Agri, tourism, exports key to PH sustained growth

MANILA, Philippines – If the Philippines wants to sustain its status as a rising economy, it has to focus more on the basics, particularly agriculture, tourism and high-value exports, a marketing expert said.

In a press conference of the Philippine Marketing Association (PMA) on Thursday, June 6, marketing consultancy firm Business Mentors, Inc. president Willy Arcilla said the government needs to push these to further sustain the country’s growth momentum.

“Imagine what we can do together if we can ask the government to refocus on agriculture… make highly-valuable products that we can export, and push tourism more. There is so much potential,” he said.

Arcilla cited the delay of the full implementation of the Comprehensive Agrarian Reform Program (CARP) as one of the reasons why the country’s agriculture sector has been such a laggard.

CARP was first introduced in 1988 under the administration of former president Corazon Aquino with the aim of distributing farm lands to landless farmers.

However, the government, particularly the Department of Agriculture (DAR), failed to fulfill their end of the bargain and was only able to distribute around 111,889 hectares to 63,755 agrarian reform beneficiaries in 2011.

The target is to distribute around 220,000 hectares of farm land every year.

Arcilla said, instead of relying heavily on the CARP, the government and the farmers can pursue other alternatives including cooperative farming.

“Land reform is not a be-all and end-all solution. There are so many alternatives like cooperative farming. But there should be support including the fertilizers, roads and irrigation systems, among others.”

“All of these has to be addressed by the government,” he said.

Not just self-sufficiency

Arcilla also said the government should not just aim for self-sufficiency in terms of meeting domestic demand. There should also be abundance of supply of high-value products to strengthen the country’s export capabilities.

“We should not just focus on self-sufficiency but abundance so we can export like our high-grade rice, coconut, mangoes, bananas, pineapples,” he said.

He stressed the importance of moving up the value chain as part of the industrialization efforts of the country.

He cited two examples, particularly semiconductors and coconut water.

In the case of semiconductors, which is slowing down despite being the country’s foremost export commodity with almost 65% share of the country’s exports, he said we should move up the electronics value chain by producing more complete electronics products and not just parts.

Coconut water, on the other hand, has been gaining ground in the international market and Arcilla said the Philippines should focus more on building a Filipino brand than supplying foreign brands with these valuable commodities.

“Coconut water is in big demand now. President Aquino, with all due respect to him, said we are now exporting these to US brands. But I said no. We should come up with a Filipino brand because the value is in the brand, not in the raw material.”

“We should not be contented by just supplying foreign brands with our raw materials. We should be brave enough (to make our own),” he said.

In 2011, coconut water was hailed by Aquino as one of the country’s most promising new export opportunities with a growth rate of over 300% to 16.76 million liters from 4.4 million liters the previous year.

Local brand Fruits of Life has been profitting from coconut water and is exporting about 240 tons in cans and tetra packs a year directly to supermarket chains in the United States and China.

Some of the foreign brands dominating the coconut water market include ZICO, a US coco water brand majority owned by Coca-Cola.

Tourism

Tourism is also seen by marketers in the country as a potential driver for growth but stressed that the right infrastructures has to be in place if the government wants to attain its 10 million tourists goal in 2016.

“Tourism is a sector heavily dependent on marketing. The kind of marketing and promotion and marketing the government put out in the world is crucial in luring tourists to visit the country,” PMA president Vicente Reyes said.

“In terms of the infrastructure, it’s a chicken and egg situation. Infrastructure will be done when more tourists come. But number of tourists will also depend on the kind of infrastructure we have in the country,” he added.

In 2012, the country hosted around 4.3 million tourists. The government is expecting 5.5 million tourists to flock in the country this year, more than half of the 10 million tourists target in 206.

PMA is hosting the National Marketing Conference in Marriott Hotel in Pasay City on June 27 to 28, gathering marketing practitioners, entrepreneurs, business leaders and government officials to talk about marketing as an instrument to sustain economic growth. – Rappler.com