Global Entrepreneurship the Philippines
Essay Preview: Global Entrepreneurship the Philippines
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I have chosen the Philippines as the country of operations for my automotive parts sales and export business. First a little history, the Philippines was a vital trading center for the Spanish from 1521 until 1898, after which it became an American colony. The Philippines became independent in 1946, and is the third largest English-speaking country in the world.
The countrys economy has showed resiliency amidst the Asian financial crisis, and is boosted mainly by its export-oriented manufacturing sector, particularly in electronics and automotive parts. The creation of export processing zones, including the former United States bases in Subic and Clark, has facilitated a rise in foreign direct investment. The Philippines has pursued a policy of economic liberalization in the past decade, which has resulted in the liberalization of its retail trade, telecommunications, banking, mining, oil sector, and more recently its power sector.
The Philippine government is currently implementing reforms to strengthen its economy.
It has recently enacted the Optical Media Act that strengthens intellectual property rights protection, and has advanced the government-wide use of the e-procurement system to promote transparency in government purchases. It has strengthened its regulations in the banking sector, and is undergoing fiscal consolidation through the strengthening of the tax base and tightening of spending, in line with its Medium-Term Development Plan.
Ford Group Philippines announced plans to hire more workers by August. Since this growth will most likely boost the business of its suppliers, a total of 1,200 potential new jobs is expected be created.
This was revealed by Henry Co, Ford Group Philippines president, in an exclusive interview with the Manila Times.
Co said that the firm will hire 400 new workers and will be adding a second shift at its plant. The second shift will be driven largely by the firms export program.
Ford has about 8 percent of the market share in the Philippines, and its export sales far outpace its local sales.
Ford projects to export 12,000 units this year. More than 1,600 have already been exported in the first quarter alone. Ford has exported about 28,000 units to various ASEAN countries since the launch of its Ford Export Program in 2002. That program has generated at least $380 million in sales from vehicles made in the Philippines. Last April, Ford rolled out its 30,000th unit earmarked for export.
All of these have been a boon to Sta. Rosa, where Ford gets most of its workers, mostly fresh graduates from underprivileged families.
“But theres a finite number (of prospective recruits) from Sta. Rosa,” Co said. “Were going all the way to Cebu and Mindanao to get people.”
He later added, “If we go second shift, some suppliers will also go second shift.” The total job gain could be three or four times the 400 additional workers Ford will be hiring, Co explained.
Ford works with 61 local parts makers to procure about 1,500 parts.
Fords P4-billion, state of the art plant in Sta. Rosa has a capacity of 36,000 units a year, expandable to 50,000 units a year. The plant is capable of producing at least four different vehicle platforms.
The Filipino workforce is one of the most compelling advantages the Philippines has over any other Asian country. With higher education priority, the literacy rate in the country is 94.6% – among the highest. English is taught in all schools, making the Philippines the worlds third largest English-speaking country. Every year, there are some 350,000 graduates enriching the professional pool.
The Philippines is located right in the heart of Asia – today the fastest growing region. It is located within four hours flying time from major capitals of the region. Sited at the crossroads of the eastern and western business, it is a critical entry point to over 500 million people in the ASEAN market and a gateway of international shipping and air lanes suited for European and American businesses.
An open economy allows 100% foreign ownership in