If businesses in the Philippines are still not
ready for the stiffer competition under a regional integrated economy, it’s
nobody else’s fault but their own, an economist said.
Economist
Fernando “Perry” Fajardo said most Philippine businesses are not willing to
have competition due to fear of “dying out.”
“The
question here is: when are we going to be ready? In the 60s and 70s, our
neighbors were ready to conquer the world despite the competitors outside. Now
that it’s 2015, we’re still not ready? It’s no longer the fault of your
competitors if you lose to them. It’s your fault,” Fajardo said in an interview
with reporters.
Instead
of viewing competition negatively, Fajardo said the businessmen should welcome
competition as a challenge to improve the quality of their products and lower
their costs.
So long
as businesses have products that are good quality-wise and cost efficient, they
should have no problem competing with other businesses, Fajardo added.
Aside
from looking at cost efficiency and product quality, businesses should begin
moving from producing for the consumer industry to manufacturing in the medium
to high capital industries.
He noted
that the Philippines is still dependent on machines made outside — even simple
machineries.
“Our
technology is lacking. Kinamot pa tanan (Everything is done by hand). We lack
machine work. Most of our industries are consumer industries. We produce for
consumption. What we lack is to go into manufacturing of intermediate goods. We
are importing tools from China and Korea. Why are we not making them? Then
later we can move to high capital industries like making tractors or large
machineries,” Fajardo said.
He also
noted that businesses that produce only for the domestic market will have a
harder time competing than those that are already exporters and global traders.
“If you
only depend on the domestic market, again that is your fault because this is
now a global economy,” he said.
Philippine
businesses, however, seem afraid to compete in the global market unlike their
counterparts in other countries.
“You
don’t have to be big to conquer the world,” Fajardo said.
“Most
businesses in Europe are small-scale. In Italy, village industries market
globally,” he added.
Nelia V.
F. Navarro, Department of Trade and Industry (DTI) Cebu provincial director,
said micro, small and medium enterprises (MSMEs) that have not ventured into
exports will have bigger challenges under an integrated economy.
“To me,
the AEC (Asean Economic Community) outlooks are both positive and negative.
Positive because the market is big, with an estimated 630 million people in the
Asian region. Negative if you’re not ready for competition and if you’re not
productive enough or if your price points are not competitive,” she said.
In
general, however, Navarro said Cebu is ready for integration.
“Cebuanos
have always traded with other people. They are used to doing that. So Cebu,
compared to other parts of the country, is very much ready for the challenges
the integration will bring,” she said.
Leaders
of the Association of Southeast Asian Nations (Asean) has declared the creation
of the Asean Economic Community, which will become a legal entity on December
31.
Under an
AEC, there will be free intra-regional movement of people, goods and services
with the removal of tariff barriers and visa restrictions.
Vanessa
Claire Lucero
Business & Investment Opportunities
Saigon Business Corporation Pte Ltd (SBC) is incorporated
in Singapore since 1994.
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