09

Promote Trade
and Investments
CHAPTER 9

Promote Trade and Investments

Over the medium term, the trade and investment sectors will be strong and positive contributors to overall
national growth. This will require taking more informed risks and making harder choices to propel the
country’s global position upward. To meet these ambitions, both the public and private sectors, together
with major social partners, will act as one, and powerfully recharge trade and investments as motors of
job creation, skills development, and poverty reduction.
This chapter presents the challenges facing trade and investments and the twin outcomes to be pursued
to address these challenges during the Plan period. These outcomes are: (a) global position of Philippine
export sectors restored, sustained, and strengthened; and (b) total investments increased and targeted to
boost trade, skills upgrading, and sustainability.

Assessment and Challenges

Philippine exports have lost tremendous immediate neighbors, stunted the dynamic
ground in the global market (See Figure 9.1), shifts away from low value-added tasks in the
averaging only 4 percent growth for the last global value chains (GVC), and limited the
two decades while our regional neighbors diversification of the product space toward a
have been experiencing exponential growth more complex set of exports. Compared to the
in their exports. The inability of the country country’s position in the late 1990s, the overall
to exploit the waves of surging foreign direct level of sophistication of Philippine exports is
investment (FDI) in the region has resulted much lower in 2021.1
in widening gaps between the country and its

Figure 9.1 Philippine export and foreign direct investment performance relative to the Association of
Southeast Asian Nations, 2000–2020 (USD billion)
Goods Exports Foreign Direct Investment
70.0

300 60.0

250 50.0

200 40.0

30.0
150
20.0
100
10.0
50
0
0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 -10.0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Indonesia Malaysia Philippines Thailand Vietnam Indonesia Malaysia Philippines Thailand Vietnam

Source: World Bank. World Integrated Trade Solution. https://wits.worldbank.org/

Notwithstanding the sharp drop of trade and (COVID-19) pandemic, the Philippines
investment due to the coronavirus disease has managed to increase its exports of

Chapter 9 Promote Trade and Investments | 201

goods in 2021 by 5 percent relative to 2019. threaten services jobs that are routine and
However, this still puts the country behind have weak creative or interpersonal demand.4
five other Association of Southeast Asian While the Philippines could potentially be
Nations (ASEAN) countries. Philippine well placed to exploit the current boom in
exports amounted to only 31 percent that of trade in intermediate services, the overall low
its closest regional competitor, Indonesia. level of skills ensures that growth will mostly
Exports of agriculture have been stagnant at likely be concentrated in few highly urbanized
around USD5-6 billion since 2013, which is areas, consequently leading to limited national
on average 32 percent that of Vietnam during impact on the rates of productive employment.
the same period. Services exports fare better,
growing at an average of 9 percent from The main market access barriers today are
2016 to 2019, and ranking fourth in ASEAN, the high standards that exporters must meet
behind Singapore, Thailand, and Malaysia.2 in terms of consumer health and safety,
However, compared to pre-pandemic levels in environmental protection, and overall
2019, services exports dropped 18 percent in product quality. The country’s relatively
2021. As for FDI, 2021 was a record year that cheap wages are no longer sufficient to carve
saw investments reach USD12.4 billion, which a niche in the global market. Enhancing the
is 21 percent higher than the previous peak country’s ability to meet such standards is
in 2017. Yet, despite what seems to be robust crucial to supporting the efforts of local firms
growth, the country still lags behind, ranking to venture into new export markets, and being
7th in FDI flows into ASEAN in 2021. considered as preferred suppliers to lead firms
in GVCs. Without know-how and access to
The number of jobs that are created by trade and standards and certification testing facilities
FDI is difficult to ascertain due to insufficient nationwide, local exporters will be unable
or unmatched data, e.g., between the Philippine to exploit premium prices in organic goods,
Standard Commodity Classification and the produced according to environmentally and
Philippine Standard Industrial Classification socially responsible practices, for instance.
data. The latest 2018 enterprise census data
A particular concern is the weak or falling
indicated that employment (and the number
export growth rates of the most firm-populous
of enterprises) in sectors linked to exports
sectors. The survival of these sectors, such as
have fallen or at best, remained stagnant
garments, handicrafts, and wooden products,
compared to 2012. The List of Establishments
is imperative since they have strong domestic
reported only a meager 0.2 percent increase in
sectoral and labor market linkages. The
small enterprises and 0.8 percent net annual
Philippines needs to recover competitiveness in
increase in medium-sized enterprises from
sectors where the country has registered clear
2012 to 2021. This is due to the falling rates
comparative advantages in the recent past, as
of new entry of firms in the export markets,3
well as maintain the country’s remaining lead
and the increasing trend toward automation
in the global market (See Figure 9.2).
and robotization, which adversely affect the
capacity of industry to generate jobs and

