The Philippine economy surges into 2015

Previously considered a developing nation, the Philippines has demonstrated its strength as a major manufacturing hub in the Asia-Pacific (APAC) region. Following years of strong economic growth, companies in this small island nation are now facing some of the most positive business conditions ever seen.

In fact, some reports show that the Philippines is now a stronger manufacturing hub than the previous powerhouse of the APAC region, Thailand. 

The Philippines pulling ahead

In regards to gross domestic product (GDP), the Thai economy has floundered since 2006, allowing the Philippines to move ahead while enjoying steady growth, according to a report published in the Manila Standard. While Thailand still holds the primary position, with a GDP of US$387 billion, the Philippines is well on the way to catching and potentially overtaking this global industry hub. Currently, the Filipino GDP sits at approximately $250 billion.

Manufacturing is an area of particular strength for the Philippines, with a 2014 study by Deloitte naming the nation as one of APAC's growth leaders.

"The strong growth in global manufacturing to 2033 will drive world growth, and this presents the Philippines with great potential to integrate into the global supply chain of high-value manufacturing," Deloitte Global Clients and Industries Managing Director Gary Coleman explained.

"If the government makes smart investments in infrastructure – including roads and harbours – that would help to boost the construction and transportation sectors and lead to higher productivity growth in the coming years as well."

Keeping manufacturing afloat in the Philippines

With such strong growth and activity forecast in the Philippines, it is important for investments and plans to support the potential of the relevant manufacturing industries. The country's Department of Trade and Industry, along with the Board of Investments, has formulated a plan to encourage the best possible results in the future of manufacturing.

This roadmap, if applied successfully, should lead to manufacturing controlling 15 per cent of the total workforce and 30 per cent of the country's industrial economy by 2025.

Already, investments in manufacturing are increasing, with international and local brands both taking an interest in Filipino labour and resources. Mitsubishi Philippines plans to increase output by 6 per cent this year, for instance, while Panasonic Corporation announced plans to incorporate the Philippines in their strategies to hit a 10 trillion yen sales target by 2018.

According to Deloitte, there are still considerations that may impact future manufacturing growth in the Philippines, but with the right support from the government, significant growth is likely.

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