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PH logistics performance drops The continues to be lackluster in terms of logistics sector performance. This according to the latest report of the World Bank, “Connecting to Compete 2016: Trade Logistics in the Global Economy.”

ased on the Logistics Performance Index (LPI) data, the country's competitiveness on trade logistics dropped 14 Bspots from 57th place in 2014 to 71st place in 2016 among 160 countries worldwide. The report showed that the country’s poor infrastructure attributed to its overall low score of 2.86 index. The World Bank’s LPI, which is conducted every 2 years, measures the efficiency and performance of a country’s logistics infrastructure. It can help countries identify challenges and opportunities and improve their logistics performance based on 6 parameters: hh Efficiency of customs and border management clearance; hh Quality of trade and transport infrastructure; hh Ease of arranging competitively priced shipments; hh Competence and quality of logistics services; hh Ability to track and trace consignments and since 2007 (see Philippines-Logistics Performance). The World hh Frequency with which shipments reach consignees within Bank identified the Philippines as a ‘partial performer’ in terms scheduled or expected delivery times. of its logistics efficiency based on the results of 2016 LPI index. Over the past 4 years, the Philippine logistics performance Meanwhile, National Council for Competitiveness Philippines has been declining drastically (see Philippines Logistic co-Chairman Guillermo Luz said that the country’s decline in Performance). This year has been the lowest ranking since LPI ranking was due to the port congestion in 2014. 2007. The Philippines’ Logistics Performance Index (LPI) He added that there is “no surprise” in the downgrade of score dropped to 2.86 in 2016 from 3.0 score 2 years ago. the country’s logistics sector due to the effects of the Manila Across the components monitored by the index, only the country’s truck ban in which the flow of goods and services were timeliness of shipments improved by 20 spots from 90th to 70th affected, also taking a toll on businesses’ cost effectiveness. place this year. Most of the components of Philippines logistics The Philippines was placed as the 4th lowest in terms of sector have declined when compared to its 2014 past performance. logistics performance when compared to its ASEAN neighbors, The Philippines ranked the lowest in terms of infrastructure in trailing behind Singapore, Malaysia, Thailand, Indonesia, Vietnam 2016 at 82nd place, with a score of 2.55 among all the components. and Brunei. The country ranked 7th followed by Cambodia, The country’s customs and border management clearance, Myanmar and Laos (see ASEAN Countries-LPI Ranking). tracking and tracing of consignments and its performance on international shipments in 2016 were the worst recorded ranking

Philippine ANALYST BUSINESS July 2016 45 BUSINESS

Part of the country’s decline in LPI ranking was due to the Manila port congestion in 2014

PHILIPPINES—LOGISTICS PERFORMANCE

2016 2014 2012 2010 2007

LPI Ranking 71 57 52 44 65

Customs 78 47 67 54 53

Infrastructure 82 75 62 64 87

International shipments 60 35 56 20 63

Logistics quality and competence 77 61 39 47 70

Tracking and tracking 73 64 39 44 69

Timeliness 70 90 69 42 70

Source: World Bank’s Logistic Performance Index

ASEAN COUNTRIES—LPI RANKING

2016 2014 2012 2010 2007

Singapore 5 5 1 2 1

Malaysia 32 25 29 29 27

Thailand 45 35 38 35 31

Indonesia 63 53 53 75 43

Vietnam 64 48 59 53 53

Brunei 70 * * * *

Philippines 71 57 52 44 65

Cambodia 73 83 101 129 81

Myanmar 113 145 129 133 147

Laos 152 131 109 118 117

*Brunei was not included in the previous LPI editions Source: World Bank’s Logistic Performance Index

Far better support is needed from the government.

Philippine ANALYST BUSINESS July 2016 46 BUSINESS

International Logistics Tracking Country Year LPI Rank LPI Score Customs Infrastructure Timeliness shipments performance & tracing

Region: East Asia 2016 2.98 3.02 3.08 3.07 3.12 3.54 3.14 & Pacific

Philippines 2016 71 2.86 2.61 2.55 3.01 2.70 2.86 3.35

Source: World Bank’s Logistics Performance Index 2014, 2016

top 10 countries in logistics performance index-2016

Country LPI Rank 2016 LPI Score 2016 LPI Rank 2014 LPI Score 2014

Germany 1 4.23 1 4.12

Luxembourg 2 4.22 8 3.95

Sweden 3 4.20 6 3.96

Netherlands 4 4.19 2 4.05

Singapore 5 4.14 5 4.00

Belgium 6 4.11 3 4.04

Austria 7 4.10 22 3.65

United Kingdom 8 4.07 4 4.01

Hong Kong 9 4.07 15 3.83

United States 10 3.99 9 3.92

Source: World Bank’s Logistics Performance Index 2014, 2016

The Philippines logistics sector is expecting to earn a higher spot in the next LPI rankings in 2018.

Philippine ANALYST BUSINESS July 2016 47 BUSINESS

The country’s logistics infrastructure was also ranked as The challenge of unlocking the PH aviation the 4th lowest among the ASEAN countries. Highlighting industry’s potential the need for far better support from the government in order to compete with other ASEAN countries. These past years marked progress for the aviation industry as In terms of geographical region, East Asia and Pacific posted the Philippines concluded multiple air services agreements 2.98 LPI index, a 0.12 score points difference from the Philippines’ with several countries. But, the industry’s international LPI index. The Philippines does reasonably well on the timeliness expansion is hampered by poor air transport infrastructure. of shipments when compared with the region. However, the country’s customs, infrastructure, international shipments, Over the past 3 years, the country has signed several bilateral logistics competence and tracking & tracing continues to lag behind air agreements, most of which were for expansion (see Recent the Asia region (see Philippines’ LPI ranking VS. Asia Region). developments in PH aviation). The past administration pursued Out of the 160 countries covered by this year’s report, air talks as part of its "pocket" open skies policy, wherein Germany remained the top performer in terms of logistics airports other than the country’s main gateway, the Ninoy performance with a LPI score of 4.23, while Syria has the Aquino International Airport (NAIA), were opened to more lowest score of 1.6 index. Germany was 70 spots afar from foreign traffic. And just last February, the ASEAN Open Skies the Philippines LPI ranking. Other countries that top the LPI Policy, a landmark aviation agreement that is expected to lead ranking were Luxembourg (4.22), Sweden (4.20), Netherlands to better connectivity in Southeast Asia, was signed. ASEAN (4.19), and Singapore (4.14). Among Asian countries, Singapore Open Skies allows designated carriers of ASEAN countries and Hong Kong posted a high logistics performance (see to operate unlimited flights between capitals in the region. Top 10 Countries in Logistics Performance Index-2016). These air agreements improve market access which The World Bank also classified the 160 economies into 5 groups: should expand the aviation industry’s growth. The sector’s top 10 LPI economies, bottom 10 LPI economies, lower-middle- development, in turn, is expected to contribute to the country’s income economies, upper-middle-income economies, and the low- economic development since aviation is a key enabler of income economies. The Philippines is considered by the World travel and tourism. However, the country’s current poor air Bank as among the ‘top-performing lower-income economies.’ transport infrastructure poses the biggest hindrance to the According to the World Bank, countries characterized industry’s growth. The main challenge to Philippine aviation by low logistics performance, such as the Philippines, face is the ability of infrastructure to keep up with the growth in high costs, not merely because of transportation costs but demand: the volume of passengers into and across the country also because of unreliable supply chains, a major handicap and the number of aircraft movements are increasing, but in integrating and competing in global value chains. infrastructure development is moving at a too slow pace. The Philippine logistics sector is expecting to earn International and domestic air traffic in the country have higher spot in the next LPI rankings in 2018 as the new increased quite significantly over the past 5 years (see PH’s administration of President Rodrigo Duterte pushes to air passenger traffic), but infrastructure has suffered, with improve the country’s logistics sector and infrastructure, only minimal improvements over the years making it still one which are included in his 10-point economic agenda. of the poorest in Southeast Asia (see PH’s world ranking in terms of air transport infrastructure). The country’s 4 main terminals which are all based in , as well as provincial airports, are currently mired in passenger and air traffic congestion (see NAIA’s congestion problems). Although NAIA Terminal 1 has recently undergone renovation and major improvements, it is still not fit to cater to growing demand. Currently, the new administration is weighing its options on the location of a new airport outside Metro Manila and is reviewing the projects aimed at improving the country’s provincial airports. These are necessary but what would really matter is if they are actually built and developed. The government needs to act urgently on building a better air transport infrastructure if it is to boost the country’s tourism sector. In addition to this, as airline companies are also in the process of increasing operations, improved aviation infrastructure is ever more needed. Looking ahead, the aviation industry will continue to expand in the coming years amid increasing global competition, regionalization and globalization. But in order to support its development and for the country to cash in on the ASEAN open skies, a strong air transport infrastructure must be present. Moreover, a strong aviation hub, which requires new and improved airports along with better air traffic control management, is needed to further develop the local tourism sector, which is the country’s 4th largest source of foreign exchange earnings. Philippine ANALYST BUSINESS July 2016 48 BUSINESS

