Thursday, April 25, 2024

Philippine Exports Surpass USD 100 Billion Milestone in 2023, Driven by IT-BPM and Tourism Sectors

Philippine Exports Surpass USD 100 Billion Milestone in 2023, Driven by IT-BPM and Tourism Sectors

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Department of Trade and Industry (DTI) Secretary Fred Pascual announced that, for the first-time, Philippine exports breached USD 100 billion in 2023.

Following the release of the Bangko Sentral ng Pilipinas (BSP) BPM6 data, Director Bianca Sykimte of the DTI-Export Marketing Bureau (EMB) shared that the full-year total exports of both goods and services reached USD 103.6 billion, marking a 4.8% increase from the previous year.

This growth has been driven by the strong performance of the information technology and business process management (IT-BPM) sectors and a turn-around in tourism revenues.

Secretary Pascual highlighted that the DTI has been working closely with the IT and Business Process Association of the Philippines (IBPAP) and its partner associations including the Animation Council of the Philippines (ACPI), the Game Developers Association of the Philippines (GDAP), and the Healthcare Information Management Association of the Philippines (HIMAP); to deliver interventions responsive to the needs of industry players.

In 2023, the Philippines participated in several European trade fairs, supported by the ARISE Plus Philippines Project, to enhance the global presence of the Philippine game development and animation sectors. The participating companies also benefited from tailored coaching initiatives from both local and international experts.

Furthermore, the Philippines strengthened its position in the global healthcare information management sector through sustained engagement in the Americas, including an outbound business matching mission and participation in the HIMSS Global Health Conference.

On Tourism, Secretary Pascual praised the Department of Tourism (DOT) under the leadership of Secretary Christina Frasco for its dual success in developing travel connectivity to the Philippines’ gateways and in galvanizing local government units (LGUs) and stakeholders to enhance the appeal of local tourism destinations. Consequently, for the first time in 15 years, the Philippines achieved a surplus in tourism revenues.

Secretary Pascual also recognized the significant efforts and leadership of the DOT in reviving the country’s tourism industry through the National Tourism Development Plan (NTDP) 2023 to 2028. In line with the NTDP, the DOT launched an aggressive campaign to realize its vision of making the Philippines a tourism powerhouse in Asia.

Travel services more than doubled its level from last year, reaching USD 9.1 billion in 2023. The Philippines welcomed more than five million international visitors, 91.8% of whom were foreigners, while the rest were overseas-based Filipinos.

That same year, the Philippines received 15 prestigious travel and tourism awards in various categories, including diving, beach, cruise, culinary, retirement, and Muslim-friendly tourism.  The country also earned major accolades from the World Travel Awards (WTA):

  • 2023 World’s Leading Dive Destination,
  • World’s Leading Beach Destination,
  • the World’s Leading City Destination for Manila,
  • Asia’s Best Cruise Destination, and
  • Asia’s Leading Dive Destination.

Goods exports faced challenges, with electronics exports declining by 3.4% or USD 955 million compared to 2022, according to BSP data. This decline highlights the importance of diversifying export portfolios and enhancing competitiveness in key sectors.

Other factors contributing to the decline in merchandise exports were coconut products, other agro-based items, other mineral products, and petroleum products. Conversely, fruits and vegetables experienced an increase in demand.

In contrast, Philippine services exports emerged as a powerhouse, with the sector experiencing a significant expansion of 17.4%, driving much of the overall export growth. Travel services contributed nearly 70% of the incremental services export receipts in 2023, followed by other business services. Growth was also driven by sectors including telecommunications, computer and information services, and transport services.

Services exports continue to be a significant contributor to economic growth, recording some of the strongest growth and increasing its share of gross domestic product (GDP) from 12% in 2022 to 13% in 2023.

However, the overall contribution of exports to economic growth was dampened by weak external demand in the goods sector. In 2023, total exports accounted for 27% of the country’s GDP.

The DTI has been actively pursuing initiatives to capitalize on the strength of the services sector and address challenges in merchandise exports. These efforts include expanding the services industry’s reach by entering new markets and strengthening existing ones, as outlined in the Philippine Export Development Plan (PEDP) 2023-2028.

Regrading export markets, based on the data of Philippine Statistics Authority (PSA), the United States of America (USA) remained the top destination for Philippine merchandise exports, accounting for USD 11.5 billion or 15.7% of the Philippines’ total merchandise exports. Japan, China, Hong Kong, and Singapore followed as top export markets. Notably, exports to India increased by nearly 53% in 2023.

Among the varied performance of merchandise exports, the DTI has intensified efforts to address key issues affecting export competitiveness, including value-added tax (VAT)-related concerns, and green laning of Philippine exports. Additionally, the Department has conducted numerous “Usapang Exports” or Export Talks sessions nationwide to inform businesses about market opportunities and regulatory updates.

The DTI is also leveraging technology and digital services to enhance export capabilities. This includes the launch of a free e-curriculum for Philippine exporters and the implementation of the “Origin Management System for the Promotion of Free Trade Agreements (FTAs) in the Philippines” project.

“The path to global excellence and export growth requires shared ambition, where the government and the private sector must intensify and sustain collaborations. Our guideline is the Philippine Export Development Plan (PEDP) 2023-2028, which aims to address constraints to production, diversify and improve access to markets, and develop a strong and innovative export ecosystem,” said Secretary Pascual.

Secretary Pascual added, “We recognize the ongoing challenges in both the domestic and global trading environments and hope to address the binding constraints to Philippine export competitiveness as we continue to implement the PEDP for 2023 to 2028. Each exporter counts, and with cooperation, we can open the door to a future in which Philippine exports have increased their mindshare in the global market, underpinned by global competitiveness and innovation.”

While acknowledging the challenges posed by the dynamic global market, the DTI continues to work collaboratively with Philippine exporters and other relevant stakeholders.

DTI remains committed to addressing the concerns of exporters by developing tailored programs and services aimed at empowering businesses and enhancing their competitive edge.

For inquiries regarding exports, please send an email to DTI-Export Marketing Bureau (DTI-EMB) at exports@dti.gov.ph or you may visit tradelinephilippines.dti.gov.ph.