Gov’t prepares industrial master plan (Malaya Business Insight)

As the country’s growth is driven more and more by services, there is some effort to rekindle the strength of the manufacturing sector which has languished the past two decades..

The government would come out with an industrial master plan as for the entire country in order to identify the gaps that had long plagued the country’s industries.

Trade Secretary Gregory Domingo said in an interview that the efforts that started with just a dozen   strategic roadmaps in the beginning of the year have swelled to over 50 in various stages of completion as more industries have come forward to volunteer and craft their own individual master plans.

Trade Undersecretary Adrian Cristobal Jr., point person for the Department of Trade and Industry (DTI) in this effort the master plan is targeted to be released in the first quarter of 2013 in time for the review of the Philippine Development, the Philippine Export Development Plan and the Investment Priorities Plan for consistency.

Cristobal said studies would show that the share of manufacturing to the country’s GDP has not been growing in part due to the inability of the country to attract investments .

“It has been stagnant and in some years,   it has even gone down.

Studies would show the correlation of foreign direct investments  to the growth of manufacturing,” said Cristobal.

He said the end-goal in the comprehensive master plan is to be able to formulate new, and implement existing policies that are consistent over the short, medium to long term.

Common concerns have come up during the initial phase of the consolidation: infrastructure, energy, human capital and logistics.

According to Cristobal, a country has to have decent  basic industries like iron and steel, petrochemicals and copper and copper industries.

Based on the initial list of submissions, industries like copper and chemicals are confident they can compete and do not need incentives.

Nine manufacturing sectors have completed their roadmaps: rubber and rubber products; copper and copper products, auto parts, biodiesel.

Engineered bamboo, chenmicals, paper and cement. Ten other sectors also gave their reports: organic agriculture, sugar, ruminant industry, energy, construction, water supply, transport, highway network development, air cargo and mass housing.

According to a study by the Philippine Institute for Development

Studies, the nine sectors alone account for 27 percent value added and 15 percent of employment as of 2009.

If electronics, food manufacturing and processing and garments and textiles are included, these would account for 71 percent of value added  and  65.4 percent of manufacturing employment.

“The idea is to gear the right policies that individual industries need. We would be able to incentivize in the right places,” said Domingo.

Acknowledging that policies are not a one-size fits-all for industries because each its own  peculiarities, the DTI  spearheaded the crafting of roadmap and  gathered  the private sector and sought the assistance government think-tank PIDS.

Domingo said the DTI plans to appoint an eminent persons group to give flesh to the industrial master plan.

The roadmaps started off with the electronics and business process outsourcing/information technology industries which had their own master plans long before.

The roadmaps now range from agribusiness, (coconut, hogs, poultry, coffee, rubber, flat glass, plastic, printing ink, garments and textile, fine jewelry, copper products , metal like  tool and die to petrochemicals.

Existing roadmaps of industries like iron and steel, agriculture and shipbuilding were also updated.

The DTI has so far identified pillars for industry development that include existing growth industries (electronics, ICT/BPO/call centers, shipbuilding, steel fabrication, mining, and plantation farming); SMEs (agribusiness, tourism, processed food, handicraft and  manufacturing businesses - industries that could help boost job generation in the countryside); and industries with large scale potential such as car/tire manufacturing, bamboo, palm oil, rubber, corn, and prawn farming, among others.

The PIDS study said manufactuiring in the has been experiencing slow growth rate; sluggish from 1980s to 1990s but with modest gains in 2000s.

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