202 | Philippine Development Plan 2023-2028

Figure 9.2 Philippine Product Dynamics: New Entry and Permanent Exit of Export Products, 1996–2019

500

400

300

200

100

0
96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19

new entry permanent exit

Note: Estimates based on Harmonized System at the 6-digit level.

Source: World Bank. World Integrated Trade Solution. https://wits.worldbank.org/

Public export financing schemes are GVC subsidiaries, which account for more
fragmented, insufficient, or inadequately than 60 percent of the country’s exports, are
communicated. Despite available financing often well sheltered from market shocks and
facilities from the Development Bank of the competitive pressures by their lead firms. Many
Philippines, Land Bank of the Philippines, and local firms, however, will not survive in the
the Small Business Corporation, a number presence of extensive domestic market failures
of Philippine traders still resort to private such as lack of critical infrastructure, access to
financing, which carry higher costs and add financing, real-time market information, etc.
to their cost disadvantage relative to their
foreign competitors. 5 Exporters are relatively The country’s weakening ability to develop
low-risk and thus are prime clients of private and retain a skilled workforce. The 2022
banks since they typically supply on invoice Global Talent Competitiveness Index of
to trusted buyers (i.e., with repeat orders). INSEAD saw the Philippines ranking 80th
The lack of buffers to bridge finance their out of 133 countries (down 10 spots from
transactions often leads to undue burden that 2021). This may undermine the country’s
impact their production capacities. first-mover advantage in information
technology–business process outsourcing
Proactive policies that render timely commercial services, and affect its ability
interventions and preventive measures to secure high value-added niches in
for distressed firms are lacking. In a highly intermediate services. This will also affect
competitive global market, even the market the country’s ability to achieve inclusive
shares of the country’s strongest home-grown growth. The institutionalization of major FDI
export pillars are contestable. Signs of firm reforms in 2022 is expected to significantly
distress must be recognized, else the only improve the investment environment, but
remaining option is firm closure, which not fundamental problems remain pertaining
only leads to job loss but also to the wastage to red tape especially at the level of local
of scarce local entrepreneurial capital. Large

Chapter 9 Promote Trade and Investments | 203

government units (LGU); insufficient infrastructure (e.g., electricity, transport
coordination of investment promotion efforts; networks, telecommunications). These issues
scarcity of local suppliers that are able to need to be addressed to raise the attractiveness
deliver the necessary quality and scale; and of the country as an FDI destination relative
overall high costs of doing business due to to neighboring countries with similar
inadequate and inefficient provision of key endowments and level of development.

Strategy Framework
Amid a crowded policy agenda and limited and domestic markets to drive productive
fiscal space, priorities must be made, especially employment, and increase incomes. On the
at the national level, and innovation in policy other hand, FDI will be harnessed as drivers
approaches are needed, especially at the local of export growth, sources of vital technology,
levels (See Figure. 9.3). On one hand, renewed and critical enablers of the country’s long-term
focus will be given to the survival, growth, climate action.
and expansion of local firms in the export
Figure 9.3 Strategy Framework to Promote Trade and Investments

TRANSFORM PRODUCTION AND SERVICES SECTORS TO GENERATE

MORE QUALITY JOBS AND COMPETITIVE PRODUCTS AND SERVICES

PROMOTE TRADE AND INVESTMENTS IN GOODS AND SERVICES

GLOBAL POSITION OF PHILIPPINE EXPORT SECTORS TOTAL INVESTMENTS INCREASED AND TARGETED TO BOOST
RESTORED, SUSTAINED, AND STRENGTHENED TRADE, SKILLS UPGRADING, AND SUSTAINABILITY

