Philippines will double Rubber Production for High Domestic Demand

 

The government is looking at doubling the country's 2010 rubber industry production and supply 50 percent of domestic natural rubber requirements by 2016, the Department of Trade and Industry said.

 

DTI Undersecretary Merly Cruz said this is part of the development plan for the industry, which recently got a big boost with the signing of a commitment by government, the financial institutions and the industry stakeholders at the 1st Philippine Rubber Investment and Market Encounter or PRIME 2012 in Clark, Pampanga last September 19.

 

"We envision the Philippines as one of the major natural rubber producing countries in Asia. We are targeting to double the Philippine rubber industry's production in 2010 and supply 50 percent of domestic natural rubber requirements by 2016," Cruz said during the PRIME 2012.

 

"To increase the domestic market share of natural rubber by 50 percent for the next 5 years, we intend to facilitate direct market access to tire and other natural rubber-based manufacturers in the country," Cruz added.

 

 "By 2016, we also aim to increase export of crumb rubber to China and other Asian markets by 25 percent by improving the quality and ensuring compliance to product standards. We also intend to increase production of crumb rubber by 10 percent annually through enhancing productivity through improved and new technology and upgrading dilapidated processing facilities in identified rubber producing regions and provinces," Cruz said.

 

 The DTI spearheaded the signing of the commitment to support the rubber industry's programs, projects and activities in the Philippine rubber industry road map.

 

Rubber Tree Product

Other signatories include the Department of Agriculture (DA), Department of Environment and Natural Resources (DENR), Department of Environment (DENR), Department of Agrarian Reform (DAR), Department of Science and Technology (DOST), Land Bank of the Philippines (LBP), Development Bank of the Philippines (DBP), Philippine Rubber Industries Association (PRIA), and representatives of rubber producers and processors committed

 

The statement of commitment recognizes the extent of market and business opportunities in the country's rubber industry. If fortified, these opportunities are expected to generate investments increase domestic and export sales, and create job opportunities that will contribute to inclusive growth and poverty alleviation.

 

The DTI together with other government agencies facilitate the strategic partnership to formulate and execute the Philippine rubber industry road map. This road map contains long-term goals and short-term strategies that will chart the direction of the rubber industry in the country.

 

PRIME 2012 is first industry event of the country to focus on providing access to market and investment opportunities in the rubber industry. It was attended by participants who are experts, policy makers, rubber producers, processors, traders and exporters, and manufacturers such as Yokohama Tire Philippines Inc. (YTPI) and members of the PRIA.

 

The PRIME 2012 intends to expand the domestic market for natural rubber, provide opportunities for the natural rubber producers and jobs for rubber farmers and industry workers.

 

The statement of commitment to support the rubber industry's development also acknowledges that the rubber industry's growth and sustainability depends on the quality of participation, the competitiveness and equitable sharing of benefits among stakeholders, and the support of national and local agencies, and development partners. It also expresses appreciation to the efforts of key rubber industry players and stakeholders in assessing the industry and recommending policy actions, programs and projects.

 

Further, this statement of commitment also supports the formation of the national rubber inter-agency team that will ensure the implementation and monitoring of the policies, programs, and projects in the rubber industry's road map and other development initiatives that may be identified in ensuing consultations with stakeholders. It also enjoins key players and stakeholders in the industry to strengthen their collaboration to surface concerns, address challenges and push the industry to forward.

 

"As part of our strategy, we also organized the rubber industry cluster team to institutionalize the convergence of the various stakeholders in the rubber industry, and develop the Philippine rubber industry," Cruz said.

 

"Likewise, we will also provide smallholders and cooperatives easier access to financing facilities and strengthen farmer organizations and cooperatives. We also aim to create an environment conducive to the development of the rubber industry by providing support facilities and infrastructures, policy, incentives, and other support services," Cruz added.

 

Manila Bulletin 

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Philippine Economy to grow more Faster by Q3 – Global Investors Pick Philippines

Photo credit: Makati Business Club

Despite the series of typhoons that battered the Philippines in the third quarter, a senior government official said Monday that the country's economic growth could be higher in July to September.

 

National Economic and Development Authority (Neda) director general Arsenio Balisacan said economic growth in the third quarter may surpass the 3.2 percent registered in the same period last year.

 

The Philippine government is banking on the robust performance of the services sector, particularly companies in the local business process outsourcing industry (BPO) to buoy growth.

 

For the whole of 2012, Neda has earlier said that economic growth will likely settle at 6 percent on the back of the good performance of the services sector as well as the increase in public spending.

 

The increase in government spending and the resiliency of the services sector to global economic uncertainties enabled the Philippines to post an economic growth of 6.1 percent in January to June.

 

To achieve a 6-percent economic growth rate, Balisacan said gross domestic product for July to December should grow by at least 4 percent. Enditem

 

Global Investors Chosen the Philippines for their Investments

 

 The Philippines is one of the current "darlings" of global investors seeking better returns in emerging market economies and offers even bigger potential returns in the future, according to a ranking official of foreign investment firm Religare Capital Markets Ltd

 

The company, which specializes in equities investments in India and the Asean region, has decided to set up operations in the country within the year to better take advantage of the nascent Philippine economic boom.

 

"The Philippines is a market where people want to put money into," Religare's global head of equity capital markets John Sturmey said in an interview with the Inquirer. "The story here is certainly better than how it was a few years ago. Everyone is saying good things about the Philippines."

 

Religare, which has the bulk of its operations in India, Singapore and Hong Kong, is hoping to tap into the growing demand from the local corporate market for investment banking and equity deals.

 

The appetite of local corporations for more capital on both the equity and debt sides jibes with the massive amount of liquidity found offshore as central banks in the United States and Europe try to revive their economies with cheap funds, leaving investors awash with cash and few options for better returns in their home markets.

 

"Investors are looking for places where they can make money," Sturmey said, pointing out that Philippine companies used to have initial public offerings worth only $60 million. "Now we see $300-400 million deals," he said.

 

Religare's equities head also said that ongoing challenges being faced by China and Hong Kong—the twin darlings of foreign investors over the past decade—also bode well for alternative investment sites like the Philippines.

 

"Hong Kong and China are offering less opportunities," he said. "They're 'over-banked' since there are a lot more financial institutions chasing after fewer and fewer deals." This has made it less attractive for firms like Religare, which would have to contend with thinning profit margins.

 

At the same time, the China and Hong Kong markets have ongoing difficulties with corporate governance issues, which are encouraging investors to look to other emerging market nations.

 

Previous to its announcement that it would set up shop locally, Religare has already participated in the initial public offering of Puregold Price Club Inc. late last year as a junior partner of lead underwriter UBS (most of Religare's senior officials are former UBS bankers). More recently, Religare also initiated research coverage on local IT gaming firm Philweb Corp.

 

Sturmey said that Religare was particularly interested in the spate of "re-IPOs" being undertaken by local corporations as part of the Philippine Stock Exchange's thrust to increase the free float of listed companies.

 

"These re-IPOs present good opportunities to people like ourselves," he said. "The Philippines has great companies here but they're trading $10,000 a day [in total value turnover]."

 

The Religare official expressed confidence in the local market, saying the country was "in the best place it's been for decades, with a very strong macroeconomy and a solid political situation."

 

"It's always been overlooked for many years, even by the big banks," Sturmey said. "The bigger question is, whether it's sustainable."

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