Road to Asean 2015: Cebu boosting its business sector’s competitiveness

THROUGHOUT history, Cebu City has already had the honor of having many “firsts.” Established by Miguel Lopez de Legazpi in 1571, it became the first city in the Philippines, ahead of Manila by seven years. It is the oldest city in the country, having the oldest and smallest fort (Fort San Pedro), the oldest church (Basilica of Santo Niño), the oldest school (University of San Carlos), and even the oldest street (Colon Street).

Today the Queen City down South boasts not just of its rich his­tory but also of being the only city in the Philippines with the perfect blend of a business center, a leisure destina­tion and a global events venue.

It started back in the 19th cen­tury, when the Island of Cebu had its rich and colorful metamorphosis, which allowed it to exercise a domi­nant role in the Philippines’s economic limelight. Because of its topography, agriculture mainly pushed Cebu into an economic success. But even more fundamental than the agricultural products was its participation in commerce. At present, Cebu has only further demonstrated its economic capability with an excellent track re­cord—for instance, its growth rate on export items, such as furniture, fash­ion, accessories, gifts, toys and house wares, has averaged close to 20 per­cent, considerably higher than that of any other province in the Philippines for the past five years.

This growth is credited to the fact that the island is the most accessible place in the Philippines, with more do­mestic air and sea linkages than any other city in the country. In fact, it is the base of over 80 percent of interisland shipping capacity in the Philippines.

Early this year Cebu City was ranked eighth in the 2014 Top 100 Outsourcing Destinations Report of Tholons, a US-based services globaliza­tion and investment advisory for global outsourcing and research firm. It was able to beat other high-profile locations in Europe, just trailing influential cities as Bangalore, Manila, Mumbai, Delhi, Chennai, Hyderabad and Pune.

As it expands retail establish­ments and welcomes a variety of global brands, Cebu City, along with Manila, has been considered as a top city for retail investments in the world. This was cited in a recent study by the Urban Land Institute and Pricewa­terhouseCoopers, titled “Emerging Trends in Real Estate Asia Pacific.”

Cebu City and the whole of Cebu Is­land is also the tourism gateway for the Central and Southern Philippines. It is a favorite vacation spot both by Filipinos and foreigners for its world-class re­sorts, beautiful beaches, offered leisure activities and laid-back lifestyle. The whole island has one of the best records for peace and order in the country.

Moreover, the development of Cebu’s infrastructure is stable. It has all the ingredients necessary to be competitive and to sustain invest­ments. It is considered a cosmopolitan area with all the support facilities and amenities for an ideal modern life­style, yet it is still more serene than Metro Manila. This is why Cebu has become among the favorite hosts of countless global occasions.

Property developers has also been experiencing inventory shortage because of a very high demand for mid­dle-market condominium units, espe­cially those that are around P60,000 to P75,000-per-square-meter range. As the market—including overseas Filipino workers and foreign nation­als who are looking to buying proper­ties here for retirement—demands for property, there is also a big clamor for developers to develop more proj­ects. This, despite the fact that most developers in the city offer midrange products.

This boom in real estate is due to the flourishing of the tourism indus­try, according to realty experts.

With the much-needed support from the government, especially in terms of roads and infrastructures, Cebu might see an even bigger boom in the real-estate industry.

In fact, the government is being trapped to support the five strongest industries in Cebu—shipbuilding, ag­ricultural products, business-process outsourcing (BPO), human capital that includes academe, and tour­ism—to make it more competitive, especially with the upcoming Asean economic integration, according to Asian Institute of Management ex­ecutive director Ronald Mendoza.

Mendoza said Cebu is already very competitive, but the govern­ment can help even more by creating policies that will support and promote these industries. Particularly, he pro­posed maintaining an active dialogue between the public and private sector to ensure that Filipino businessmen will be able to seize more opportuni­ties in the integration.

Likewise, assistance to small to medium enterprises should also be given to help them achieve competitive­ness and be ready for the integration.

Cebu Business Month 2014

THIS whole month of June, Cebu cel­ebrates its thriving business sector’s global competence. The Cebu Busi­ness Month (CBM), which is hosted annually by Cebu’s premier business association, the Cebu Chamber of Commerce and Industry (CCCI), is a venue used to showcase Cebu, as well as introduce its programs, thrusts and advocacies.

CBM 2014 overall Chairman Fe­lix O. Tiukinhoy Jr. said during the launch of the celebration that CCCI, as a business organization, has weath­ered not only the ups and downs of business but also the test of time— the 111 years of the chamber’s history are closely linked with that of the city and province of Cebu. He added that the flip side of challenges are oppor­tunities specifically from neighbor­ing nations, and these are the very reasons for this year’s CBM, which centers on what the economic integra­tion of the 10 member-countries of the Association of Southeast Nations (Asean) in 2015 will bring to Cebu.

“Our collective existence as a chamber is a key driver to national development and progress. Our mem­bers have put forward the example of responsibility and dynamism in the face of challenges, which now come in the form of the Asean 2015 integra­tion,” Tiukinhoy said.

CCCI President Ma. Teresa Chan also cited that despite the two di­sasters that hit the Visayas region last year, the chamber has only been made more inspired to make the month-long event even bigger and bolder this time.

“CCCI will continue to support the trade and industry in Cebu for a sus­tainable progress, and we hope to cre­ate more jobs, reduce poverty and im­prove the lives of the Cebuanos,” said.

This year’s activities focus on im­proving the different industries of in­formation and communications tech­nology (ICT), tourism and investment promotion, BPO, creative industries and entrepreneurship. All programs are aimed to address issues faced by the various sectors when the Asean becomes an integrated economic com­munity in 2015.