RECENT DEVELOPMENTS IN PH AVIATION Philippines signed the ASEAN Open Skies agreement, which allows designated carriers of ASEAN countries to operate unlimited flights February 2016 between capitals. December 2015 Manila and Rome signed an air services agreement that allows direct flights between the 2 cities. August 2015 Philippines and the United Arab Emirates signed a deal that increased their mutual entitlement to 35 flights from 28 per week. May 2015 Philippines and Australia signed an agreement that increased seat entitlements to 9,300 seats from 6,300 seats per week. Philippines and Oman signed a new air agreement that increased frequencies between Manila and Muscat to 7 flights from 3 per week. The agreement also covers 5th freedom traffic rights, allowing carriers from the hilippinesP to carry passengers to 1 point in Europe, 1 point in April 2015 India, and 1 point in the Gulf States, and carriers from Oman to carry passengers to 1 point in Malaysia, 1 point in Indonesia, and 1 point in Thailand. Philippines and Singapore signed an agreement that increased seat entitlements to 18,888 seats from 17,627 seats per week for each February 2015 country. Philippines and Ethiopia signed its 1st air agreement that allows 7 flights per week from Manila to Ethiopia and unlimited flights from October 2014 Ethiopia to other Philippine airports. August 2014 Philippines and South Africa signed an air pact that allows for 7 weekly flights for each country. June 2014 Philippines and Macau signed an air agreement that allows weekly seat entitlements to 7,020 from 4,500 for each country. May 2014 Philippines and Canada signed an air deal that allows flight entitlements for each side to 14 flights from 7 a week. May 2014 Philippines and Myanmar signed an agreement that allows direct flights between the 2 countries. Philippines and New Zealand signed a new air agreement that increased the frequency of flights to 21 from 3 flights per week, improved March 2014 the 5th freedom exchange to enable Philippine carriers to operate 5th freedom flights to Australia and New Zealand carriers to operate 5th freedom to China, and allowed third country code sharing for the carriers of the Philippines and New Zealand. Philippines and Singapore amended their air services agreement increasing the number of seats on the Manila-Singapore route to about February 2014 17,600 from the current 13,800 seats per week for each country. The agreement also expanded the countries' 5th traffic rights by adding China on top of Osaka and Seoul for Singapore, and India on top of Kuala Lumpur and Bangkok for the Philippines. Philippines and France signed an air agreement that allows for 7 flights per week between the 2 countries, and for a third country code 2014 sharing that will allow Air France and KLM to fly to Manila via Amsterdam. 2013 Philippines concluded air talks with Japan, Macau, Brazil, Australia, Israel, and Italy. Compiled by The Wallace Business Forum

PH’S WORLD RANKING IN TERMS OF AIR TRANSPORT INFRASTRUCTURE

2011-2012 2012-2013 2013-2014 2014-2015 2015-2016 COUNTRY (selected ASEAN countries) (out of 142 (out of 144 (out of 148 (out of 144 (out of 140 countries) countries) countries) countries) countries) Singapore 1 1 1 1 1 Malaysia 20 24 20 19 21 Thailand 32 33 34 37 38 Indonesia 80 89 68 64 66 Vietnam 95 94 98 87 75 Philippines 115 (81%) 112 (78%) 113 (76%) 108 (75%) 98 (70%) Source: World Economic Forum’s (WEF) Global Competitiveness Reports *Goal is to be part of top 1/3 (33%)

The country’s recently signed air agreements improve market access, but current poor air transport infrastructure poses as the biggest hindrance to the development of the industry.

Philippine ANALYST BUSINESS July 2016 49 BUSINESS

A strong aviation hub, which requires new and improved airports along with better air traffic control management, is needed to further develop the local tourism sector, which is the country’s 4th largest source of foreign exchange earnings.

NAIA’S CONGESTION PROBLEMS  Passenger volume in 2014 for all the 4 terminals totaled 34.1 million, which is already near NAIA’s maximum handling capacity of 35 million passengers per annum. · NAIA Terminal 1, which already reached its capacity in 1991, handled around 7.1 million passengers when it was designed to only accept 4.5 million passengers yearly. · Terminal 2 was only supposed to accommodate 7.5 million passengers annually, but it handled 7.8 million passengers. · Terminal 3 accommodated around 15.6 million passengers when its handling capacity should be just 13 million annually. · Terminal 4 handled 3.5 million passengers, which is beyond the recommended 3 million.  NAIA is also facing air traffic problems due to gridlocked runways that cause several flight delays. Earlier, the Manila International Airport Authority (MIAA), an average of 150 to 200 flights are delayed every day, wasting some P7 billion worth of fuel annually. NAIA’s runways have been maximized to accommodate 40 air traffic movements (the landing and take-off activities) per hour.

