Press Releases Archived (May 2014)

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More regionally tailored industry roadmaps need to be put in place to strengthen the viability of local businesses and industries in light of the impending economic integration of the ASEAN economies by 2015.

This was revealed at the regional workshop and consultations on the ASEAN Economic Community (AEC) held at the cities of Cebu, Davao, and Butuan in 2013 and early part of 2014 with research fellows from state think tank Philippine Institute for Development Studies (PIDS) as resource speakers. The AEC forums were organized by the National Economic and Development Authority's Regional Offices 7, 11 and Caraga, in cooperation with the regional development councils and PIDS. The Institute's participation in these regional forums is part of its outreach and extension program.

PIDS Fellow Dr. Rafaelita Aldaba noted that "there is a need for a specific roadmap for each region. There are lots of potentials that can be tapped. The regional development plans may be updated and transformed into a roadmap similar to what the DTI is doing. This will provide regional content or regional dimension to these roadmaps."

"There are cases when a particular sector is seen as promising but is not taking off because of certain government policies. These are part of coordination failures or market failures that are present and which government should need to address. These are also one of the areas where roadmaps are focusing right now," Aldaba who is concurrently Assistant Secretary for Industry Development of the Department of Trade and Industry (DTI) added.

She said government is focusing on job and employment creation and inclusive growth. Even though economic growth has been remarkable in recent years, she noted that in order to sustain this at a high level, "it has to be inclusive and hence the focus on creating jobs".

Aldaba noted that regional consultations are needed to touch base with regional industry officials. These exercises are important "in assessing coordination failures, issues that government should address". She added that this helps in the process of formulating the industry roadmaps. "It is important that not only the manufacturers are consulted but the agriculture sector as well," Aldaba said.

Meanwhile, PIDS Research Fellow Erlinda Medalla assuaged fears about the possible negative impacts of ASEAN integration on local businesses. She explained to regional industry and business leaders that "integration has been going on and there is nothing to fear with the coming AEC in 2015." Presenting an overview of the economic integration and trade facilitation, Medalla described economic integration as a "work in progress". "The concept or idea of an ASEAN Economic Community started a little over two decades ago. AEC has been part of the Philippine trade reality for the past two decades," she said.

Other PIDS research fellows who presented in the regional AEC seminars with Aldaba and Medalla were Dr. Adoracion Navarro (Infrastructure and Logistics), Dr. Roehlano Briones (agriculture), and former PIDS president Dr. Josef Yap (Manufacturing Sector and Inclusive Growth).

Recent reports say an executive order for the roadmaps is set to be signed by President Aquino anytime soon. Industries that submitted roadmaps were the auto assembly and auto parts, copper, chemical, paper, cement, ceramic tiles, iron and steel, biodiesel, electronics, creative, bamboo, shipbuilding, garments and textile, mining, medical travel, processed-food, furniture, mass housing, and IT-BPM.

Tapped by the DTI-Board of Investments, PIDS led in the formulation of a comprehensive industrial roadmap that will facilitate the integration of these different industries, including small and medium enterprises, and transform manufacturing into a major source of growth and employment.


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Efforts to modernize customs administration are expected to create new opportunities for custom brokers who are adept and flexible enough to adjust to changing market conditions.

According to a study by state think tank Philippine Institute for Development Studies (PIDS), custom brokers should realize that efficiency gains from a modernized customs administration will result in a more efficient trade facilitation that can create a higher volume of trade. This will then lead to a new demand for a type of expertise in customs rules and regulations that brokers should possess.

"With the economic integration in the Association of Southeast Asian Nations (ASEAN), the Philippines must successfully implement seamless, efficient, and transparent trading procedures to maximize the potential benefits from such integration," the study noted.

Likewise, as a signatory to the Revised Kyoto Convention or the International Convention on the Simplification and Harmonization of Customs Procedures, the Philippines, through the Bureau of Customs (BOC), is required to institute customs procedures that comply with best practices and standards in the global markets.

PIDS President Gilberto Llanto, one of the authors of the study, pointed out that a significantly growing volume of trade transactions calls for a more transparent and efficient customs administration. Computerization is replacing the traditional and direct interaction of brokers with BOC staff, making services of customs brokers less relevant. In addition, he noted that it will be more efficient and consistent with trade facilitation to allow traders to use various and modern options for releasing or shipping their goods.

