.


Mining and Miineral Processing

The Philippines is the 5th most mineralized country in the world. In terms of mineral potential, studies show that it ranks third in gold, fourth in copper, fifth in nickel and 6th in chromite. Its total untapped mineral deposits is estimated at $850 billion. In the next five years, gold production is expected to double and copper to expand four-times the 2007 levels. The Mining Act of 1995 allows foreign investments in large-scale exploration, development and utilization of minerals, petroleum and other mineral oils. Incentives to foreign investors include income tax holidays, exemption from real property and other taxes, net operating loss carry-over and accelerated depreciation.


Agribusiness Development

Agriculture, forestry and fisheries employ over a third of the labor force and account for 15% of GDP. Arable land in the Philippines is 11 times bigger than Korea. With 2 to 3 crops per year in tropical climate, huge opportunities exist for commercial production and processing of agricultural and fishery products. These include food and non-food crops such as jatropha for biofuels and covers cold storage and post-harvest facilities, packaging, feed milling, farm equipment and agrochemical production. PEZA encourages the establishment of agroindustrial economic zones.


Infrastructure

Besides power projects, these include: Comprehensive and Integrated Infrastructure Program (CIIP) Public Private Partnership projects. These are being implemented by the government with private partnership on BOT and other derivative funding schemes and include large projects such as expressways and tollways, mass transit systems, airports, seaports and bulk water supply. Aside from CIIP, other projects include industrial and economic zones, low-cost housing. IT parks and buildings.


Information Technology and Outsourcing

Growing despite global economic slowdown, these include: call/contact centers, business process outsourcing (BPO/KPO), software development, animation and games development, engineering and architectural design. These services are suitable for Korean companies that have large projects in 3rd countries such as engineering works in the Middle East or for technical support in America. The animation talents in the Philippines remain untapped by Korean companies.


Export Manufacturing

Export-oriented enterprises are encouraged to set up preferably in economic zones and the freeports of Clark and Subic. A large number of existing locators are in electrical and electronics, automotive, textiles, metals fabrication, rubber and plastic products. Logistics, warehousing and distribution companies are also allowed to service clients in ASEAN and other Asian markets.



Contact Details


Philippine Trade and Investment Center
Embassy of the Philippines, Seoul
Tel: 822-798-2502; Fax 822-798-2504
Email: [email protected]
Website: www.dti.gov.ph


Korea Desk
Board of Investments, Philippines
Email: [email protected]
Website: www.boi.gov.ph


KOTRA Manila
Korea Business Center, Manila
Email: [email protected]