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I first noticed it when looking at this report on the most credible source of info on global manufacturing. https://www2.deloitte.com/content/da...x_11_15_12.pdf
Philippines does not even make an appearance at all. Even Bangladesh (and likewise Pakistan) which I know is still ahead of Philippines as an exporter to major companies did not make it, so it seems like Philippines is WAY off the radar. Even smaller countries with a smaller role in global manufacturing still got a minor ranking, greece having 1.0 meaning anyone not listed gets a zero rating on here. With the huge impoverished population of the Philippines, and one of the highest populations overall in the world, they can't afford to go without manufacturing, which is a must to rise up like the rest. Philippines has the population AND cheap labour advantage both way ahead of almost all countries in the world. So why is it like completely off the RADAR for global manufacturing? Google searches also confirm this, as searches on new developments also yield things like India, Vietnam, Mexico, Bangladesh and Myanmar, even Africa and plus China and others, with no news on the ones that already dominate like Thailand, but nothing on Philippines at all.
What in the world is going so wrong with the Philippines that it can't even step foot in the world of exporter manufacturing like every single other well populated country? and why does noone even seem to want to consider it?
I heard that manufacturing is essential for a country to develop and show any noticable reduction on poverty and in the case of Philippines, reduction on the dominance of slums in the cities. If Philippines really can't become a major exporter of high value goods starting within 20 years, I will never see the day the slums shrink in size. I think a complete absence of industrialization from manufacturing will help hold wages down as the only booming services sector is just proliferating off the meager wages situation and promoting low wages, and no improvement of the economic situation. Manufacturing forces wages up continuously as the country keeps building up manufacturing. What the Philippines has does not do this at all.
The Bamboo network has chosen to not utilize the cheap labor available there. Why they havent? I guess maybe they have so much manufacturing already going on in Thailand, Vietnam, China, there may not be enough demand for higher wages in those places to cause manufacturing to move.
What in the world is going so wrong with the Philippines that it can't even step foot in the world of exporter manufacturing like every single other well populated country? and why does no one even seem to want to consider it?
The per capita GDP (PPP) of the Philippines is $7k, putting it ~120/185 in the world. It is nowhere near the poorest country.
It does have a growing industrial sector which employs around 14% of the workforce and accounts for 30% of GDP.
It isn't growing as fast as some countries. Usual obstacles are corruption and lack of stable government dedicated to growth.
The Bamboo network has chosen to not utilize the cheap labor available there. Why they havent? I guess maybe they have so much manufacturing already going on in Thailand, Vietnam, China, there may not be enough demand for higher wages in those places to cause manufacturing to move.
That does make sense. Indonesia also apparently is more competitive and has a population one quarter of Chinas, and Foxconn has barely broken the surface yet, so an untapped rival competitor faces the Philippines next door. I guess the fact that Indonesia which is more competitive than Philippines, has barely been tapped yet proves your point that not much need has been made for movement. India is a manufacturing bomb waiting to expllode I heard so I think the window of opportunity for Philippines has already closed. By the time India gets worn out, Africa willl have the infrastructure in place to completely take over.
I think Philippines might be in an unlucky middle. It is not cheap enough to get started with the low end stuff like textiles and shoes, losing out to Bangladesh, Sri lanka and even Ethiopia starting the trend of Africa winning over the Philippines. And the higher end manufacturing is both stuck with heavily devlloped countries, and also it is turning more to automation.
My predictions are that India, Indonesia and Vietnam are the last remaining countries to catch the last wave of opportunities to enter the manufacturing ladder to build up the value chain, before the window of opportunity closes, the cheapest stuff goes forever to Africa and the high end stuff gets locked into countries in Asia with existing supply chains, infrastructure and overall knowhow. Pakistan is a possible other, but I think that is it.
The per capita GDP (PPP) of the Philippines is $7k, putting it ~120/185 in the world. It is nowhere near the poorest country.
It does have a growing industrial sector which employs around 14% of the workforce and accounts for 30% of GDP.
It isn't growing as fast as some countries. Usual obstacles are corruption and lack of stable government dedicated to growth.
That is actually part of what I just posted though. the Philippines is in a "bad middle" it is not cheap enough to compete for the cheapest manufactuing, or lowest value goods whicch go to really impoverished countries. But also it is very uncompetititve in the high value goods which are locked into China and it's immdiate mainland neighbors, plus Taiwan, Japan, the upcoming Indonesia and upcoming India, plus the many wester countries that are developed in it. Also, GDP per capita says little about the true situtation of the average person. GDP per capita in some 3rd world countries is very high actually, but poverty is rife. inequality in Philippines is particularly bad. The dearth of manufacturing combined with sky high birth rate and terrifying inequality combines to make a perfect storm of problems.
After looking at satellite images of African cities you are put in shock by how much more dire the situation of every day lives for people in Philippines vs east Africa.
Kenya
Uganda
Manila
Cebu
I was shocked to see more slums and severe poverty places in the largest cities in Philippines than in places in Africa where slums are less widespread. It will only get even better for Kenya and Ethiopia when they gear up for manufacturing business.
While people in Africa enjoy a low cost of living, no crowdedness and living in safe residential locations, people in all large cities in the Philippines have to deal with crowded slums, some in very unsafe locations. If you see some things published about Tondo, you see that the ineqality has allowed the Philippines to foster portions of the world's absolute worst examples of poverty. Manila has he highest homeless population in the world.
All this is because for some reason, it is being skipped by manufacturers while its population explodes. Still not fully sure how this can happen like this.
Last edited by Santaronto; 07-14-2015 at 10:16 PM..
One missing component that will transform the PH is graft. If they get a handle on their corruption, they can go far, until then, they will continue to be the best international working force for the money.
My suspicions:
1. A legacy of corruption that goes back to the Marcos era.
2. Insurgency still in some southern provinces.
3. Infrastructure not up to snuff
4. An archipelago of islands makes for difficult road transportation.
I just read about electricity rates. Philippines is already the most expensive country in Asia for electricity, already writiing it off as a potential candidate for manufacturing and is heading for the most expensive eletricity in the world at the rate they are going.
Also it seems like both Manila and Cebu are suffering from a land crisis. Based on the population density, both need industrial land for the respective cities as big as the cities themselves already are. But they are completely squashed between mountains and the sea with no room for industrial sites. All the land in Metro Manila is already taken up and what is left beyond this is mountains that form an impenetrable barrier against industrial expansion. Undustrial zones require huge expanses of land and Manila and especially Cebu hardly even has a nook left between the crowds and the mountains to stick one factory inside. Also the ports are already to capacity with no room to even expand them because that too is all ocupied. They are hardly even into talks regarding how to find space for ports, much less ready to open some. So I think total saturation of land, port space and plus the high electricity cost is stunting the country madly.
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