Resolve key constraints to export growth and Maximize synergy and decisively align national and local
competitiveness government investment promotion strategies
Proactively monitor and implement preventive measures and Launch an aggressive “make it happen in the philippines”
interventions for distressed firms campaign and raise awareness of the new business climate
Implement targeted, more granular strategies to increase ushered in by most recent structural reforms
exports on three fronts: global value chain (GVC) export Leverage the Strategic Investment Priority Plan (SIPP)
clusters (industrial, manufacturing, and transportation [IMT], Heighten the country’s attractiveness for foreign direct
technology, media, and telecommunications [TMT], and investments (FDI) by developing unique locational assets
health and life sciences [HLS]); food and agri-marine; and especially in the rural areas
labor-intensive manufacturing Position the Philippines as a prime destination of foreign
Significantly diversify exports by fortifying the sectoral investments against climate change or environmental, social,
backward and forward linkages and governance (ESG) investments
Advance purposive, assertive, and forward-looking Regional
Trade Agreements strategies Re-configure public-private social partnerships to build
Position the Philippines as the foremost supplier of tradeable strong collaboration infrastructure that will serve common
intermediate services investment promotion campaigns, and longer-run joint
Ensure integrated, whole-of-government commitment to strategies to improve the country’s business climate
deliver broad access to National Quality Infrastructure

Integrate private and public efforts to develop the country’s

unique selling proposition and its positioning

204 | Philippine Development Plan 2023-2028

Strategies
Outcome 1: Global position of Philippine export sectors
restored, sustained, and strengthened
Resolve key constraints to export market information sharing to and from trade
growth and competitiveness and agricultural attaches, and diplomatic posts.

The country’s high-cost business environment Proactively monitor and implement

due to high electricity costs and logistics costs preventive measures and
relative to other ASEAN countries must not interventions for distressed firms
be further saddled by unnecessary regulatory
costs. The government will therefore ensure The government will design and implement
tight collaboration with LGUs (this will an effective Early Warning System;7 Rapid
be a special focus of the Anti-Red Tape Assistance mechanisms; and farsighted
Authority), stricter timeframe for resolving preventive measures to support export pillar
exporters’ issues to reduce exporters’ costs, sectors as well as micro, small, and medium
full implementation of the TradeNet platform, enterprises (MSME), which are in critical
and institutionalization of a dedicated unit to stages of transition (e.g., local to foreign
oversee the implementation of the National markets; scale shifts). This requires immediate
Single Window. To facilitate the flow of trade in solutions to the information bottleneck
goods, the government will review, identify, and caused by existing data confidentiality
recommend the removal of regulatory measures laws and fortressed data silos within the
that have become irrelevant, trade-restrictive, government. In the meantime, the Philippine
and costly or burdensome in doing business. Statistics Authority will ensure the updating
The government will also capacitate exporters of its merged Trade Transaction and Firm
to increase their online presence and make use Survey database, which will be the basis for
of digital platforms6 that will increase market distinguishing more granular firm typologies
presence of Philippine goods and services. The and monitoring the health of local firms,
government will likewise review the efficacy particularly exporting firms. Armed by such
of existing financing facilities to further lower firm typologies, the Department of Trade
exporters’ costs and raise their competitiveness. and Industry (DTI) will be able to determine
the reasons behind the weak survival and
The provision of real-time market information falling net entry of firms in the export
is a critical assistance for the country’s markets, and to identify unnecessary cost
exporters. The Tradeline Philippines will be pressures (e.g., informal fees in ports and
revamped and given more resources to enable LGUs). This will be the basis for developing
the platform to identify emerging products customized programs, especially for sectors
and market opportunities; better capture and firms in distress, as well as support
information on local suppliers and their measures to assist exporters in maximizing
capabilities; and create a dedicated space for opportunities in key markets.

