DTI-EMB, PHILEXPORT and EDC gear up for the National Export Congress 2018

The Department of Trade and Industry (DTI) through the Export Marketing Bureau, the Philippine Exporters Confederation, Inc. (PHILEXPORT) and the Export Development Council leads the conduct of the 2018 National Export Congress (NEC). NEC is the highlight of the week-long celebration of the National Exporter’s Week (NEW). This year’s theme, “SPICE Up to Scale Up! (Stimulate. Permeate. Innovate. Connect. Expand!)”, is consistent with the thrust for the Philippine export industry to be at the cutting edge of innovation and connectivity as a competitiveness strategy.

Over 700 delegates including exporters, business support organizations, policy makers, and academe will convene at the Philippine International Convention Center (PICC), Pasay City on 07 December 2018 for the annual NEC. The event will have discussions on various topics such as global outlook and prospects for Philippine exports, expanding market, ease of doing business, industry-led innovation and connectivity. Export Enablers Exhibit and Logistics Fair will also transpire during the event which will showcase the services of government clearance agencies, financing institutions, Halal certifying bodies and logistic providers.

The NEC is the main activity of the National Exporters’ Week (NEW). The first week of December is declared as the Exporters’ Week per Presidential Proclamation 931, Series of 1996 and House Resolution 33, in order to obtain total commitment of the government and the private sector to continuously work together to sustain and maintain export promotion and development.

Also part of the week-long NEW celebration is the conduct of Usapang Exports, an information sessions under the DTI-EMB’s Philippine Export Competitiveness Program (PECP), on 03-05 December 2018 and the conduct of Logistics Summit organized by the DTI-Competitiveness Bureau (CB) on 06 December 2018. (MDGTD)

Personal properties now accepted as loan collateral 

President Duterte signed last month, Republic Act No.11057 or the Personal Property Security Act (PPSA)  to boost access to credit and financing for the country’s micro, small and medium enterprises (MSMEs), including exporters as well as farmers and fisherfolks. This means that banks and other financial institutions will now accept account receivables, inventory, warehouse receipts, crops, livestock, machinery and equipment, vehicles and even deposit accounts.

In the past, banks and other financial institutions prefer traditional collateral such as real estate or land for loan applications. As these assets are hard to come by for MSMEs, bank loans were often only accessible to and obtained by larger corporations. But with the new measure, land titles would now cease to be the sole requirement for securing bank loans.

By expanding the said list, the government is promoting an increase in economic activity of the MSMEs which redounds to better businesses, more revenues and more jobs for the Filipinos.

Further, the law also provides for the establishment of a unified, centralized online notice-based collateral registry that is lodged in the Land Registration Authority (LRA) to provide protection and more confidence to banks and financial institutions in lending to MSMEs and the agriculture sector. Such collateral registry will serve as a centralized digital record for personal properties being used as collateral, thus, allowing banks to make sure that their applicants’ collateral will not be used for more than one loan application.

In addition, the passage of the law is expected to improve the country’s position in the Getting Credit indicator of the Ease of Doing Business Survey of the World Bank.

Finally, with a sustained effort from the government and private sector partners, the country will surely achieve a more competitive and sustainable economic growth through a reformed and secured transaction system in the country. (GTM)

Customs to curtail corruption via enhanced goods declaration system

 

 

 

 

 

In a bid to suppress corruption, the Bureau of Customs (BOC) is now in its second phase of pilot testing the implementation of the 1-Assessment System in selected ports in the country.

1-Assessment which is formerly known as Enhanced Goods Declaration Verification System (EGDVS) is a web-based application which will institutionalize the “Zero Contact Policy” in the cargo clearance process. The system will randomly assign Customs examiners and appraisers to goods declaration filed, thus, removing the “suki system”.

As such, examiners, appraisers and brokers can now only communicate through the 1-Assessment portal. Pursuant to Customs Modernization and Tariff Act and other related laws and regulations, Customs Memorandum Order (CMO) 17-2018, which implements the system, provides sanction and penalties to violating parties. .

For transparency, the system also enables importers and brokers to obtain real-time status of their goods declaration lodged with the BOC.