Compiled by The Wallace Business Forum

PH'S AIR PASSENGER TRAFFIC, 2011-1H2016 (In Million)

25 22.08 20.57 20.33 20.35 19.86 20 18.77 17.92 17.32 16.74 15.67 15

11.28 10

5.84 5

0 2011 2012 2013 2014 2015 1H2016 International Domestic

Source: Civil Aeronautics Board’s (CAB) Statistics

Philippine ANALYST BUSINESS July 2016 50 BUSINESS

Competition law: A game-changer At the recently concluded Business World Economic Forum (Charting Progress to 2020), speakers Mr. Balisacan; The passage of Republic Act (RA) 10667, known as the Suraj Moraje, managing partner of McKinsey & Co.; and Philippine Competition Act (PCA), marks an important Teresita Herbosa, chairperson of the Securities and Exchange milestone in the arena of policy-making, given that it has Commission (SEC) explained the importance of the PCA. been pending in the Congress for over 20 years. The PCA According to them, sustainable and inclusive growth would seeks to ensure efficient and fair market competition. It has be achieved if the PCA is properly implemented. In addition, a tough job to achieve. Mr. Balisacan also enumerated certain factors (see below) that resulted from the country’s restrictive economic policies and anti-competitive business practices. It was these factors The primary goal of the PCA is to make the business that led to the creation of the law, Mr. Balisacan noted. environment more conducive to investments by providing consumers with more choices at lower prices; creating efficient hh Poor performance of the economy over the last 4 decades; regulations; and exploring various opportunities to accelerate hh Unequal distribution of opportunities, resulting in a condition growth and employment. And with the recent release of the of widespread poverty co-existing with affluence and implementing rules and regulations (IRR), the question of prosperity; “How is it a game changer?” comes to mind. Arsenio Balisacan, hh Extreme difficulty for small and medium enterprises (SMEs) chairman of the Philippine Competition Commission (PCC), to thrive and prosper, hindering the growth of employment pointed out that the PCA is a “game-changing legislation” opportunities; and created to combat “very restrictive economic policies and hh Failure to be a significant player in the prosperous Asian region. anti-competitive business practices that have been costly to the economy and public welfare.” The PCA also remains crucial in terms of sustaining the country’s robust economic growth.

What are the powers given to PCC to address competition-inefficiency issues? Source: Philippine Statistics Authority (PSA). hh Antitrust: enforce legal prohibitions against anti-competitive business agreements, including cartels and the abuse of dominant market position; hh Merger control: regulate those likely to substantially prevent, restrict or lessen competition; hh Market studies and investigations: examine markets that are not working well, and impose remedies to further enhance competition (only if deemed necessary); hh Competition advocacy: enhance practices and challenge barriers to competition

The Philippine Competition Act is a game-changing legislation that aims to create a business environment that is more conducive to investments.

Philippine ANALYST BUSINESS July 2016 51 BUSINESS

Senator Bam Aquino, a proponent of the law, said that the terms and conditions thereof.” At present, legislative licenses are legislation is, indeed, a game-changer for the economy since only given to media companies, power transmission companies, it “penalizes bad market behavior and abuse of dominant commercial airlines and telecommunication service providers. positions.” Despite growing concerns from some business groups, But while the proposed legislation is intended to improve the Mr. Balisacan assured that the law would not be a burden to them. mining industry, policies should be more focused on creating a Meanwhile, Davao del Norte Representative Anthony del Rosario regulatory framework that promotes and protects investments said that the PCA would “allow (the country) to take advantage of (e.g. rationalizing the current multiple mining regimes into a the opportunities brought about by the Asean market integration.” single one). According to Ronaldo Recidoro, spokesman of This holds true, especially for the SMEs, as they would be the the Chamber of Mines of the Philippines, there is no need for ones who would most benefit from it. SMEs now have the additional environmental safeguards because the existing mining chance to thrive and prosper, given that there would be a level- law is adequate. He added that increasing the regulator’s budget playing field for all businesses. Aside from this, Mr. Balisacan and creating a department solely for mining should be done said innovations and investment in research and development instead of adding more steps (see Peter Wallace’s “A Sensible (R&D), together with greater product variety, lower prices, Annulment” to gain more idea on the creation of a Department of and better quality goods and services are among the important Mining: http://opinion.inquirer.net/95531/a-sensible-annulment). “channels” wherein poverty reduction and enhancement of The country, despite having bountiful and diverse mineral public welfare can be achieved. (For more information: see Fair, resources, has not been able to live up to its potential. The local efficient market competition in the making? May 2016 Analyst.) mining industry has struggled since the 1970s, missing much of the mining boom and is now dealing with much lower commodity prices. Much of this lost opportunity was due to the lack of support and recognition of mining’s benefits to the economy, MINING, OIL, & GAS specifically in terms of trade, employment, investments and government revenue. During the previous Aquino administration, Legislative franchise for mining companies the industry was fraught with challenges which caused stagnant growth for the industry. The near-zero growth was due mainly to eyed the lack of new mining investment because of the government’s refusal to issue mining permits and environmental compliance The lower house will push as a priority bill the requirement for certificates (ECCs). President Aquino, in 2012, issued a ruling mining firms to acquire a legislative franchise. The proposal to stop the issuance of new mining permits, which affected came as the new government declared its intention to fight thousands of mining applications in the country. In 2015, the against irresponsible mining. This bill is meant to ensure last full year of the Aquino administration, mining investments that miners are complying with safe and environmentally- dropped by 22.5%, from $1.19 billion in 2014 to $924.94 million friendly mining standards, however, it’s not clear why it’s in 2015 (see Select PH Mining Statistics). As much as $900 necessary as the Philippines already has a strong mining law. million, close to 98%, of the total amount of investments were dedicated only to the expansion of existing mining operations. The grant of a franchise by Congress is a privilege that can Industry observers were then gunning for a recovery and be taken back, withdrawn or revoked if the franchise holder genuine, investment-inducing mining policy reforms once fail to rigorously adhere to the terms and conditions of their the Aquino administration ended. Unfortunately, the industry concessions. In this case, licenses of mining firms to operate will may again be up for another bumpy ride. Currently, there is be revoked if found not adhering to proper mining regulations. a nationwide crackdown on all miners in the country. The According to new House Speaker Pantaleon Alvarez, who crackdown is led by newly appointed Environment Secretary proposed the idea, the suggested policy would place mining Gina Lopez, who is a renowned anti-mining advocate. After companies under a legislative oversight body “instead of a only some 2 months in office, Secretary Lopez has already probably bribable bureau in an obscure DENR (Department of suspended 8 mining firms that are accused of being part of illegal Environment and Natural Resources) office if they violate the and irresponsible mining activities. With President Duterte also

The proposed bill will mandate mining firms to acquire a legislative franchise to ensure that miners are complying with safe and environmentally-friendly mining standards.

Philippine ANALYST BUSINESS July 2016 52 BUSINESS

Policies should be more focused on creating a regulatory framework that promotes and protects investments.