Chapter 9 Promote Trade and Investments | 205

Implement targeted, granular Significantly diversify exports by
strategies to increase exports fortifying the sectoral backward and
on three fronts: global value forward linkages
chains, food and agri-marine, and
The shrinking export product space will be
labor-intensive manufacturing
transformed by identifying and supporting
Multiple priorities signal no priorities; thus, local firms that have trigger roles in linking
strategies will be further sharpened to make upstream and downstream sectors in the
them credible for local and foreign investors. economy. The agri-processing sector, for
Given the tight fiscal space for the provision of instance, is populated by these types of
incentives and subsidies, the government will firms. Middle-sized enterprises, for instance,
draw the most specific information possible often fall through the policy cracks,8
to identify concrete entry points for local explaining their trivial net 0.8 percent annual
firms in GVCs (industrial, manufacturing, increase in number.
and transportation; technology, media,
and telecommunications; and health and The servicification of manufacturing and
life sciences). This entails the scanning of agriculture has now been known to increase
opportunities benchmarked on an in-depth the competitiveness of exports.9 This will
(and honest) analysis of the country’s entail the expansion of government agencies
current skills set and not only on the assistance and work toward implementing
GVC’s technological profile. The Philippine these in the regions, such as DTI’s Shared
Export Development Plan will outline the Services Facilities to include common
specific strategies to promote development business services (e.g., marketing,
of identified sectors. digitization, administrative and finance,
promotions, logistics, distribution, assistance
Due to the utmost goal of generating jobs, in consolidation), especially for MSMEs and
especially for unskilled workers, renewed cooperatives with potential export transitions.
focus and targeted support programs will be Value chain interventions will go beyond
implemented for agri-marine-based and labor- mere provision of physical inputs but focus on
intensive manufacturing, such as processed organizational development, and brokering
food and garments. Problem-oriented multi-sectoral partnerships to capacitate
coordination mechanisms, especially in smallholders and make value chains inclusive.
the rural areas to address context-specific
bottlenecks, will be actively utilized as an Concrete indicators will be developed to
approach to resolve these constraints as well as gauge the ability of local suppliers to replace
address general problems of inadequate access a significant share of inputs imported by
to financing and insufficient provision of GVC subsidiaries. This requires: (a) firm
agricultural extension to transform antiquated and sector analysis based on the least
production practices. cost disadvantage relative to benchmark
estimates of foreign competitor positions; and
(b) close collaboration with the private sector,

206 | Philippine Development Plan 2023-2028

particularly with professional specialists’ puts the competitive position of our local
groups (e.g., engineers, research and manufacturers at risk, especially vis-à-vis
development practitioners). countries with an FTA with the EU
(e.g., Vietnam). The government will therefore
Advance purposive, assertive, actively seek derogations for EU GSP+ and
and forward-looking free trade similar mechanisms (e.g., cumulation),
agreement strategies pursue liberal rules of origin for products
A Free Trade Agreement (FTA) Sustainability of interest, and seek inclusion of export
Impact Assessment and FTA Utilization pillars in zero tariffs product liberalization
System will be institutionalized and led by the of countries’ FTAs.
DTI to define short-, medium- and long-term
Conformity to technical regulations and
opportunities in specific sectors and markets
sanitary and phytosanitary standards usually
as well as provide easy access for timely data
comprise an important hurdle for exports to
on trade in goods and services and utilization
enter foreign markets. This challenge will be
of Philippine FTAs. The assessment will aim
transformed into an opportunity by using FTA
to scan other potential high-impact FTAs and
partnerships to help the country strengthen its
other related trade agreements, highlighting
National Quality Infrastructure (NQI) to the
specific areas where these may act as catalyst
benefit of local producers. The government will
for facilitating trade and investments from
negotiate sharing of knowledge, technology,
target-source countries. This assessment
and best practices to comply with standards
will also identify possible stakeholders and
in foreign markets and maximize the market
industries that will be adversely affected
access offered through FTAs.
and accordingly formulate safety nets for
these sectors. The system, on the other hand, Position the Philippines as the
will assist government and relevant private foremost supplier of tradeable
stakeholders in designing programs and intermediate services
activities to promote FTAs and optimize
utilization by exporters. The country has a first-mover advantage in
some tradeable services sectors in the region
Trade negotiations will be employed as a and makes it well-placed in being a hub for
decisive tool in pushing the frontiers of sectors with high creative and interpersonal
our markets as defined by current origin demand. This would entail a credible and
rules. FTA negotiations will also be utilized coordinated commitment both from the
to distinguish between legitimate and private and public sectors to invest in the
trade-restricting non-tariff measures. rapid development of digital skills in order
The double transformation rules of origin to build a concentration of digital talents in
requirements of the European Union (EU) the country. To secure first-mover gains and
hampers the local garments sector’s utilization take advantage of future lucrative niches in
of the highly advantageous EU Generalised creatives and digital skills, the government, in
Scheme of Preferences+ (EU GSP+). This close partnership with the private sector and