The system will only cover “import consumption entries cleared under the formal entry process in all ports of entry.

Exempted from the 1-Assessment system, even if cleared under the formal entry process, are the (1) Super Green Lane shipments, (2) articles withdrawn from the Customs Bonded Warehouse for local consumption, (3) wastages under the Bonded Warehouse Regime and jet operation losses, (4) goods entered as temporary imports for subsequent re-exportation and (5) deferred payment of government.

To use the system, importers and brokers shall lodge their goods declaration through the Value Added Service Providers, who shall in turn transmit the E2M lodged goods declaration to the 1-Assessment system.

The brokers must then attach the supporting documents to the system. However, original hard copies of supporting documents and notarized copy of the Single Administrative Document (SAD) and Supplemental Declaration on Valuation shall be submitted to the Entry Processing Unit or equivalent office in the port for documents verification.

Another feature of the system is the randomly re-assignment of goods declaration that remained unattended for two hours.

The 1-Assessment system which is the second version of the EGDVS was already implemented at the Port of Manila and Manila International Container Port in October 2017.  Covered in the second-pilot implementation are the ports of Batangas, Clark, Limay, Subic and Surigao and the sub-ports of Bislig, Nasipit, Mariviles, Siain, Puerto Princesa and Bauan. Expected full implementation of the system will either be in December 2018 or in early 2019. (ARB)

PH needs to catch up with ASEAN neighbors in Dual Training System


Philippine and  German delegates to the benchmarking mission on Dual Training System in Malaysia and Thailand

The Philippines needs to catch up with ASEAN neighbors in the implementation of its Dual Training System (DTS). This conclusion is a result of the recent benchmarking mission to Malaysia and Thailand on Dual Training System conducted last 22-27 October, 2018. The main objective of the mission is to benchmark and network with the Malaysia and Thailand Technical Vocational Education and Training (TVET) systems and approaches with the end view of adoption and potential best practice elements in Dual VET, certification and In-company training which are the essential elements of the Dual Training System (DTS).

The lessons learned include determination of how the Dual VET policy framework in both countries is operationalized on the ground; observation how the Malaysian and Thai Dual DTS models work; gainful and deeper insight into both countries’ experiences through direct interaction with the DTS practitioners; comparison of various approaches and identification of what is adaptable in the Philippines; and instituting networks with Malaysia and Thai Dual VET players.

The Malaysian government fully supported the DTS system in their country, in coordination with the German Chamber of Commerce and Industry-Malaysian Chapter (GCCI-Malaysia), by providing land, building and training facilities and equipment to train those students who opted to take vocational courses as well as their unemployed youths. In turn, GCCI-Malaysia assisted the government by partnering the Malaysian training institutions with multinational companies in terms of technical assistance and acquiring state of the art equipment/ technology or laboratories for use of students and faculties alike. Courses offered in the Malaysian DTS program include Mechatronics, Industrial Management and Logistics Operations Management, Electronics, Automation, Industry 4.0 Specialists course, International Master Craftsman, to name a few. However, unlike in the PH, Malaysia does not implement a ladderized form of education wherein subjects were not credited by the Malaysian higher education institutions when students who took up vocational courses finally opts to enroll in college.

The Thai government also fully supports the DTS system in their country in collaboration with the German Chamber of Commerce and Industry-Thailand (GCCI-Thailand). It can be noted that the DTS implementation in Thailand specifically of the Don Bosco Academy can be replicated in the PH to help  strengthen resurgence of the country’s manufacturing sector e.g., students produce products for exporters using equipment and facilities donated by multi-national companies or thru the assistance of the German Federal Republic. In addition, Thailand is implementing a ladderized form of education where subjects being taken in the tech-voc curriculum are being credited by the Thai higher education institutions.

Meanwhile, in order for the PH to catch up, it is recommended that a review and subsequent amendment of the current Dual Training System Law be considered.  This is so because in the DTS law, the Technical Education and Skills Development Authority (TESDA) is both the regulator and provider of all technical and vocational trainings in the country, notwithstanding the private training institutions in the country who are to be accredited first by the latter before they can operate.  The PH should also formulate strategies and interventions needed by the country’s apprenticeship program as it relates to our current “endo” regime.  Apprenticeship programs under the dual training system can last from two (2) to three (3) years.  Hence, with our current “endo’ arrangements, this would be impossible.