However, attempts of policymakers to modernize and introduce efficiencies in customs administration are facing strong opposition from custom brokers who contend that these measures could significantly diminish, if not permanently eliminate, their role in the customs administration process.

Under the present setup, cargoes undergo mandatory assessments by licensed custom brokers. Moreover, only customs brokers can sign the import and export entry declarations.

However, in Section 108 in the proposed Customs and Tariff Modernization Act (filed as Senate Bill 168 in the 16th Congress), anyone"including importers and exporters"can now declare their goods or can designate a person to declare the cargo on their behalf.
Brokers interviewed for the study argue that this will not only endanger their jobs but will also jeopardize the processes, integrity of transactions, and the revenue collections targets of the BOC.

However, while customs brokers see themselves as an essential part of trade facilitation, the direct users do not see any value added from the customs brokers services.

For some import-export firms, mandatory use of customs brokers can be minimized or totally removed without affecting the flow of trade since the bulk of trade facilitation services are actually performed by freight forwarders that are in charge of efficiently transporting goods.

"Since the customs brokers role is merely to formalize the transaction by affixing his/her signature on the documents as required by the Customs Brokers Act of 2004, customs brokerage can be integrated into the services of the freight forwarders," one respondent stated.
Other study respondents also pointed out that minimizing the role of customs brokers can be beneficial to both exporters and importers because this could result in minimizing costs arising from brokerage fees.

"The proposed Customs and Tariff Modernization is expected to introduce greater efficiencies in customs and trade. However, proponents of customs modernization must also recognize that it is necessary to ensure that the proposed bill is not inconsistent with existing laws such as the Customs Broker Act of 2004," the PIDS study suggested.

Finally, the study recommended for BOC and oversight agencies to recognize that the primary indicator used to gauge the BOCs performance is its revenue collection effort and not the revenue collection targets per se.

"They also need to consider that the role of the BOC is evolving under a globalized and liberalized trading environment especially in view of the ASEAN Economic Community where tariff walls will become a thing of the past. A more relevant indicator of performance will thus be the timely and efficient facilitation of the volume of trade," the paper concluded.

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Health sector stakeholders gathered at Xavier University in Cagayan de Oro City to discuss some of the best healthcare innovation practices in a forum organized to encourage adoption of these practices and address persistent disparities in health amid a growing economy.

Four innovative health programs were presented in a roundtable discussion led by the Philippine Institute for Development Studies (PIDS), the government policy think tank tapped by the Washington-based Center for Health Market Innovations for the implementation of the project "Health Market Innovations".

More than 100 participants from local government units, academic institutions, health offices, regional offices of the Philippine Health Insurance Corp., Center for Development offices of the Department of Health, and nongovernment organizations participated in the roundtable discussion last March 6.

PIDS President Gilberto Llanto said health innovations show the creativity of Filipinos in addressing the very large disparities in health. "It is indispensable for the country to deal with the very large underinvestment in health where government health staff stagnated at around 26,000 since year 2000 despite the country`s 1.7 million annual population growth," he said.

"We need to innovate to achieve the Millennium Development Goals (MDGs) for health," said Oscar Picazo, PIDS senior research consultant and board chairman of the Philippine NGO Support Program, Inc. "The Health Market Innovations project builds linkages among health innovators, funders, and policymakers. It also provides information for those who do not know that there are funders for better health care delivery," he added.

One of the health innovations introduced was the EVAcoh Project (Eastern Visayas Area Cooperation in Health). "The project aims to setup and operate social health enterprises using cooperatives` community development funds," said Roberto Nebrida, executive director of the Philippine NGO Support Program, Inc.

The EVAcoh Project considers social health enterprises such as cooperative-based pharmacies as an innovative method of investment in the provision of health services and commodities. "EVAcoh social health enterprises have served a total of 10,348 women of reproductive age," said Nebrida. "Its total sales have reached a whopping PHP6.1 million."

Another innovation, RTI International`s Wireless Access for Health Project (WAH), recognizes the benefits of wireless connectivity in enhancing health care planning and delivery in rural health units (RHU)."The WAH project uses 3G wireless technology to improve health care by reducing time required for data reporting as well as improving access to accurate patient information at the RHU level," said Felipe Canlas, RTI International local project coordinator."It helps rural clinicians spend more time for patient care rather than spending half of their time on patient information recording and reporting," he explained.