SELECT PH MINING STATISTICS (2010-2015)

2010 2011 2012 2013 2014 2015 Gross Value Added in Mining (in 88.2 96.9 79.5 77.7 90.7 80.9 billion pesos)

Contribution to GDP (%) 1.0 1.0 0.7 0.7 0.7 0.6

Investments (in million dollars) 1,053.1 1,197.3 921.7 1,499.7 1,193.1 924.94 Source: Mines and Geosciences Bureau’s (MGB) Mining Industry Statistics

Mining investments dropped 22.5% in 2015.

sending a warning that he would cancel mining operations that I.T. UPDATE are damaging the environment, recent developments signify another tough regulatory road ahead for miners in the country. IT-BPM to generate 1 Mn more jobs by 2022 Meanwhile, some mining companies have stated that they are open to the proposal of acquiring congressional approval. The Philippines information and business process Francis Ballesteros Jr., the division head of Philex Mining Corp.’s management (IT-BPM) sector is expected to double its Public and Regulatory Affairs, welcomed the Speaker’s proposal, revenues and generate an additional 1 million jobs by 2022 while Dante Bravo, president of Global Ferronickel Holdings under a new roadmap. The country’s IT-BPM industry is Inc., said the proposed system of legislative franchise was currently at the tail end of its previous blueprint known as “creative,” and added that he will be waiting for more details. the 2012-2016 Philippine IT-BPM roadmap. Aside from the legislative franchise requirement, Rep. Alvarez said he will revive a measure requiring mining companies to not export Information Technology and Business Process Association ores and instead process them locally to give more jobs to the poor. of the Philippines (IBPAP) executive committee chairman Benedict Hernandez said the IT-BPM sector is expected to hire 1 million more employees over the next 6 years. In addition, Mr. Hernandez said that with 3 to 4 indirect jobs created per direct job in the industry, a total of 4 to 5 million additional new jobs (on top of the 1 million direct jobs) in the country are expected to be also generated during the period. The IBPAP has partnered with consulting firm Frost & Sullivan in developing the country’s IT-BPM roadmap 2022. During the dialogue with internal and external stakeholders, IBPAP asked other sectors of the IT-BPM industry to share their thoughts on how to sustain the growth of the industry that would be a key component of the Roadmap 2022. Philippine ANALYST BUSINESS July 2016 53 BUSINESS

PH IT-BPO Revenues (in billion U.S. Dollars) 2009 8.25 2010 10.05 2011 12.07 2012 13.2 2013 15.5 2014 18.4 2015 22 2016 *25 *Forecasts only 2016 - $25 billion (goal - 2016 BPO roadmap)

PH IT-BPO Employment 2009 444,811 2010 536,128 2011 679,464 2012 776,794 2013 900,000 2014 1,030,000 2015 1,200,000 2016 *1,300,000

*Forecasts only 2016 - 1,300,000 (goal - 2016 BPO roadmap

Source: IBPAP; Bangko Sentral ng Pilipinas

The new IT-BPM Roadmap 2022 is a comprehensive sector is growing at more than twice the growth of the global 6-year plan to chart the growth course of the industry as it faces industry over the last 5 years. With a 6% compounded annual fast-evolving technology, a shifting political and regulatory growth, the global opportunity for the Philippines IT-BPM is environment, changing preferences of clients, as well as the expected to grow from $166 billion to $250 billion by 2022. implications of digital transformation, automation and artificial “As we hit our targets for the original Roadmap 2016, intelligence. It will also seek to identify how the country can we need to unveil a new industry game plan that will continue to push more investments and job creation outside Metro enable our country’s IT-BPM sector to achieve continued Manila. The new roadmap is currently 60% finished and is expected remarkable growth and contributions to the economy. The to be completed and presented to the public on October 27 this year. global market and technology trends present significant IBPAP said the industry is expected to meet all of its opportunities for the Philippines,” Mr. Hernandez said. targets under the 2012-2016 Philippine IT-BPM roadmap, The new roadmap will also tackle the development, primarily 1.3 million in direct employment and $25 billion growth trajectories, and issues affecting each of the industry’s in revenues this year. In 2015, IT-BPO revenues almost 6 verticals as represented by IBPAP’s partner associations, reached $22 billion (see PH BPO Revenues). The IT-BPM namely - Animation Council of the Philippines Inc., Contact Philippine ANALYST BUSINESS July 2016 54 BUSINESS

IT-BPM sector is also expecting that the newly-created Department of Information and Communications Technology (DICT) will play a major role in achieving the aims of Roadmap 2022.

Center Association of the Philippines, Game Developers Association of the Philippines, In-House Centers Council, Healthcare Information Management Association of the Philippines and Philippine Software Industry Association. IT-BPM sector is also expecting that the newly- created Department of Information and Communications Technology (DICT) will play a major role in achieving the aims of Roadmap 2022. The sector is looking forward to partnering with the new administration as it turns over the new Roadmap 2022 to President Rodrigo Duterte.

Philippine ANALYST BUSINESS July 2016 55 BUSINESS

LIST OF BOI-REGISTERED PROJECTS - JUNE 2016 Project Cost Equity Industry Activity (PHP MILLION) Local/Foreign

AGRICULTURE, FISHERY, & FORESTRY Producer of tetra prisma packed coconut water and its variants - Medina, Misamis Axelum Resources Corporation 550.00 100% Filipino Oriental General Santos Feed Manufacturing 95% South Korean Producer of animal feeds (pineapple pulp and corn silage) in Polomolok, South Cotabato 13.77 (GSFMC) Corporation 5% Filipino

Pilmico Animal Nutrition Corporation Producer of animal feeds in Sto. Domingo II, Capas, Tarlac 491.09 100% Filipino

AUTOMOTIVE TRADE Mitsubishi Motors Philippines Participating car maker under CARS Program for its Mirage/Mirage 4 model 4,390.00 100% Japanese Corporation 60% Filipino Toyota Motors Phils. Corp. Participating car maker under CARS program for its Vios model 3,250.00 40% Japanese

CONSTRUCTION

60% Filipino GMR Megawide Cebu Airport PPP for Mactan Cebu International Airport Project (Phase 2 - Operation and Maintenance 16,750.00 38% Singaporean Corporation of Terminal 2) in Lapu-lapu City, Cebu 2% Indian

ELECTRICITY, WATER, AND GAS Renewable energy developer of 80.4 Wind Power Project in Pililia, Rizal, Mabitac, and 86% Filipino Alernergy Sembrano Wind Corporation 8,526.00 Pakil, Laguna 14% Dutch 67% Filipino Universal Robina Corporation Producer of chilled carcass/prok primal cuts (Buliran Rd., Antipolo, Rizal) 153.00 33% Various 75% Filipino Redondo Peninsula Energy, Inc. Operator of 2 X 300 MW Coal-Fired Power Plant on a Non-Pioneer Status 62,863.56 30% British Virgin Islands HOTEL, RESTAURANT, AND LEISURE SERVICES

FTC Group of Companies Corporation Operator of tourist accommodation facility (Aeon Towers) in Bajada, Davao City 540.97 100% Filipino

OFFSHORING AND OUTSOURCING

42% Filipino Innovatus Philippines, Inc. Business process outsourcing (BPO) services - Sta. Maria, Balibago, Angeles City 5.80 58% Australian

REAL ESTATE AND PROPERTY DEVELOPMENT Developer of economic and low-cost housing project (Monterra Verde - Batch B) in Borland Development Corporation 187.74 100% Filipino Tanza, Cavite Developer of economic and low-cost housing project (Ridgepoint Subdivision) in Prinza, Borland Development Corporation 157.16 100% Filipino Teresa, Rizal Developer of economic and low-cost housing project (Sunrise Point Subdivision - Batch A) Borland Development Corporation 205.91 100% Filipino in Inosluban, Lipa City

