KEYNOTE ADDRESSSec. Ramon Lopez

Department of Trade and Industry

REMARKABLE MACROECONOMIC PERFORMANCE AND ECONOMIC TRANSFORMATION

First-to-third-quarter GDP growth in 2017 stood at 6.7%, securing

our position as the fastest growing economy in Asia.

Philippines6.7%

Vietnam6.3%

Malaysia5.9%

China6.9%

In 2017, manufacturing exhibited a Q1-Q3 growth of 8.3%.

REMARKABLE MACROECONOMIC PERFORMANCE AND ECONOMIC TRANSFORMATION

5.4%Average Annual

Growth of Servicesin 1990-1992

4.0%

Average Annual Growth of

Manufacturingin 1990-1992

6.8% 7.8%Average Annual

Growth of Servicesin 2013-2016

Average Annual Growth of

Manufacturingin 2013-2016

REMARKABLE MACROECONOMIC PERFORMANCE AND ECONOMIC TRANSFORMATION

Capital Formation8.6%

HouseholdConsumption

5.4%

Government Spending5.3%

REMARKABLE MACROECONOMIC PERFORMANCE AND ECONOMIC TRANSFORMATION

NET FDI INFLOWS

➢ Net FDI inflows fromJanuary to August 2017amounted to US$ 5.1 billion.

REMARKABLE MACROECONOMIC PERFORMANCE AND ECONOMIC TRANSFORMATION

✓ Approved investments by the Board of Investments from Januaryto September 2017 reached PhP 408.7 billion, a 33% increasefrom PhP296 billion in the same period in 2016.

✓ Manufacturing sub-sectors (food, motor vehicles, fabricatedmetal, and wood products) amounted to PhP 38.5 billion or 9.4percent of total.

Manufacturing Summit 2016: “Trabaho at Negosyo”

Establish innovation centers, inclose coordination with DOSTand in collaboration with theacademe and industrystakeholders.

Revise and update ourindustrial policy to take intoaccount emerging disruptivetechnologies like robotics, AI,and 3D printing.

Continue the collaboration andpartnership among thegovernment, academe, andindustry.

Some Updates on the Manufacturing Summit 2016 Proposed Recommendations

• Manufacturing Resurgence Program

• BOI IPP incentives for innovation and R&D

• Formulation of Inclusive Innovation and Entrepreneurship Roadmap

• Inclusive Innovation Conference – DTI-DOST MOU

• “Gearing Up the Regions for Industry 4.0” Regional Workshops

• IPOPHL National Intellectual Property Strategy

• Collaboration on HRD with CHED and TESDA

• DTI-DPWH Roads Leveraging Linkages for Industry and Trade (ROLL IT) Program

• Support for amendments to Public Service Act and BuildBuildBuild

• Pondo sa Pagbabago at Pag-asenso (P3)

• Support for TRAIN; incentives for industry development

• Possible PH-US FTA

Philippine Inclusive Innovation Industrial Strategy (i3S):Propelling Jobs, Investments, and Shared Prosperity for All

Philippine New

Industrial Policy

Inclusive Innovation Industrial Strategy (i3S)

Top 12 Priority Sectors

Major pillars and strategic actions

DTI-DOST MOU

Marikina as a possible innovation center (Plug and Play Model)

Inclusive Innovation Industrial Strategy (i3S)

Overall Goal: Create globally competitive & innovative industries• Growth oriented action to upgrade industries, move up the

value chain

• Remove obstacles to growth attract more investments

• Deepen participation in regional production networks/global value chains

Role of Government: Enabler & facilitator to address coordination failures• Address the most binding constraints preventing industries

from growing

• Create proper environment for private sector development

INDUSTRIAL STRATEGY

INNOVATION

INCLUSIVE

• GVC-focused • Fosters innovation &

entrepreneurship• Cluster-based industrial strategy

Priority Industry Group Specific Industry Areas

Automotive and auto parts large body metal & plastic parts, strategic parts under CARS Program

Electronics/Semiconductors auto electronics, medical devices, telecommunications equipment, power storage, aerospace; IC design, Engineering Services Outsourcing (ESO)

Aerospace & aircraft MRO aerospace parts

Chemicals petrochemicals, acyclic alcohols & derivatives, metallic salts & peroxy salts of inorganic acids, cyclic hydrocarbons, oleo chemicals

Shipbuilding & repair RORO, small- and medium-sized vessels

Furniture, Garments, Creative Industries manufacturing & design

Iron & Steel, Tool & Die manufacturing & design

Agri-business food & resource-based processing (cacao, coffee, mangoes, bananas, coconut, rubber, bamboo, fruits & nuts, & other high value crops)

Construction roads, railways, bridges, ports, airports, & low-cost housing;

IT-BPM and E-Commerce more complex non-voice services BPO, KPO in medical, financial, & legal services; game development; ESO, software development, shared services

Transport & Logistics land, air, & water transport, warehousing, support facilities for transport

Tourism

i3S Five Major Pillars The i3S is based on five major pillars aimed at pursuing strategic actions in coordination with other government agencies, industry, and academe.

Building new industries, clusters, and agglomeration

Capacity-building and human resource development

MSME growth and development

Innovation and Entrepreneurship

Ease of doing business and investment environment

DTI-DOST MOUInclusive Innovation and Entrepreneurship Roadmap

• Strengths, weaknesses, opportunities & threats fromemerging trends in advanced technologies, innovationecosystem

Where are we

• Formulate vision, goals, targets

• Realizing emerging trends in advanced technologies &manufacturing, where we want to go, where are thesweet spots

Where do we want to

go

• How can domestic firms participate in innovative process & capture sweet spots, greatest value from globally integrated process

• Strategic policies & programs: start-ups, MSMEs, large; sectors, activities & locations

• Hard & soft Infrastructure

• Role of stakeholders, coordination mechanism & budget

How to get there

Our vision is for the Philippines to have creative and

connected communities (3Cs) of researchers, innovators, financiers, start-ups, SMEs, large enterprises, government workers, and other

stakeholders who will collaborate to produce new processes, products, and services.

Maraming salamat!Sec. Ramon Lopez

Department of Trade and Industry