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I N C L U S I V E , I N N O V A T I O N - L E D G R O W T H

PHILIPPINEA P R I M E R O N T H E

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The Philippines, as one of the founding members of ASEAN, takes pride in hosting this year’s regional meet, which has the theme “Partnering for Change, Engaging the World.” Given that the organization is celebrating its 50th anniversary this year, we are also fortunate that we’ve been provided with an opportunity to strategically champion our advocacies within the region.

On top of our agenda is steering the ASEAN to full economic integration through greater trade and investment among our fellow ASEAN Member States.

Despite concerns that our country would lose in terms of trade or employment opportunities because of the ASEAN integration, the Philippines is actually well positioned to take advantage

D T I P U S H E S F O R INCLUSIVE, INNOVATION-LED G R O W T H I N A S E A N

F O R E W O R D

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of it. Among our country’s many strengths, we have our robust economic performance, improving competitiveness, and a huge supply of English-speaking workforce.

The integration will likewise provide an opportunity for Philippine industries and services to become a major player in the ASEAN region, even as it offers a bigger market for Philippine businesses.

Through our chairship, we also wish to reach the conclusion for the Regional Comprehensive Economic Partnership (RCEP) that will link the ASEAN—an economic powerhouse with a market of 600 million people—to its six Dialogue Partners. This would create an even bigger market of 3.5 billion people.

What does this all mean for the average Filipino? For consumers, this means more variety of goods and services at cheaper prices. For producers, this means cheaper prices of inputs from imports—which translates to more competitive prices for their products. For investors, this means having a single production base, even with the ASEAN’s diversity with regard to capital, expertise, labor, and resources. Of course, we cannot forget our micro, small, and medium entrepreneurs (MSMEs), who are at the front and center of our current trade agenda. For them, integration means Philippine products and services having easier access to the larger markets of the ASEAN and RCEP, while also heightening their competitiveness.

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Yours truly will serve as the chair of the ASEAN Economic Ministers Meeting even as the Department of Trade and Industry (DTI) chairs the ASEAN Committee on Business and Investment Promotion (CBIP). The latter committee will engage the international business community, the government, and other parties, as well as organize business and investment-related activities.

Last January 24, DTI officially unveiled business programs and events that will complement the Philippines’ priorities under the AEC pillar. These are: regulatory coherence; micro, small, and medium enterprises (MSMEs); innovation; and women and youth.

Among the thematic priorities developed by the Philippines for its ASEAN 2017 hosting, DTI’s priority agenda of “inclusive, innovation-led growth” is poised to champion the MSME mandate in the ASEAN through the following strategic measures:

(1) increasing trade and investment; (2) integrating MSMEs in the digital economy; and (3) developing an innovation-driven economy.

In these endeavors, all of our DTI partners, as effective vehicles of information, can help the government promote the Philippine hosting of ASEAN, as well as the ASEAN identity, to the greater number of Filipinos.

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T H E A S E A N E C O N O M I C C O M M U N I T Y

A N D T H E P H I L I P P I N E

CHAIRMANSHIP

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1. ASEAN is a region of significant economic and strategic importance, located in the heart of Asia and centered on important trading routes between Europe and Asia and the Pacific. It is composed of ten (10) Southeast Asian nations. The five (5) founding members, which established ASEAN in 1967 were Indonesia, Malaysia, the Philippines, Singapore and Thailand; Brunei Darussalam (joined in 1984), Vietnam (1995), Lao People’s Democratic Republic (Lao PDR) and Myanmar (both joined in 1997) and Cambodia (joined in 1999).

2. The Philippines took the helm of the ASEAN Chairmanship in 2017, eleven years after its last Chairmanship in 2006. This will be a grand year as ASEAN will mark and celebrate its 50th Anniversary.

• At the 28th and 29th ASEAN Leaders’ Summit in Lao

PDR, Philippines officially accepted the hosting of ASEAN Chairmanship in 2017.

• The Philippines officially launched the hosting of ASEAN Chairmanship in Davao on 15 January 2017. The ASEAN Business and Investment Program led by DTI was launched on 24 January in Malacañan Palace.

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3. The logo for Philippines 2017 ASEAN Chairmanship is represented by the following elements:

• Bright yellow sun, including its rays, represent ASEAN’s aspirations of prosperity and hopeful beginning for ASEAN@50

• Blue hand represents unity, which embodies ASEAN’s vision of solidarity among states.

• Dove of peace represents courage and dynamism.

• Stars represent the 10 ASEAN Member States, positioned even-handed to symbolize equality and active collaboration.

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4.The Philippine Chairmanship will bear the theme: “Partnering for Change, Engaging the World”. The theme captures Philippines’ resolve to consolidate ASEAN Community for its people with the sense of togetherness and common identity, ready and able to take its rightful place in the global community of nations. The theme is also in line with the current administration and the region’s pursuit to enhance cooperation with global partners to ensure that the

ASEAN citizens live in peace, stability, security, and growth while remaining ASEAN’s unity and solidarity at all times. As what the President conveyed at the September 2016 ASEAN Summit, the theme aims to highlight ASEAN as a model of regionalism and a global player, with the interest of the people at its core.