Developer of economic and low-cost housing project (Fiesta Communities - Porac II-A Fiesta Communities, Incorporated 858.40 100% Filipino and II-B) in Porac, Pampanga Developer of economic and low-cost housing project (FCI - Asinan Subic) in Subic, Fiesta Communities, Incorporated 296.30 100% Filipino Zambales Developer of economic and low-cost housing project (Grand Monaco - Casa Royal) in Grand Monaco Estate Developers, Inc. 75.33 100% Filipino Binangonan, Rizal Developer of economic and low-cost housing project (Grand Monaco - Casa Verde) in Grand Monaco Estate Developers, Inc. 84.16 100% Filipino Calumpit, Bulacan Developer of economic and low-cost housing project (Grand Monaco - Alegria) in Grand Monaco Estate Developers, Inc. 57.14 100% Filipino Antipolo City Developer of economic and low-cost housing project (Grand Monaco - Bellevue II) in San Grand Monaco Estate Developers, Inc. 77.32 100% Filipino Isidro, Cainta, Rizal

Developer of economic and low-cost housing project (Grand Monaco - Casa Mia) San Grand Monaco Estate Developers, Inc. 107.90 100% Filipino Jose, Antipolo City Developer of economic and low-cost housing project (Sterling Residences One) in Naic, SP Land, Inc. 640.05 100% Filipino Cavite Developer of economic and low-cost housing project (Torre de Florencia) - District II, Merrytown Properties Corporation 990.49 100% Filipino Caloocan City TOTAL 101,272.10

Philippine ANALYST BUSINESS July 2016 56 BUSINESS

PEZA APPROVED PROJECTS -1st Quarter 2016 Equity INDUSTRY ACTIVITY ZONE Local/Foreign APPAREL AND TEXTILE MANUFACTURES

CRETEX INTERNATIONAL, INC. Garment manufacturing and sewing services 99% - Korean Golden Mile Business Park - SEZ

YONYOU INC. Engage in design and production of general apparel 99.99% - Japanese Cavite Economic Zone

AUTOMOTIVE TRADE

CHURITSU CEBU, INC. Manufacture of automobile piping parts 99.99% - Japanese Mactan Economic Zone

Manufacture/assembly of after-market accessories for the CURT MANUFACTURING PHILIPPINES, INC. automotive industry consisting of wire harness, printed circuit 99.99% - American Cavite Economic Zone boards and brake control assembly

MITSUBA PHILIPPINES CORP. Manufacture of power relays 99.99% - Japanese First Cavite Industrial Estate - SEZ Engage in the rebuilding of used core automotive/automobile TOKYO REPARTS CORPORATION 99.95% - Japanese Pampanga Economic Zone parts/body parts and components TOYO SEAT PHILIPPINES CORPORATION Manufacture of cooler box 99.97% - Japanese Greenfield Automotive Park - SEZ

ELECTRICITY, WATER, AND GAS Engage in the distribution of power within the Gensan GENSAN ECOZONE ENERGY CORPORATION 100% - Filipino Gensan Economic Zone Economic Zone ELECTRONICS

ALLIANCE MANSOLS INC. Surface mount technology (Line 5) 100% - Filipino Laguna Technopark - SEZ

ARUZE PHILIPPINES MANUFACTURING, Manufacture and production of gaming machines such as slot 99.99% - Chinese Light Industry & Science Park III - SEZ INC. machines, roulette machines and other gaming equipment

BEYOND INFINITY CONNECTION Manufacture of wire harness 99.99% - Japanese Pampanga Economic Zone PHILIPPINES, INC. DECA TECHNOLOGIES INC. (PHIL. Autoline system for advanced semiconductor packaging 100% - American Laguna Technopark - SEZ BRANCH) technology Design, manufacture, assembly and test of Semiconductor DELTA DESIGN PHILIPPINES LLC 100% - Singaporean Carmelray Industrial Park II - SEZ Test Sockets/Contactors and their sub-components FTGROUP (PHILIPPINES), INC. Manufacture/assembly of LED products and related parts 99.99% - Japanese Laguna Technopark - SEZ

Manufacture and assembly of RC toys, robot toys and their GA&P TEC INC. accessories such as DC geared motor, servo motor and 99.99% - Korean Cavite Economic Zone connectors 60% - Filipino Manufacture of Insulated Gate Bipolar Transistor (IGBT) 30% - BIV INTEGRATED MICRO-ELECTRONICS, INC. for high power industrial application and include Complex Laguna Technopark - SEZ 6% - Belgian Assembly Build and System Integration 4% - Various LEADER ELECTRONICS (PHILIPPINE Assembly and export of DC cord wires, LED lighting fixtures, 100% - Taiwanese Cavite Economic Zone BRANCH) INCORPORATED and Linear Power Supply Manufacture of living fan engine assembly (using BLDC and MINEBEA PHILIPPINES, INC. GSP motors) and include Ice Maker Actuator Assembly (using 99.99% - Japanese First Philippine Industrial Park - SEZ GSP motor)

RENKYO INDUSTRIAL (PHILIPPINES) INC. Manufacture of electronic products and parts 99.99% - Taiwanese Laguna Technopark - SEZ SAMSUNG ELECTRO-MECHANICS Manufacture of super low ESR/ESL, miniaturized and Calamba Premiere International Park 100% - Korean PHILIPPINES CORPORATION advanced tantalum capacitor (SMAT Cap) - SEZ SMART ELECTRONICS MANUFACTURING PCB Assembly 100% - Korean Carmelray Industrial Park II - SEZ SERVICE PHILIPPINES, INC. SENGOKU PHILIPPINES INC. Manufacture/assembly of home appliances 99.99% - Japanese Light Industry & Science Park II - SEZ Manufacture/assembly of liquid crystal display and LCD TOKAI DENSHI PHILIPPINES INC. 99.97% - Chinese Cavite Economic Zone module products WYNTRON INC. Manufacture of Voltage/Current Transducer 99.99% - Malaysian Cavite Economic Zone

FOOD AND BEVERAGES MANUFACTURES

BIOTECHJP CORP. Manufacture of food and therapeutic food 99.98% - Japanese First Philippine Industrial Park - SEZ

HOTEL, RESTAUTANT, AND LEISURE SERVICES Hotel and restaurant operations, particularly the establishment of Heimisla Resort Villa consisting of four (4) 60% - Filipino HEIMISLA CORP. Pamalican Island Tourism Ecozone hotel rooms - villas or casitas, living room, pavilion, service 40% - Austrian building, and swimming pool Establishment of resort operations, travel/tours/leisure and PANGULASIAN ISLAND RESORT CORP. 100% - Filipino Green Tourism Ecozone - Pangulasian recreation-related activities (Pangulasian Island Resort) IT AND IT-ENABLED SERVICES CIRCUS INTERNATIONAL PHILIPPINES, Graphic design, web design, system engineering/programming 100% - Japanese The Enterprise Center INC. activities

Philippine ANALYST BUSINESS July 2016 57 BUSINESS

Engage in providing digital or online marketing services, in COMPLETE BUSINESS ONLINE INC. 99.6% - Australian BA-Lepanto Building all its forms Primary development and production support through graphic design, web design, and system programming activities HALLOHALLO INC. 100% - Japanese The Enterprise Center generating websites and application, and advertising and mass media activities services

