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CITEM
Encore: Industry Link
By Michael Alan Hamlin
March 8, 2004
"An incredible success." That's how Department
of Trade & Industry (DTI) undersecretary and Board of Investment
managing head Gregory L. Domingo described e-Services Philippines
2004, the annual exhibition and conference meant to promote the
Philippines as a premier destination for e-Services investment.
"I was blown away by the number of people there," he told
me last week.
But it wasn't just the numbers present that impressed Domingo. Venture
capitalists, investors, and prospective customers from 14 countries
were present, including a 23-person delegation from Japan. Japanese
firms collectively are one of the largest investors in and purchasers
of design and engineering e-Services in the Philippines. In just
the short, two-day span of the exposition and concurrent congress,
the 110 exhibitors represented closed about US$1 million in new
business. Much more is expected to come.
e-Services Philippines is organized by the Center for International
Trade Expositions and Meetings (CITEM), a DTI attached agency. Investment
in e-Services sectors is estimated at P27.73 billion through December
last year. DTI says 68,500 jobs have been generated as a result.
Analysts expect strong job growth in these sectors to continue despite
the strident posturing of US politicians decrying the supposed loss
of jobs there in this election year. A substantial number of these
jobs will go to new e-Services industrial parks in Calabarzon, Cebu,
Central Luzon, Davao, and Dumaguete.
The Philippines has become such a popular site for e-Services in
such a short time - investment promotions began in earnest in 2001
- that some providers are cutting back planned investment in India,
and redirecting it to the Philippines. At least one call center,
Epixtar (Full Disclosure: CITEM and Epixtar are both clients of
my firm.) has decided to concentrate on the Philippines, and forego
expansion in India.
e-Services isn't all CITEM markets to the world. Other major projects
focus on construction materials, electronics, food, giftware and
holiday décor, home furnishings, marine products, motor vehicle
parts and components, wearables, and even organic and natural products.
The next big show is Industry Link 2004, which takes place March
25-26.
Industry Link was conceived to strengthen small- and medium-size
enterprise (SME) networks by providing a venue for updating the
sector on emerging business opportunities, and thereby to stimulate
domestic direct investment, especially among suppliers to the electronics,
automotive, and metal industries. Other objectives include capacity
building for SMEs, and building relationships with financial institutions
that can supply expansion funding.
Industry Link 2004 - called a buyer-seller matching program - is
at its core a sort of reverse trade fair, where participating multinationals
and original equipment manufacturers (OEMs) will showcase products
that they hope local suppliers can help build. Ernie Santiago, executive
director of the Semiconductor and Electronics Association in the
Philippines (SEIPI) says that many large manufacturing companies
are frequently unaware of the capabilities of local SMEs.
Santiago explains that local SMEs engaged in metal casting for appliances
and precision stamped parts are frequently capable of meeting the
quality and on-time delivery requirements of larger firms. However,
because these companies in effect have few ways to find each other,
both loose important opportunities. For suppliers, opportunity lost
means fewer opportunities to grow. For buyers, it means losing competitiveness-sapping
chances to lower costs.
Industry Link is meant to provide that missing communication link.
"By providing a venue where OEMs, multinational corporations,
and international procurement offices can meet with local suppliers,
Industry Link aims to bridge the gap and facilitate mutually beneficial
linkages between these companies for sourcing and procurement programs,"
according to CITEM caretaker Angelita Madulid.
"Our objective is to encourage direct investment with local
suppliers serving these companies," Madulid explains. "And
through Industry Link, we would like to see more SMEs in partnership
with big manufacturing companies." CITEM's long-term objective
is to build a network of globally competitive SMEs servicing product
and service requirements of large companies outside the Philippines,
as well as within.
Because so many large buyers of products and services are embracing
electronic procurement for productivity and cost efficiency reasons,
for example, this year's Industry Link will feature a B2B Forum.
The Forum will take up global trends in electronic procurement,
industry-specific procurement processes, procurement technology
designed specifically for SMEs, global productivity tools, and government
and financial assistance available to SMEs that desire to leverage
the benefits of electronic procurement.
The second day of Industry Link will be devoted to one-on-one meetings
with prospective customers. Some deals will probably be done then.
For others, the meetings will be the first important step in building
new, profitable relationships. Judging from CITEM's record selling
other Philippine sectors, Industry Link should be an important opportunity
for SMEs.
(Michael Alan Hamlin is the managing
director of consultancy TeamAsia and the author of three books on
Asian economies and companies. His latest book is Marketing Asian
Places, of which he is a co-author (Wiley, 2001), and he is currently
at work on High Visibility: The Making and Marketing of Asian Professionals
into Celebrities. Write him at mahamlin@teamasia.com.).
Copyright © 2003 Michael Alan
Hamlin. All Rights Reserved.
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