Chapter 9 Promote Trade and Investments | 207

academe, will identify where the first-mover Ensure integrated,
advantages in these sectors lie so these areas whole-of-government commitment
could be developed and appropriate support to deliver broad access to the
mechanisms designed for firms in these sectors. National Quality Infrastructure

The country’s large pool of young digital talents Exports, as well as products geared toward
is a huge asset that needs to be harnessed domestic consumers, must be embedded with
by collaborative (regional) strategies. The more technology, innovation, and skills in
government, by mobilizing its regional growth order for local firms to win market shares in
centers, will create a visible concentration of both global and local markets. The government
digital savvy pool of talents in various parts of will definitively integrate and harmonize
the country. This will entail tight partnerships national standards and certification policies,
among industry players, knowledge institutes, and agencies in order to open up the path
LGUs, and the national government. for many local firms (especially SME) toward
Studies predict that the prime mover of quality-exigent foreign markets. In this regard,
efficiency-seeking foreign investments will the government will strongly pursue passage
increasingly be the availability of digital hubs of the NQI Act and direct relevant agencies
instead of mere low-cost production centers.10 to address institutional fragmentation
Moreover, since local digital talents are being and pursue adoption of harmonized
aggressively poached by other countries, new quality infrastructure.
incentive measures will be designed to try and
arrest this trend.

Outcome 2: Total investments increased and targeted to

boost trade, skills upgrading, and sustainability
Maximize synergy and decisively facilitation strategies are fit-for-purpose, given
align national and local government the current market realities and demands.
investment promotion strategies Pioneering enterprises and promising startups
that utilize advanced technologies will be the
The establishment of the Inter-Agency
primary drivers of job creation and innovative
Investment Promotion Coordination
entrepreneurial culture in the Philippines.
Committee under the Amended Foreign
Investments Act (Republic Act 11647) Launch an aggressive branding
will be hastened in order to integrate all campaign and raise awareness of the
the promotion and facilitation efforts to new business climate ushered in by
encourage foreign investments and make most recent structural reforms
the new investment environment credibly
With the institution of major FDI reforms in
improved for investors. Strong government
2022, an all-out campaign is needed to bring
partnership with the private sector is critical
across the message that a new FDI regime exists,
to ensure that investment promotion and
making the country truly open for business. The

208 | Philippine Development Plan 2023-2028

government will maximize the opportunities bring investments to the countryside. Focus
opened up by the Corporate Recovery and must be given on capacitating LGUs in
Tax Incentives for Enterprises (CREATE) making their localities investment-ready and
Act, the amended Foreign Investment Act investor-friendly, leveraging on the presence
(RA 11647), the Retail Trade Liberalization of growth opportunities, minimal market
Act (RA 11595), and the Public Service Act saturation, and absence of congestion and
(RA 11659), through local and international pollution compared to urban areas.
user-friendly information dissemination
programs, and coordinated communications The government will examine unique
campaign done in collaboration with the public–private partnership (PPP) transaction
private sector and social partners. However, arrangements with the private sector, especially
an equally strong internal campaign is likewise for the agriculture and fisheries (A&F) sector.
needed, especially among LGUs. This will be carried out not only at the national
level (for what can be considered “big ticket”
Leverage the Strategic Investment A&F PPPs), but also PPPs in the A&F sector
Priority Plan that have more localized focus.

Promotion of the Strategic Investment The Local Economic Development and

Priority Plan (SIPP) through sector-focused Investment Promotion Offices in all LGUs
and company-specific promotion in (province, cities, and municipalities) will be
target markets will be intensified. The institutionalized to facilitate and coordinate
implementation of SIPP, pursuant to the local economic development and investment
CREATE Act, will incentivize highly attractive promotion advocacies, policies, programs,
investments and will yield more diversified, projects, and activities.
complex, and sophisticated products and
services in the country. This will likewise Position the Philippines as a
be monitored by an Early Warning System, prime destination of foreign
especially to help increase the realization rates investments against climate change
of approved investments. or environmental, social, and
governance investments
Heighten the country’s
attractiveness to foreign direct The world’s biggest companies have been
investment by developing unique building up their investment funds to offset their
locational assets, especially in the carbon footprints, in the form of carbon credits,
rural areas as failure to do so may arrest their production
growth. There is also an increasing number of
The role of domestic investor firms especially
firms that are linking their financial returns
in rural areas in drawing foreign partnerships
with environmental, social, and governance
in greenfield investments will be strengthened.
norms as a part of their business operations and
To support the thrust toward regional
long-term sustainability strategies. This poses a
development, there is a need to reinvigorate
huge opportunity for the Philippines that could
investment promotion in the regions to
offer environmental, social, and governance