IT service provider in the Field of Business Process PDC ASIA-PACIFIC INC. 99.99% - Australian I.T. Bldg. Outsourcing (Engineering Design)

RENO HAPPIA BGC INC. Computer Aided Design (CAD) Services 99.25% - Japanese Twenty-four Seven McKinley

TSUKIDEN GLOBAL SOLUTIONS INC. AUTOCAD Engineering System Design 99.99% - Japanese

Integrated circuit design, verification and layout (Physical XINYX SEMICONDUCTOR DESIGN SERVICES Mask design) covering full-custom design and layout of 100% - Filipino Insular Life Corporate Center INC. integrated circuits

MEDICAL AND HEALTH SERVICES SHINAGAWA LASIK & AESTHETICS CENTER Operation of a Lasik and Aesthetic Center (Ambulatory 99.999% - Japanese Hanston Square CORPORATION Surgical Clinic) METAL INDUSTRIES

FAMOUS SECRET PRECISION MACHINING, 60% - Filipino Manufacture/assembly of aerospace parts and components Daiichi Industrial Park - SEZ INC. 40% - Chinese

IRON WORKS NORTH BEARD PHIL. INC. Manufacture of logistics steel pallets and metal parts 99.99% - Japanese Lima Technology Center - SEZ Fabrication and molding products such as automotive car KOREAN MOLD SYSTEM INC. 99.99% - Korean Greenfield Automotive Park - SEZ press die KUY CORP. Fabrication/assembly of metals and other related products 99.99% - Japanese Cavite Economic Zone

Manufacture of tools, jigs and other products made of 50% - Japanese NAKAYAMA KOGYO PHILS. INC. Laguna Technopark - SEZ fluorine resin 50% - Filipino

O.M. MANUFACTURING PHILIPPINES, INC. Silver Recovery Project (Silver Shots) 100% - Japanese Cavite Economic Zone SANNO PHILIPPINES Plating of pins, connector parts and lead frames used for MANUFACTURING CORP. 99.99% - Japanese Gateway Business Park - SEZ semiconductors

80% - Canadian SUPERMETAL MANILA, INC. Structural steel Ddetailing services Worldwide Corporate Center 20% - Filipino

97% - Korean TAEYOUNG TECHWIN INC. Fabrication of metal parts and components Cavite Economic Zone 3% - Filipino

TIGERCHAIN INC. Manufacture and assembly of industrial roller 99.99% - Japanese Laguna Technopark - SEZ

TURU SANTECHNO CORPORATION Includes assembly of water enhancer for washing 99.95% - Japanese First Cavite Industrial Estate - SEZ

90% - American YE-SUNG TECHNOLOGY, INC. Die-casting of metal products 8% - Korean Cavite Economic Zone 2% - Filipino

Production of New Model Parts of Tail Pipe Finishers for the YUTAKA MANUFACTURING (PHILIPPINES), 17th model of CRV finishers (TLA Finisher) and 17th Acura MDX 100% - Japanese Laguna Technopark - SEZ INC. model finisher

MISCELLANEOUS MANUFACTURES

ARKRAY INDUSTRY, INC. Manufacture of Lancing Device 100% - Japanese First Philippine Industrial Park - SEZ Engage in the Production of Hot Foil and Thermal Transfer OPEN DATE ASIA, INC. 99.99% - British Laguna Technopark - SEZ printers

P. IMES CORP. (PHILIPPINE INTERNATIONAL MANUFACTURING AND Open Stent Graft (OSG) wire assembly 99.99% - Japanese Cavite Economic Zone ENGINEERING SERVICES CORP.)

SUNPOWER PHILIPPINES MANUFACTURING Production of solar wafer cells (Gen2) 100% - Caymanian First Philippine Industrial Park - SEZ LTD. (BRANCH OFFICE)

SUNPOWER PHILIPPINES MANUFACTURING Production of horizon high efficiency solar modules 100% - Caymanian Laguna Technopark - SEZ LTD. (BRANCH OFFICE)

SANSYU PRECISION LIPA, INC. High precision painting of automotive plastic parts 99.99% - Japanese Lima Technology Center - SEZ

Manufacture of men's and ladies' footwear such as shoes SUN-PLEATS CEBU CORPORATION sandals, slippers, socks and other similar/related product 100% - Japanese Mactan Economic Zone lines

OFFHOSRING AND OUTSOURCING

IT-enabled Business Process Outsourcing (BPO) services and 3M SERVICE CENTER APAC, INC. total support solutions from the Philippines, and for locally- 99.99% - Singaporean E-Square I.T. Park based 3M companies as well as 3M’s in the Asia Pacific Region

Philippine ANALYST BUSINESS July 2016 58 BUSINESS

60% - Filipino 411 YOUR BUSINESS ON THE PHONE INC. Call center operations Cebu I.T. Tower 40% - Bulgarian

AGR OPERATIONS MANILA, INC. Business process outsourcing (BPO) and IT Services 99.99% - American Aeon Centre Eugenio Lopez, Jr. Communication ABS-CBN STUDIOS, INC. Engage in IT-enabled film and television content production 100% - Filipino Center Disaster Recovery (DR) site in an area/facility to be sub- AIG SHARED SERVICES - BUSINESS leased from its affiliate, AIG Share Services Corporation 99.99% - American PBCom Tower PROCESSING, INC. (Philippines) ANDERSON BUSINESS HOLDINGS LIMITED Business process outsourcing using e-commerce (contact 100% - British - PHILIPPINES center) BAYER BUSINESS SERVICES PHILIPPINES, Establishment of a Shared Service Center 99.99% - Filipino McKinley Hill Cyberpark INC. AVID TECHNOLOGY (S.E. ASIA) PTE. LTD - Perform customer service, administrative, and other business 100% - Singaporean Uptown Bonifacio PHILIPPINE BRANCH support functions Administrative services, marketing and sales support CAPITAL ONE PHILIPPINES SUPPORT conducted through available communications technologies; 99.99% - American Northgate Cyberzone SERVICES CORP. and other IT-enabled outsourced services Back office support in the administrative, accounting billing, training/demo classes, as well as data file recording and CHINA ONLINE INNOVATIONS INC. maintenance for performance evaluation and retrieval on 99.99% - Caymanian Wynsum Corporate Plaza class module matching to optimize educational/learning processes BPO-exporting knowledge-based and computer-enabled CLOUD PLUS SERVICES, INC. 99.99% - Australian Polar Center EDSA services Customer support, customer care services, consulting services, research and development, software development CONCUR (PHILIPPINES) INC. 99.99% - Dutch Alphaland Southgate Towers and application, business process outsourcing, content development, and other activities necessary

Customer service support via VoIP and/or other appropriate 96% - British DATACENTRIC CORPORATION One World Place technology to its clientele 4% - Swiss

Software development, IT support services, enterprise DELTEK SYSTEMS (PHILIPPINES), LTD. software and information solutions, training and industry- 100% - American The Enterprise Center specific consulting services operations