WAH has been adopted in 66 RHUs in 38 cities and municipalities and 14 provinces in the country, serving 2,500 patients a day.

Sr. Eloisa David, OSB, chief operating officer of KaKaK Foundation, talked about the Mother Bles Birthing Clinics. The project, which has established 50 clinics since 2010, addresses the lack of access to affordable and high-quality maternity care facilities, helping achieve the country`s MDG commitment of reducing maternal mortality.

"The program promotes the legitimate rights of every mother on maternal health, especially those who are indigent and underprivileged," said Sr. David, a doctor and fellow of the Philippine College of Hospital Administrators.

In post-disaster situations, Xavier University`s Sustainable Sanitation (SuSan) Center provides effective and sustainable sanitation solutions to evacuation centers through the distribution of urine diverting dehydration toilets (UDDTs). Moreover, the collected bio-waste from UDDTs can be recycled and used as soil amendments.

"Every time there is a disaster, people donate clothes, food, soaps, and water, while donating sanitary toilets is always an afterthought," said Gina Itchon, SuSan Center Director. "There was once a big evacuation center where 50,000 people were sharing a single toilet."

At evacuation centers in disaster-hit Northern Cebu and in Tacloban City, the SuSan Center had installed Arborloo toilets, or shallow pits that are abandoned once filled, which can then be planted with fruit or wood-bearing tree saplings.

Fr. Roberto Yap, Xavier University president, said investments in human capital, education, and health are important to make economic growth inclusive. "Health disparities in the country tell us that the traditional way of health care is not enough, and health innovations must be explored," he said.

Celia Reyes, PIDS senior research fellow and health project director, said PIDS` role is to help in knowledge brokering for a more inclusive health care system.

"PIDS is not only interested to showcase best practices on health innovations," Reyes said. "The Institute is willing to help you to link with innovators and with other stakeholders to scale up these health innovations," she told forum participants. #

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In the Philippines, every president has promised to achieve rice self-sufficiency within his or her term. Sadly, this promise has been repeatedly broken and unmet. The current administration, however, hopes to break the trend of broken vows and guarantees 100-percent rice self-sufficiency or zero imports starting 2013 through the Food Staples Sufficiency Program (FSSP). Is this feasible?

Findings from a recent study conducted by the Philippine Institute for Development Studies (PIDS) Senior Research Fellow Roehlano Briones show that the answer to this question is negative. According to Briones, the rice self-sufficiency target is unlikely to be achieved, whether in 2013 or even through the course of the decade to 2020.

At the start of President Benigno Aquino III`s term in 2010, the Department of Agriculture (DA) crafted the FSSP, a coherent plan toward achieving rice self-sufficiency or zero importation starting 2013. To achieve this goal, the budget allocation for the DA has been increased to 55 billion pesos for 2013, a sharp increase compared to its 2010 budget of 33 billion. Much of this budget increase is intended to fund various strategies identified in the FSSP such as improving irrigation, sustaining research and development for new crop varieties, promoting mechanized on-farm and postharvest strategies, and harnessing the potential of high-elevation and upland rice ecosystems.

In spite of these efforts, however, rice self-sufficiency is still untenable, argues Briones. He explains that the FSSP targets are based on highly ambitious and unrealistic projections palay yield , from 3.78 t/ha to 4.53 t/ha, and production from 17.0 to 22.7 million t, over the period 2011 to 2016, corresponding to annual growth rates of 3.8 and 6.3 percent, respectively. These growth projections are clearly unattainable considering that historically, yield and production grew by a meager 1.5 and 3.2 percent, respectively, from 1994 to 2010.

A closer look at the underlying economic forces and economic behaviors of producers, consumers, and markets further reveals that increasing rice production alone would not eliminate importation. The study reveals that the only way to achieve rice self-sufficiency is to increase import barriers. However, Briones explains that protectionist policies would also make rice in the local market substantially more expensive and therefore will jeopardize the country`s pursuit for food security.

He notes that the goal of self-sufficiency should not be equated to zero imports. Rather, the goal should be based on a broader set of criteria such as nutritional norms for rice consumption and rice affordability, among others. He urged the government to rethink its policy.

For more information on this study, you may download the full text of the study from http://serp-p.pids.gov.ph/serp-p/download.php?d=5100. For queries on this topic, you may contact the Institute`s Public Affairs office at 892-4059 (c/o Gift Baroy or Gizelle Manuel) or email inquiries@pids.gov.ph.