Chapter 9 Promote Trade and Investments | 209

(ESG) investment opportunities, specifically in Natural Resources, DTI–Board of Investments,
the areas of reforestation combined with food Department of Finance, Department of Social
security and sustainable livelihood for buffer Welfare and Development, Department of the
communities. At present, the Philippines does Interior and Local Government, Department
not have a carbon pricing instrument but studies of Energy, Climate Change Commission, and
have been conducted in coordination with Philippines Space Agency), private sector,
the World Bank. The Innovative Payment for academe, and other social partners. The task
Environmental Services (PES) is already being force will spearhead the work in building
piloted in the country, offering a more accessible transparent and credible Standards and
alternative to the United Nations Programme Certification schemes by stimulating dynamic
on Reducing Emissions from Deforestation and institutional entrepreneurship in this arena.
Forest Degradation Warsaw Framework, or UN This will be done in close cooperation with the
REDD+ schemes, among others. Bangsamoro Autonomous Region government
and stakeholders given the availability of large
To make the Philippines a prime destination possible reforested land, and the potential
of ESG investments in the world, an ESG link with the aim of sustaining the peace
Investments Task Force will be established. process, which adds significant value to ESG
This will be composed of the public sector investment instruments.
(e.g., National Economic and Development
Authority, Department of Environment and

Legislative Agenda
Table 9.1 presents the priority bills of the 19th Congress to promote trade and investments.
Table 9.1 Legislative Agenda to Promote of Trade and Investments
LEGISLATIVE AGENDA RATIONALE RESPONSIBLE AGENCY
Outcome 1: Global position of Philippine export sectors restored, sustained, and strengthened

Urgent ratification of the Regional Joining the RCEP will be beneficial to the Philippines to enhance its market Department of Trade and
Comprehensive Economic Partnership access and investments. As of date, only the Philippines has not yet deposited Industry (DTI)
(RCEP) Agreement its Instrument of Ratification to the Association of Southeast Asian Nations
Secretariat. In 2020, RCEP accounted for 30% of the world’s population, 30% of
gross domestic product, 29% of trade, and 33% of global inward investments.a

National Quality Infrastructure (NQI) Establishment of an NQI will help boost best practices and competitiveness. DTI, Department of Science
Act Compliance with standards can be a source of advantage (especially in context and Technology, Development
of e-commerce). This will also facilitate secure market access and utilization Academy of the Philippines
of free trade agreements.

Export and Industry Development Act Amendments to the law will provide targeted and strategic policy, program, DTI
and project support, including non-fiscal incentives, for the development of
local industries toward export competitiveness. Most of the provisions of the
Export Development Act have lapsed already.

Outcome 2: Total investments increased and targeted to boost trade, skills upgrading, and sustainability

Executive Order (EO) for a whole- Issuance of an EO will provide cross-cutting facilitation services for priority
of-government, harmonized, and investments.
structured Investment Facilitation
Mechanism, including resolution
of critical issues and concerns for
identified priority investments.
a
Based on 2020 data (World Bank, ITC TradeMap, UNCTAD World Investment Report).

210 | Philippine Development Plan 2023-2028

Results Matrix
Table 9.2 presents the indicators and targets during the Plan period to promote trade and
investments.  

Table 9.2 Results Matrix: Promote Trade and Investments

TARGETS RESPONSIBLE
BASELINE MEANS OF AGENCY/
INDICATOR
(YEAR) 2023 2024 2025 2026 2027 2028 VERIFICATION INTER-AGENCY
BODY 
Outcome 1: Global position of Philippine export sectors restored, sustained, and strengthened

Merchandise exports 54.2 58.09 61.58 65.27 69.19 73.34 77.74e Bangko Sentral Department
increased (USD billion) (2021)a  ng Pilipinas of Trade and
(BSP) Balance of Industry (DTI)
Payments

Non-electronics exports 32.16 37 42 48.6 56.1 63.3 70.9f Philippine DTI

increased (USD billion)c (2021)b Statistics
Authority
International
Trade
Merchandise
Statistics