Business process outsourcing (BPO), research and analytics EXLSERVICE PHILIPPINES, INC. 99.99% - British SM iCITY 2 and advisory services GOPRO PHILIPPINES LTD. – PHILIPPINE Shared service center providing finance, accounting, tax BRANCH and Global Information and Technology Services as well as 100% - American E-Square I.T. Park (Branch office in the Philippines of Gopro technical support services Philippines Ltd.) HARTE-HANKS PHILIPPINES, INC. Call center operations 99.99% - American SM iCITY 2

92% - Hong Kong KMC MAG SOLUTIONS, INC. Business process outsourcing (BPO) services 6% - American The Rockwell Business Center 2% - Filipino

92% - Hong Kong KMC MAG SOLUTIONS, INC. Business process outsourcing (BPO) services 6% - American Uptown Bonifacio 2% - Filipino IT-enabled customer support services such as email and voice, LIZARDBEAR TASKING INC. 99.8% - American Anonas LRT City Center photo-enhancing and other support services ICT-enabled services (Call/Contact Center Operations LUFTHANSA SERVICES PHILIPPINES, INC. and Back Office Support such as Finance and Accounting, 99.99% - German Aeon Centre Administrative Services) Business to Business Application, Enterprise Information OPEN TEXT (PHILIPPINES), INC. 99.88% - American RCBC Plaza Management operation ORCHID CYBERTECH SERVICES, Call center operations 100% - Australian Cyberscape Beta INCORPORATED Business Process Outsourcing and Technology-enabled service RMS COLLECT PHILS. INC. such as contact center, customer management telemarketing 99.99% - American SMDM IT Center front office and back office management and support services

SLK GLOBAL PHILIPPINES, INC. Call center operations 99.99% - Indian Northgate Cyberzone

SPi CRM INC. Call center operations 99.99% - Filipino LP Information Technology Park

SPi CRM INC. Call center operations 99.99% - Filipino Cyberscape Alpha

SPi HEALTHCARE, INC. Business Process Outsourcing (BPO) services 99.99% - American LP Information Technology Park

TSoftware development, web development, programming and 70% - Swedish STOK MNL INC. Eastwood City Cyberpark related services 30% - Filipino

SUTHERLAND GLOBAL SERVICES Process Consulting, Back Office Processing, Technology 100% - Caymanian Shaw Center Mall PHILIPPINES, INC. Support, and Customer Relations Management SUTHERLAND GLOBAL SERVICES Process Consulting, Back Office Processing, Technology Tarlac Provincial Information Technology 100% - Caymanian PHILIPPINES, INC. Support, and Customer Relations Management Park II SYNKOM IC TECHNOLOGY INC. Cloud design service for software 99.99% - Japanese Twenty-four Seven McKinley

Philippine ANALYST BUSINESS July 2016 59 BUSINESS

Development, creation and programming of proprietary 97% - American TAS TRADESOFT CORPORATION Negros First Cybercentre software and applications 3% - Filipino

Engage in functional and technical IT expert services for the TECHNOLOGEAST 1227 INC. development, deployment and maintenance of business, 100% - Filipino One Corporate Centre mobility and analytics enterprise software Provide data tabulation services, data storage, data hosting, TECSURGE, INC. data/software application service, computer system 99.99% - Singaporean Cebu I.T. Park integration activities, etc. Business process outsourcing (BPO) services and call center THE MINACS GROUP INC. 99.99% - Indian Eastwood City Cyberpark operations Development and maintenance of existing and new system THE RED FLAG GROUP (PHILIPPINES) INC. 99.97% - Hong Kong BGC Corporate Center software Administrative Support/Services (P2P); Basic/Site Support, TI (PHILIPPINES), INC.. 99.99% - Dutch Baguio City Economic Zone Enterprise/Global Support and Software Development (ACE) Support and administrative services for an Australian-based 96% - British TORRES BPO CORP. Eastwood City Cyberpark company through e-commerce 4% - Filipino

An additional 3,987.44 sq.m. area for its Information UNITEDHEALTH GROUP GLOBAL Technology Services, Call Center Services and Back Office 99.99% - Dutch Filinvest Cebu Cyberzone SERVICES, INC. Operations Back-office processing services including providing document VISAYA KNOWLEDGE PROCESS and transaction processing services, contact center solutions 100% - Filipino Trafalgar Plaza OUTSOURCING CORPORATION and telemarketing services

VXI GLOBAL HOLDINGS B.V. (PHILIPPINES) Call center operations 100% - Dutch SM iCITY 2

Provision of administrative, back office, call center, WELLS FARGO ENTERPRISE GLOBAL information technology, support training and other allied 100% - American Uptown Bonifacio SERVICES, LLC-PHILIPPINES service related to the foregoing services

Business of providing information technology products and 92% - Japanese WOLK HUREN PHILIPPINES INC. Cebu I.T. Park services such as software development and maintenance 8% - Filipino

OTHER BUSINESS SERVIES

ARKRAY INDUSTRY, INC. Research and Development Services 100% - Japanese First Philippine Industrial Park - SEZ

Engage in Site Hosting services to the project of KMC Mag APEX 5678 ROCKWELL, INC. 99.99% - Hong Kong The Rockwell Business Center Solutions, Inc. (KMSI)

Manufacture of fabric and webbing not only for automotive TAKATA (PHILIPPINES) CORPORATION safety applications but also for marine, transportation, 99.99% - Dutch Laguna Technopark - SEZ construction and other industries

REAL ESTATE AND PROPERTY DEVELOPMENT

ATLANTICA INDUSTRIAL RESOURCES Registration of its additional warehouse facility (Atlantica 5) 100% - Filipino Cavite Economic Zone CORP. ATLANTICA INDUSTRIAL RESOURCES Registration of its additional warehouse facility (Atlantica 7) 100% - Filipino Baguio City Economic Zone CORP. Develop, operate and maintain a proposed 4-storey building AYALALAND OFFICES, INC. 100% - Filipino UP Science and Technology Park (North) (with basement and roof deck) BLOOMRICH LAND, CORP. Construction of three (3) units warehouse facilities 100% - Filipino Suntrust Ecotown Tanza CAL-COMP TECHNOLOGY (PHILIPPINES), Operation and maintenance of a warehouse/factory building 99.99% - Thai Carmelray Industrial Park II - SEZ INC.. DAE SHIN HAN TECH CORPORATION. Operate and manage its existing warehouse 99.99% - Korean Cavite Economic Zone Operation and management of a newly-constructed 2-storey GEMPHIL TECHNOLOGIES, INC.. 100% - Filipino Cebu Light Industrial Park - SEZ steel building Authority to lease out a 3,814 sq.m. space of its Building to KINPO ELECTRONICS (PHILIPPINES), INC. 99.99% - Taiwanese Lima Technology Center - SEZ Cal-Comp Technology (Phils.) Inc.

