His Excellency Benigno S. Aquino III
President of the Philippines
During the 12th Semiconductor and Electronics Industries of the Philippines, Inc. (SEIPI) CEO Forum
[November 5, 2010, Heroes Hall, Malacañan Palace]
Thank you. Please take your seats.
Mr. Ernie Santiago; Mr. Dan Lachica—Secretary Domingo is on his way— Secretary Montejo; Director General Lilia de Lima who I’m glad to see is still very well-received by our PEZA locators, and her reappointment is really a non-brainer given all her past achievements; officers and members of the Semi-conductor Electronics Industries in the Philippines; honored guests, ladies and gentlemen.
Before I begin with the body of the speech, I would like to share with you a bilateral discussion I had with Prime Minister Key of New Zealand. I don’t know how many of you are aware that there’s about a billion in trade between our two countries, which means 300 million we export to them, and 700 million that they export to us.
So going into the meeting, I really was trying to fathom how to improve our balance of trade with them. And his first statement was, New Zealand has a total population of about four million, which is roughly a third of Metro Manila. And that was a question I could not overcome. How do you convince them to eat more bananas, more pineapples? Although the hundred million Filipinos have a parity with needs with the 4 million New Zealanders?
Anyway, they have been rendering assistance to us. There are other avenues, especially your field, which again continues to astound me. Every time I have a bilateral talk with any head of state, it seems really it is very palpable that your industry is really the prime motive force for our export sector. (Can I just welcome Secretary Domingo? I have to welcome him ‘cause he will be helping me answer your questions later on.)
I would like to express my warmest gratitude to the Semiconductor and Electronics Industries of the Philippines, Inc. (SEIPI) and its members, not just for inviting me today, but for your trust in and continued support of Filipino manpower. I wish nothing but success in all your endeavors. I have full confidence in SEIPI’s capacity to maximize the economic potentials of your industry in fulfilling our commitment in bringing more jobs to our people and uplifting the quality of their lives.
Let me also take this opportunity to note that the Philippine electronics industry continues to be a major contributor to the economy. From 2000 to 2009, you accounted for almost two-thirds of the country’s total exports, averaging at 64.92%. As of May 2010, investments in the electronics industry were valued at US$418.53 million. The manufacturing sector, which includes the electronics industry, has a 19.38% share in the gross national product for the 1st Semester of 2010. Your industry’s performance has been nothing short of exceptional, and all of these figures are signs of the renewed confidence, expressed by foreign investors, as well as our local entrepreneurs. As your businesses continue to grow, they will employ more people and pay more taxes—win-win for all. Your industry’s success will not only generate employment and financial security for millions of our people, but will also bring additional funds your government can devote to delivering basic services, such as more classrooms or better hospital facilities for our countrymen. Your efforts are a testimony to the new energy in our economy.
Despite the brighter days ahead of us, there are still roadblocks that prohibit us from achieving our dreams of prosperity. One of these is the relatively high cost of doing business in the country, which has been shooing away potential international investors. Our economic stability is dependent upon our capacity to tap other natural energy sources in the country, and in creating a reliable alternative power supply. In line with the Renewable Energy Act of 2008, we have supported the establishment of more sources of indigenous power and green technologies. The recently launched Simbulan Hydroelectric Power Plant in Sta. Cruz, Davao del sur, developed by Aboitiz, is a clear indication of the private sector’s urgent response to our call to address the power situation by maximizing renewable power resources. Aside from this, the Energy Regulatory Commission (ERC) adopted the feed-in-tariff rules which is an incentive mechanism intended to accelerate the exploration and development of renewable energy resources. This will offer guaranteed payments over a definite period of time to developers utilizing renewable energy resources such as wind, solar, run-of-river-hydro, biomass and ocean. We shall also continue to implement the Association of Southeast Asian Nations (ASEAN) Roadmap for the Integration of the Electronics Industry to boost the Philippine electronics industry’s regional advantage among ASEAN member countries.
Our nation has always aspired for an economy where business and government are partners for change. As part of the public-private partnership (PPP) initiative of the government, infrastructure development is given a huge priority. As a result, joint-venture infrastructure projects with the private sector to put up roads, bridges, ports, airports, food supply chain facilities, power and water facilities will soon be underway. Our pursuit towards a strategic collaboration with private entities will not only anticipate the growing need for the expansion of various industries in the country, but will also achieve mutually advantageous goals that will be beneficial to the entire nation, as well as the private sector.
The Board of Investments (BOI), in cooperation with the Japan International Cooperation Agency (JICA), is currently conducting a study on the supply chain of the electronics industry in the Philippines. This aims to identify investment gaps within the supply chain to help the country formulate initiatives towards improving and strengthening supply chain mechanisms in support of the electronics industry. Part of this plan also includes the provision of green projects that lead to the efficient use of energy, natural resources and raw materials, encouraging the use of cleaner and more efficient green technologies to reduce our greenhouse emission. I look forward to your becoming a partner in bidding for rural development and climate change mitigation. As long as our citizens and resources are not taken advantage of, our nation will surely stride towards a better economy and improved lives for our impoverished constituents.
We are determined to strengthen the electronics industry through aggressive investment promotions. The Philippine electronics industry already has a robust standing in Asia, but there is even more potential to reach new heights by looking into exports-oriented foreign direct investments in Japan and the European Union, and participating actively in different international assemblies such as ASEAN and APEC. This also involves enticing emerging markets, such as India and China among others, into investing in our economic zones. Our country’s potential to be a competitive economic player in Asia is dependent upon our ability to shift to a global approach in development and invest in economic partnership agreements with other nations.
We are aware of the effects of the appreciation of the peso not just to the electronics industry but to the export industry as a whole. Our economic managers are looking at ways to cushion our local industries from its impacts. We are also appealing to neighboring developing countries to help mitigate its effects and will continue to do so at the next Asia-Pacific Economic Cooperation (APEC) Senior Officials Meeting in Japan.
Moreover, linking the Philippine academe with leading foreign universities to enhance the Filipino innovators’ competency will also be an additional boost to our manpower. The belief in our ability to produce quality products strengthens our national identity and helps us move forward together. This is why we will continue the Unified Microelectronics Program and the RP-Taiwan collaboration that facilitates training and technical proficiency initiatives to support the demands of the growing electronics industry. It is necessary for us to continue harnessing our own talent pool, and cultivate further the competency, innovativeness, and the techno-entrepreneurship spirit of electronics industry players.
Our determination remains firm. We will break all barriers that hamper the development of your businesses. Aside from eliminating red-tape and under-the-table transactions in the government, we have also vowed to lessen the amount of time and necessary paperwork to start your business. Registration of business names, which usually takes 4-8 hours or even a few days, has been cut down to only 15 minutes. In addition, the testing of products for non-PEZA companies, which takes one month to one year, will also be cut down to a few days. Through the active cooperation between government and private entities, all these efforts are geared towards our pursuit of a progressive, self-sufficient economy.
The positive outlook we now have on the Philippine economy will benefit you and the entire nation in the long run. I thank the SEIPI and its members for your enduring support to our campaign to encourage the advancement of various industries in the country. My administration shall continue its support to businesses like the electronics industry, which is our partner towards economic development. Hand in hand, we will continue to move forward. With the impetus of the newfound and contagious energy of the Filipinos, our destiny of becoming a truly great nation is fully within our reach.