The said study mission was spearheaded by the AFOS Foundation – K to 12 Plus Project ( a TVET training institution based in Cebu) in collaboration with the German Chamber of Commerce and Industry Philippines (GCCI-PH). Twenty five (25) participants (three (3) Germans and twenty two (22) Filipinos) from private sector, academe and training institutions took part in the said activity. (GTM)

NWPC  focuses on people- centric technologies & innovation  for MSMEs

As the fourth industrial revolution or Industry 4.0 gain momentum, the National Wages and Productivity Commission (NWPC), an attached agency of the Department of Labor and Employment (DOLE),  focused its 2018  National Productivity Conference on  people-centric technologies & innovation for MSMEs.  DOLE Undersecretary Ciriaco Lagunsad, III pointed out that  the on-going concern on inflation can also be addressed by improving the productivity of producers which will influence prices.  As such, he emphasized the need to embrace new technologies, but put people in control of technology.
Assistant Secretary Rafaelita Aldaba of the Department of Trade and Industry (DTI) supports the NWPC as she said that human capital is crucial for innovation and entrepreneurship.  DTI’s approach to implement Industry 4.0  is through the Inclusive Industrial Innovation Strategy  that aims to link the manufacturing sector with agriculture and services. Such links can be realized when there are regional inclusive innovation centers where government, research agencies, academe and industry collaborate for improved competitiveness.
Asian Development Bank’s Director of Development Economics and Indicators Dr. Rana Hasan confirms that technology increases incomes, contrary to the fear of many that  jobs will be  lost with the use of artificial intelligence (AI). He said that AI cannot be stopped as it is already here. Education, training and social protection such as unemployment insurance are necessary to cope with these new technologies. (EZM)

PH infrastructure development programs unveiled for competitiveness

DPWH Undersecretary Catalina Cabral presented in the recently concluded Arangkada Philippine Forum 2018 the convergence programs with other government agencies like DOT, DTI- BOI and DA that will further fuel high growth of domestic investments as well as the surge in foreign direct investments of the country.

Undersecretary Cabral highlighted the masterplan of the Metro Manila Logistics Improvement Program that will enhance the road connectivity around Metro Manila. In addition to the 26 existing bridges crossing Pasig River, Marikina River, and Manggahan Floodway, 12 new bridges will be constructed to provide alternative linkages between major thoroughfares and increase the number of usable roadways that will decongest traffic in Epifanio delos Santos Avenue (EDSA) and other major roads in Metro Manila.

On seaports and shipping, high cost of international and domestic shipping translates to high cost of consumer goods. Hence, Ms. Doris Magsaysay-Ho, president and chief executive officer of Magsaysay Group of Companies, recommends the creation of manufacturing and industry clusters in each region to create trade volumes, lower shipping costs, and make the country competitive. These clusters, she noted, should be developed close to port and airport infrastructures and be designed to make handling products more efficient.

On air, Senator Grace Poe pointed out the P350B NAIA Consortium project that will rehabilitate, expand, operate, and maintain the Ninoy Aquino International Airport (NAIA) for 35 years. Also, she mentioned the unsolicited proposal of Bulacan Airport that is one of the two gateways being prioritized by the government to decongest NAIA’s three terminals, which have been operating over their capacity.

On telecommunications, Senator Sherwin Gatchalian is hoping to fix the dysfunctional dynamics of the infrastructure development by fostering liberalization and competition through reform legislation.

These measures include amendments to the 80-year-old Public Services Act to clarify the definition of public utilities as only those public services which are natural monopolies by nature. This is being sought by Senate Bill No. 1754. He also clarified that easing the country’s foreign investment restrictions is not meant to favor foreign firms over domestic players.

