Lena Wilson
Lena Wilson, head of Scotland’s main economic development body, wasn’t too bothered by the horrendous traffic that greeted her when she visited the Philippines for the first time in November.
The chief executive of Scottish Enterprise (SE) merely noted that the heavy traffic was an indisputable sign of a dynamic and growing economy.
Purchasing power
She added that she was “blown away” by the huge number of young people here, which was a positive indicator for an emerging market like the Philippines, and the growing purchasing power of Filipino consumers made obvious by the flurry of activities in shopping malls.
“The impression I’m getting is one of a vibrant, dynamic growing economy and you can see opportunities in that. But you can also see the challenges in energy, water, supply security, transportation systems, and everything it will take to be a smart city. So I think there are some real opportunities there,” Wilson said in an interview with the Inquirer.
“But if you look at Europe, I don’t think there is enough awareness of the Philippines as an economy and what some of those opportunities might be. So part of me being here is to build awareness, and for me to influence Scottish companies and Scottish investments to actually look at this market,” she added.
According to Wilson, the Philippines came into the picture when Andrew Tan-led Emperador Inc. acquired Scottish distiller Whyte & Mackay for $700 million earlier this year. This acquisition was “absolutely massive,” considering that there were no previous investments to talk of from the Philippines, while Scotland’s exports to the Philippines were marginal.
“That was very exciting because that was the third biggest investment from the Philippines and sixth largest from Asia into the United Kingdom. This is very significant. If you asked me a year ago if there were any major investments from the Philippines to Scotland in one of our largest brands, I would be very surprised. But now, looking at the way those conglomerates from the Philippines operate has widened our interests,” Wilson said.
“I would’ve thought of it as a trade story originally, but I think it’s very interesting to see opportunities in investments. Scotland is a small nation, so we need to focus on the things we’re really good at. We see potential collaboration (with local companies) on oil and gas, renewable energy, Scottish technology and engineering, among others,” she explained.
Such collaboration on energy, services, technology, and even in the education, and food and drinks sectors, is expected to help the Philippines further grow as an economy and overcome the challenges that come with this growth.
And this is why, Wilson explained, Scottish Enterprise was in the country: To scout for, understand further, and investigate prospective business opportunities that could jack up Scotland’s share in the exports of the United Kingdom to the Philippines to about 9 to 10 percent, and boost investments by local conglomerates to her country to $1 billion within a decade.
Focus
“Scotland doesn’t want to be all things to everybody so there’s a need to focus on things where we really have a global competitive edge and where we think there’s value to be generated for the market we’re going to and for Scotland. We are starting with petroleum and renewable energy, which would probably most productive for both of our economies,” she added.
In a recent speech before the British Chamber of Commerce of the Philippines, Wilson noted that Scotland’s 40 years of experience of operating in the North Sea made Scottish companies world leaders in oil and gas extraction, especially in deepwater and in harsh environments. Such skills were seen to have significant demand in this part of the world.
Scotland, she further claimed, has pioneering world leading technologies for the renewable energy sector (onshore and offshore wind as well as wave and tidal sources); smart grid technology; and water and waste management—all of which could have a significant potential in the Philippines. Scotland’s business services sector also has an international reputation as the country is home to some 400 business process outsourcing firms that employ over 90,000. Its BPO industry was deemed to be one of the best educated and skilled workforces in Europe, Wilson said.
“The BPO industry in the Philippines has seen tremendous growth over the last few years and we see real opportunities for collaboration between our sectors to position Scotland as a preferred nearshore and onshore location for companies looking to establish a footprint in Europe,” she added.
According to Wilson, the few Scottish companies that are already here were attracted to the Philippines given the steady growth in the economy, the stable political environment, some solid economic policies and the young dynamic nature of the workforce.
Growing interest
“The Philippine economy was one of the fastest growing in Asia with 7.2 percent growth last year, with an uninterrupted growth for the past 14 years. Although the pace of growth have slowed down slightly this year, it was still considered an impressive statistic given the situation in the United Kingdom, Europe and the United States,” Wilson noted.
“Trade between the Philippines and the UK is also growing. Exports from the UK to Philippines grew 13 percent last year and were worth $600 million while there are now over 200 UK companies operating in the Philippines. Now we don’t have figures for the Scottish proportion of those figures but we do know interest in the Philippines is growing among our Scottish companies,” she added.
These include energy companies like Agrekko, which is already operating in the country to provide temporary power solutions in the Visayas and Mindanao. Sgurr Energy has also been supporting wind farm and solar developments across the Philippines.
“I know if we’re able to share these stories with other Scottish companies, then I think we will start to see a lot more interest in the coming years,” Wilson added.