94% - Korean KUDOSA REALTY PHILS., CORP. Construction of a factory/warehouse building First Industrial Township - SEZ 6% - Filipino

Authority to lease-out 11,278 sq.m. of its vacant building NXP SEMICONDUCTORS CABUYAO, INC. 99.99% - Dutch Light Industry & Science Park I - SEZ space to RF Power Component Philippines, Inc. (RPCPI) ORIENT GOLDCREST REALTY, INC. Registration of its additional 26-unit warehouse facility 100% - Filipino Light Industry & Science Park IV - SEZ

PANORAMA PROPERTY VENTURES, INC. Registration of its additional four (4) warehouse facilities 100% - Filipino Lima Technology Center - SEZ

85% - Filipino PHIL BRIGHT CORPORATION Construct, operate and maintain 3-unit factory/warehouse Hermosa Ecozone Industrial Park 15% - Taiwanese

Authority to lease-out a total of 1,358 sq.m. consisting of 629 sq.m. factory building space and 729 sq.m. concrete driveway 60% - Filipino PHILAKE METAL CORPORATION Cavite Economic Zone area and common parking area to Zhan Jung Metal Finishing 40% - Taiwanese Corporation

Philippine ANALYST BUSINESS July 2016 60 BUSINESS

FOREIGN DIRECT INVESTMENT BUSINESS CLIMATE INDEX Balance of Payments Concept*; JANUARY - APRIL 2016

LEVEL (US$ million)

YEAR-AGO YEAR-ON-YEAR CURRENT LEVEL (% CHANGE) TOTAL FDI 3,495.7 123.7 183.6 Equity Capital 1,320.5 279.4 372.6 Reinvested Earnings 255.1 266.0 (4.1) Debt instruments 1,920.1 687.3 179.4

* The BSP adopted the Balance of Payment, 6th edition (BPM6) compilation framework effective 22 March 2013 with the release of the full-year 2012 and revised 2011 BOP statistics. In BPM6, net FDI flows refer to non-residents’ equity capital (i.e., placements less withdrawals) + reinvestment of earnings + debt instruments, net (i.e.,net intercompany borrowings).

YEAR- INDUSTRIAL PERFORMANCE DATA YEAR-TO- ON-YEAR (2000=100) MAY 2016 (INDEX) DATE GROWTH (2000=100) Volume of Production Index (VoPI) 121.3 -1.2 3.2 a. Food 140.0 20.4 23.0 MOTOR VEHICLE SALES b. Beverage 133.5 3.2 4.2 JUNE 2016 YEAR-AGO GROWTH RATE c. Tobacco 6.6 4.8 -14.0 CURRENT LEVEL (%) d. Textile 35.8 -19.2 -12.9 MOTOR VEHICLE SALES 32,993 24,185 36.4 e. Footwear and Wearing Apparel 25.0 -3.8 -14.0 PASSENGER CAR SALES 1,951 9,840 21.5 f. Wood and Wood Products 63.1 9.9 -1.1 g. Furniture & Fixtures 728.1 -5.3 -8.8 COMMERCIAL VEHICLE SALES 21,042 14,345 46.7 h. Basic Metals 184.5 45.2 17.5 UNIVERSAL AND COMMERCIAL BANK'S - MARCH 2016 i. Iron and Steel 134.5 7.7 -0.4 LOANS OUTSTANDING TO THE REAL ESTATE SECTOR (P Bn) j. Non-ferrous Metals 304.5 128.3 52.1 % to Total % to Total k. Fabricated Metal Products 219.1 -24.5 -14.5 Mar-16 Mar-15 RE loan RE loan l. Machinery Excluding Electrical 59.4 43.5 23.5 Residential 266.1 24.6 247.02 28.2 m. Electrical Machinery 94.8 -4.3 4.0 Commercial 817.78 75.4 629.63 71.8 n. Transport Equipment 145.6 20.3 5.5 o. Other Mfg Industries 121.4 4.2 -1.3 p. Paper & Paper Products 77.4 -0.1 1.4 q. Publishing & Printing 157.3 5.0 16.9 r. Leather Products 0.7 -83.3 -83.9 s. Rubber Products 261.9 1.5 -3.5 t. Chemical Products 125.5 -48.8 -22.5 u. Petroleum Products 36.9 -31.4 -26.0 v. Non-Metallic Mineral Products 141.5 -5.3 -1.3 w. Glass & Glass Products 101.3 -27.2 -14.0 x. Cement 186.5 -1.3 -4.4 y. Misc. Non-Metalic Mineral Products 49.1 -1.6 0.5 VALUE OF PRODUCTION INDEX (VAPI) 163.9 -4.8 -0.5 (2000=100) AVERAGE CAPACITY UTILIZATION 83.3 -16.6 83.4

Philippine ANALYST BUSINESS July 2016 61 BUSINESS BUSINESS CLIMATE INDEX STRIKES IN JUNE 2016 LABOR STRIKES (JUNE 2016) One work stoppage were recorded in June. Meanwhile, there were a total of 118 .notices of strike/lockouts handled during the period MAN-DAYS LOST STRIKES DECLARED WORKERS INVOLVED (000)

2016 2015 2016 2015 2016 2015 JAN ------FEB ------MAR ------APR ------MAY 2 3 175 450 7,225 1,362 JUN 1 - 217 - 1,736 - JUL ------AUG - 1 - 200 - 1,200 SEP ------OCT - 1 - 80 - 800 NOV - - - - - 1,520 DEC ------TOTAL 3 5 392 730 8,961 4,882

VISITOR ARRIVALS IN MAY 2016 Total visitor arrivals registered in May is 445,449, up by 7.61% from 413,937 in the .same month in 2015. Of this, 3.93% or 17,515 visitors were Filipinos residing abroad Korea remained the top source of market followed by the U.S. and the China. Visitors coming from Korea amounted to 94,736 (21.27% share of the total visitors in May). The U.S. market tallied 73,644 visitors (16.53%) while the Chinese market recorded 46,825 .)visitors (10.51%

VISITOR ARRIVALS: JANUARY-MAY2016 SURVEY ON MONTHLY OCCUPANCY RATE & LENGTH OF STAY COUNTRY 2016 2015 % CHANGE RANK Jan to Dec Jan to Dec Growth Rate KOREA 576,332 546,031 5.55 1 2014 2013 2014/2013 USA 377,595 350,776 7.65 2 De Luxe Hotels CHINA 285,348 157,830 80.79 3 Occupancy Rates 71.11 70.82 0.41 JAPAN 223,042 204,704 8.96 4 Length of Stay 2.74 2.87 -4.67 AUSTRALIA 108,382 102,323 5.92 5 First Class Hotels TAIWAN 89,792 69,362 29.45 6 Occupancy Rates 58.83 60.14 -2.18 CANADA 82,340 73,898 11.42 7 Length of Stay 2.14 2.20 -2.95 UNITED KINGDOM 76,275 66,410 14.85 8 Standard Hotels SINGAPORE 75,756 77,395 -2.12 9 Occupancy Rates 63.96 65.34 -2.11 MALAYSIA 60,911 65,115 -6.46 10 Length of Stay 2.52 2.46 2.27 HONGKONG 51,229 54,129 -5.36 11 Economy Hotels GERMANY 41,540 34,620 19.99 12 Occupancy Rates 59.73 52.15 14.53 OVERSEAS FILIPINO 90,052 91,362 -1.43 Length of Stay 1.65 1.87 -11.53 OTHERS 380,706 335,184 13.58 TOTAL 2,521,316 2,231,154 13.01 Overall Average 67.21 67.20 0.01

Philippine ANALYST BUSINESS July 2016