5 European firms consider investments in manufacturing

Five European firms are expected to set up  manufacturing facilities in the Philippines mainly for the production of industrial and construction materials following the government’s aggressive trade and investment promotion activities abroad.

The interest of these companies, four of which are from Germany and one based in Norway, was buoyed largely by the country’s continued strong economic expansion and its skilled, English-speaking labor workforce.

Trade Undersecretary Ponciano C. Manalo told reporters that the intent of these companies, whom he declined to disclose, was made known to them during a business mission in Europe last month.

Of the four German companies engaged in the manufacture of tooling, home construction and industrial goods, three did not have any exposure in the country while one firm has a limited distribution network, Manalo said. These companies are expected to set up large-scale facilities and, for at least one of the German companies, the planned Philippine site will be its first manufacturing plant in the Asean.

The Norwegian firm that was looking to set up a production plant here was also planning to sell to the domestic market, according to Manalo.

Apart from manufacturing and automotive, the Philippines also pushed the IT-BPM sector to European companies, along with agriculture and fisheries, creative industries and shipbuilding, among others.

The DTI has been making an aggressive pitch for manufacturing as the country targets the resurgence of this sector, which is targeted to account for 30 percent of the Philippine economy by 2020.

Reviving the manufacturing sector has been deemed crucial not only to sustain a robust economy, but to also ensure a more inclusive growth for the country.

Last year, the Joint Foreign Chambers and local business groups came out with a policy brief titled “Manufacturing: Creating Million of Better Jobs,” which disclosed targets, core strategies and critical recommendations that will enable the country to support both the high-value and the labor-intensive manufacturing industries.

The targets set in the policy brief were to double the manufacturing sector’s current labor force to 7.5 million from 3.5 million in 2012, and raise increase the sector’s contribution to GDP to almost 30 percent by 2022 from last year’s 21 percent.

For this year, the national government has allotted some P2.3 billion to implement a new program dubbed the “Manufacturing Resurgence Program,” meant to further boost the much needed investments in the sector. Part of this funding would be used to revive the Industry Development Council, the official body in terms of policy making.