Among the major events was Tour­ism and Investments Night, where rec­ognition of Cebu’s top investors and business champions was held—a first for CCCI to give special recognition to groups and persons who helped boost Cebu as a major global tourism and in­vestment destination.

Event committee Chairman Sa­bino Dapat said each awardee showed cooperation, while being on top of competition can help a community. Ayala Group, one of the awardees, was particularly commended Dapat for helping Cebu’s economy through the two districts it developed, which is now “home to diverse enterprises,” including ICT/BPM industry.

For the ICT and BPO industry, CCCI has organized the 2014 Cebu ICT / BPO Conference and Expo on June 2 and 3 at the Marco Polo Plaza Hotel.

It was a conference that promoted Cebu’s standing as a leading global ICT and BPO hub. It discussed issues, benchmarks and trends in the ICT and BPM industry; shared opportunities and information among established and emerging ICT and BPM hubs; and highlighted investment oppor­tunities and local technopreneurship, particularly in Cebu. It also discussed how the growth of this sector could be sustained if it is linked with other thrusts of Cebu—creating a network of stakeholders toward a unified ef­fort elevating Cebu to a more exciting and powerful altitude.

A Tourism and Investment Fo­rum Program, on the other hand, was held on June 19, also at the Marco Polo Plaza Hotel. Among the points highlighted during the event were the Increasing Competitiveness for Inclu­sive Growth Program, which enables employment generation through increasing competitiveness in the economy; and the Local Governance Support Program for Local Economic Development, which aims to reduce poverty by strengthening local gov­ernance and supporting sustainable local economic development. It also talked about how sectors could raise the competitiveness of Cebu’s Mac­tan, considering that it has so much potential for tourism. Finally, the del­egates discussed about sustainability and resiliency in Cebu’s tourism in­dustry through a “greening” strategy.

Meanwhile, the third Creative Industries Summit showcases Cebu’s capabilities to integrate creativity and good design into industries and other aspects of business. It is an ongoing vibrant celebration of Cebu’s creative resources through various exhibits, competitions and fora—invigorating Cebu’s business community.

Finally, the CBM 2014 Entre­preneurship is being held for small and medium entrepreneurs to have an awareness of the implications of the Asean Economic Integration, and for them to develop specific business plans to mitigate threats while taking advantage of opportunities.

In relation to this cause, mar­keting guru Ned Noberto earlier this month had a talk to encourage Cebu homegrown businesses to go beyond the borders and become a national player. In succession to this, another forum on how a Filipino business could potentially become a global company was held on June 18. On June 24 the basics of successful ex­porting were discussed in a forum.

source:  Business Mirror

Standard Chartered banks on ASEAN integration to boost growth

LONDON-based Standard Chartered Bank sees the Association of Southeast Asian Nations’ (ASEAN) economic integration as a boost to its business in the region, with its regional chief executive noting the lender’s edge over homegrown banks in servicing companies eyeing expansion overseas

 

“I think ASEAN economic integration is a positive for us. Particularly, we are the only international bank that has got presence across all 10 ASEAN countries,” Standard Chartered CEO for ASEAN Lim Cheng Teck told BusinessWorld in an interview last week.

“The advantage for us is that we have been in this part of the world for more than 150 years, so we have long history and deep local knowledge in those ten markets across ASEAN,” Mr. Lim said, responding to a question on how prepared the bank is in attracting, as clients, Philippine conglomerates that are expanding abroad.

“That is a really strong advantage for many of our clients... because we have got deep local knowledge, and a good understanding of the regulations, the business practice,” Mr. Lim explained.

Mr. Lim’s remarks came as Standard Chartered pursues a new global strategy this year, after reporting its first drop in full-year profits in a decade in 2013.

The bank has recently subdivided its international businesses into eight regional blocs: ASEAN, Greater China, North East Asia, MENAP (Middle East, North Africa, and Pakistan), South Asia, Africa, Europe and the Americas.

The Singapore-based Mr. Lim, who was on a visit to Manila, was appointed CEO for ASEAN in April this year.

Standard Chartered makes most of its money in Asia. Last year, before the new regional groupings were introduced, Hong Kong accounted for 28% of the group’s total profit before taxation - representing the largest share.

This was followed by other Asia Pacific (16%) and Middle East and other South Asia (15%). Singapore accounted for 13%.

India accounted for 10%, Africa for 9%, and Americas, UK and Europe for 9%.

Under the new regional groupings, Mr. Lim said that Greater China and ASEAN represent the two largest blocs, each comprising about 25% - or together totaling half - of the group’s income.

Standard Chartered’s ASEAN grouping includes the 10 ASEAN economies and Australia.

Apart from banking on Southeast Asian conglomerates with regional aspirations for its growth prospects, Standard Chartered also has its sights trained on smaller firms.

“Now we are saying, we have only one business, but three segments: the corporate segment, the retail segment, and the commercial segment,” Mr. Lim said of the bank’s current strategy.

“We see a lot of potential in the commercial client space, because commercial clients typically are companies that are in the early part of their life cycles, where they would need support from banks as they continue to grow, and across ASEAN, many of the businesses tend to fall to the commercial kind,” Mr. Lim said.

He differentiated the commercial segment from the bank’s corporate banking business.

“Corporate banking’s where our clients have a much more sophisticated requirement. There will be that client that has got the ability to tap the debt and capital market. They can issue debt on their own. So these tend to be [of a] much bigger kind,” Mr. Lim explained.

“But there’s also a segment of clients that do not have that ability today.

These are the clients that we see [with] tremendous potential, particularly across ASEAN,” he said.

“I would say these are SMEs (small- to medium-sized enterprises).” -- Raymund Luther B. Aquino

 

source:  Businessworld