As chair of the Senate Committee on Economic Affairs, Senator Gatchalian pointed out that the Philippines continues to lag behind its ASEAN neighbors in terms of capturing foreign investments due to the country’s relatively restrictive and less competitive economic policies.  (MJA)

FDA prioritizes CPR for export products 


The Food and Drug Administration (FDA) recently announced that processing of  applications for Certificate of Product Registration (CPR) for export products are prioritized.  Exporters are advised to indicate in the list of products for CPR application that such are for export.
Ms. Helena Alcaraz, Chief of the Licensing and Registration Division of the  FDA Center for Food Regulation and Research, said that issuance of the CPR will be facilitated even better if the application is accompanied with a proof of prospective order (e.g., email showing interest of a foreign buyer).  FDA will also validate if the applicant is an exporter. (EZM)

Mandatory training for new exporters recommended

PEDP 2018-2022 Stakeholders Engagement in CALABARZON
“First time exporters need to undergo training and seminars before they can apply for Client Profile Registration System (CPRS),” says CALABARZON experienced exporters  This was aired during the Stakeholders Engagement to implement the Philippine Export Development Plan 2018-2022. Existing exporters advise aspiring exporters to first  learn, not only the market requirements, but also the Philippine government’s requirements and procedures before making their first shipment,  thus  sparing them of the problems that the former have encountered.

The CPRS is an application that  registers exporters to access the e2M system of the Bureau of Customs. Export transactions cannot be processed unless the exporter is registered in the CPRS.

Capacitating exporters through  trainings and seminars on domestic and international regulations, policies and trends  will also help exporters exploit existing and prospective bilateral, regional, and multilateral trading agreements.

Bill separates the regulatory and commercial functions of PPA

House Bill (HB) No. 8005 seeks to separate the regulatory and commercial functions of the Philippine Ports Authority (PPA) and create a new port agency called Philippine Ports Corporation (PHILPORTS) will focus on developing, managing, and operating public ports.

The bill also proposes to transfer the regulatory functions of the PPA to the Maritime Industry Authority (MARINA).

Representative Arthur Yap, author of HB 8005, aims to reform the country’s ports administration to avoid conflict of interest arising from regulatory agencies vested with both regulatory and development or commercial functions.

If enacted, PHILPORTS will collect port fees and dues approved by MARINA, which will fund port development, modernization, and expansion, among others.
PHILPORTS will become more of a service provider than a revenue generating entity. It is not envisioned as earning revenue from cargo handling and/or any service providers contracted by PHILPORTS.

As such, it shall continuously give utmost priority and importance to public service delivery and promotion of public interest. It also addresses the problems of port users (domestic shippers, exporters and importers) such as low service quality, inefficient port operations and ever-increasing port charges.

Under HB 8005, it will be governed by a 15-member Board, which includes representatives from both the government and the private sector.
The Export Development Council together with other stakeholders has been stressing the need for such policy reform to lower the cost of port services for shippers that will eventually benefit the consumers.

To download a copy of the bill, please click House Bill No. 8005.

Heightened Industry-Government-Academe partnership increases employment and improve international competitiveness

“Since the inception of the industry-government-academe linkage, there is now greater participation and partnerships between companies and universities in the implementation of this reform at ground level.”  This was reported by Mr. Sergio R. Ortiz-Luis, Jr., president of the Philippine Exporters Confederation (PHILEXPORT) and Vice-Chair of the Export Development Council (EDC), during the  recently concluded 8th National Education Forum.

The industry leader cited both the BPO (Business Process Outsourcing) and the Electronics industries as models for industry-government-academe partnership. They have been adopting and implementing the said reform in order for them to address their jobs-skills mismatch and make their respective industries become more globally competitive.

To date, The BPO employs 1.3 million people last year and is expected to grow up to 1.7 billion within the year, while the electronics industry employs 3.2. million direct and indirect workers.  In addition, both industries have established work immersion and internship programs as well as various industry-based programs that promote employment.

Ortiz-Luis, Jr, later explained that responding to the global realities and domestic demands would require a balance between what is being demanded by the labor market and what is being supplied by the education and training sector. He added that there is need to respond to the challenges posed by globalization, trade liberalization, information and technological advancement, international cooperation and agreements.

He continued that “globalization, includes among others, freer and borderless movement of capital goods, services, technology, information and human resource development between and among countries. Thus, the rapid change in information and communication technology directly impacts on the way work is being organized and executed, how products are being manufactured and shipped, and how systems and processes are implemented”.