Number of commodities 440 480 520 560 600 640 680 World Bank DTI
with revealed comparative (2021) World Integrated
advantage increasedd Trade Solution
database

Services exports increased 33.6 42.85 45.42 48.15 51.03 54.10 57.34e BSP Balance of DTI
(USD billion)a  (2021)a  Payments

Outcome 2: Total investments increased and targeted to boost trade, skills upgrading, and sustainability

Philippine foreign direct 2.7 2–5 2–5 2–5 2–5 2–5 2–5  United Nations DTI–Board of
investment (FDI) to gross (2021) Conference Investments
domestic product (GDP) ratio on Trade and (BOI)
increased (%) Development FDI
and GDP data

Share of PH FDI to total 6 5–10 5–10 5–10 5–10 5–10 5–10 ASEAN Stats DTI-BOI
Association of Southeast (2021)
Asian Nations (ASEAN) FDI
increased (%)

Rank in Organisation for 3rd most Lower Lower Lower Lower Lower Lowerg OECD FDI DTI-BOI
Economic Co-operation restrictive Regulatory
Development (OECD) FDI (2020) Resrictiveness
regulatory restrictiveness Index
index improved

Green, Social, and 6.33 6–8 6–8 8–10 8–10 TBD TBD Securities Department of
Sustainability Bonds issued (Oct 2022) and Exchange Finance
increased (USD billion) Commission
Sustainable
Finance Market
Update
a
Based on BSP Balance of Payments data.
b
Based on PSA data.
c
Refers to total exports excluding electronics exports.
d
Based on Harmonized System at the 6-digit level.
e
Targets based on DBCC projections approved during the 183rd DBCC meeting on December 5, 2022.
f
Based on export projections in the draft Philippine Export Development Plan 2023–2028, subject to revision pending approval of draft PEDP.
g
The OECD FDI Regulatory Restrictiveness Index gauges the country’s statutory restrictions with values ranging from 0 (least restrictive) to 1 (most restrictive).
Countries are ranked from least restrictive to most restrictive where higher numerical ranking indicates more regulatory restrictions.

Chapter 9 Promote Trade and Investments | 211

 See Balaoing, A. and A. Mendoza. 2021. Diversification, Jobs and the COVID-19 Recovery: Exploring Opportunities for Economic Diversification and Productive
1

Employment in the Philippines. Makati City: United Nations Philippines.

United Nations Conference on Trade and Development; ranking based on 2016–2019 annual average levels.
2

From 88% in 1998 to 12% in 2012 (last estimate available).

3

See this Oxford study on jobs most likely to be automated: Frey, C.B. and M. Osborne. 2018. Automation and the Future of Work: Understanding the Numbers.
4

https://www.research.ox.ac.uk/article/2018-10-15-automation-and-the-future-of-work-understanding-the-numbers.
All of the country’s direct regional competitors offer such facility, for example: Export-Import Bank of Thailand, Export Credit Agency in Malaysia, Indonesia EXIM
5

Bank, Export Credit Agency, and Export Credit - Vietnam Development Bank, which are all state-owned.
Such as the ASEAN-wide Self-Certification Scheme; ASEAN Single Window; ASEAN Solutions for Investments, Services and Trade; Philippine National Trade
6

Repository; and ASEAN Trade Repository.

This includes monitoring of firm-level export growth, firm market shares, and market exits (e.g., product and country destinations); job creation impact of trade
7

and investments; and monitoring of revealed comparative advantage. Information on the geographic location of firms is essential to mobilize provincial and
even municipal resources to assist ailing firms.
They are too big to qualify for most government aid (especially during the COVID-19 pandemic), and yet too small to accumulate buffers to weather external
8

shocks and competitive pressures. They also often finance their own participation in trade fairs, as well as expensive standards and certification compliance
measures.
Servicification refers to the increasing use and reliance of manufacturing on services. See, for example: Lodefalk, M. 2015. Servicification of Manufacturing Firms
9

Makes Divides in Trade Policy-Making Antiquated. https://www.diva-portal.org/smash/get/diva2:827797/FULLTEXT01.pdf.

10
See for example, Kearney. 2021. Toward a Global Network of Digital Hubs: The 2021 Kearney Global Services Location Index. https://www.kearney.com/digital/
article/-/insights/the-2021-kearney-global-services-location-index.

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