5. Philippines will focus on six (6) thematic priorities which encompass political, economic and socio-cultural aspects:

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A. A PEOPLE-ORIENTED AND PEOPLE-CENTERED ASEAN (ASCC)

B. PEACE AND STABILITY IN THE REGION (APSC)

C. MARITIME SECURITY AND COOPERATION (APSC)

D GROWTH (AEC)

E. ASEAN’S RESILIENCY (ASCC)

F. ASEAN: A MODEL OF REGIONALISM, A GLOBAL PLAYER (APSC)

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6. Three main messages for “promoting inclusive, innovation-led growth” as one of the key priorities set by the Philippines as chair for the ASEAN 2017 Summit:

• ASEAN AS A COMMUNITY THAT SUPPORTS INNOVATION LEADING TO INCLUSIVE GROWTH AND DEVELOPMENT.

• ASEAN IS A COMMUNITY THAT HEIGHTENS CONNECTIVITY AMONGST MEMBER STATES IN IMPROVING REGIONAL MECHANISMS (REGULATORY COHERENCE).

• ASEAN AS A COMMUNITY THAT PROVIDES BUSINESS OPPORTUNITIES THAT CATERS TO POTENTIAL INVESTORS, INCLUDING MSMES AND MNES.

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The Philippines, through the Department of Trade Industry has been forwarding the same agenda in the past with its key programs such as the implementation of the Startup Ecosystem Development Program, Negosyo Centers in the regions, Shared Services Facilities, National Trade Fairs, and the newly developed program that will introduce world-class MSME products, the Go Lokal! store projects.

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7. For the ASEAN Economic Community (AEC), the priority is “inclusive, innovation-led growth”. Under this priority theme, Philippines is poised to champion the MSME mandate in ASEAN and further leadership in areas of key economic interests i.e. Inclusive Business, in the regional and international fora. The AEC represents ASEAN’s goal to have an integrated and prosperous economic region where ASEAN people enjoy better lives. It supports ASEAN’s community building process through the establishment of free flow and exchange of goods, services, capital, and people.

AEC means opportunities for ASEAN, its members, and its people - the AEC is “we and us” not “they or them”.

INCLUSIVE BUSINESS

PROSPEROUS ECONOMICREGION

AEC BENEFITS FILIPINOS

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PROSPEROUS ECONOMICREGION

8. What does the ASEAN Economic Community (AEC) mean to us?

AEC BENEFITS FILIPINOS

• AEC offers consumers more and affordable products and services. Simplified trade rules and processes within ASEAN make this possible.

• AEC creates more employment opportunities by encouraging more trade and investments.

• AEC inspires more Filipinos to start their own businesses or internationalize their existing enterprises.

• AEC helps more Filipino professionals practice in any ASEAN Member State when qualification standards are harmonized. However, like all other ASEAN nationals, they will still need to meet domestic requirements in the ASEAN Member State where they intend to work.

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• Businesses could diversify their investments and/or choose to expand their markets overseas. There will be newer and more business models and approaches such as joint venture arrangements, overseas distribution, and outsourcing.

• Companies and entrepreneurs could offer a wider range of products and services.

• Qualified talents and skilled workers are free to move within the region.

• Cost of doing business could be reduced because of lower tariff, streamlined export and import procedures, easier access to suppliers, and better business licensing processes, among others.

• Improved public-private sector allows companies to better influence the business environment, clarifies rules affecting their operations and industries, and provides feedback and recommendations to regulators and legislators.

AEC MEANS MORE BUSINESS OPTIONS

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9. At the domestic front, the hosting presents a good opportunity to raise awareness and promote understanding of the AEC and Philippine participation in it and to mobilize support, integrate and harmonize public-private efforts toward taking full advantage of opportunities under the AEC. This is in conjunction with the good program Philippines has undertaken in formulating a clearer vision on how to collectively address the opportunities AEC presents as well as the challenges that industry faces to fully comply with AEC targets, such as in trade facilitation, trade in services, MSMEs, etc.

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10. With the substantial progress of AEC comes greater interest and confidence in the prospects and opportunities for businesses, both big and small. The sheer size of the MSME sector gives indication of why development of MSMEs would directly contribute towards achieving the objective of spreading the economic benefits more widely. First, MSMEs account for a big portion of the domestic workforce and output of many ASEAN members, cornering 95% - 99% of all business establishments, generated between 51% and 97% of employment in many AMSs. The contribution of MSMEs to GDP is generally significant, about 23%-58%, and contribution to exports ranges from 10%-30%. Second, since business players are preponderantly MSMEs, supporting their development is in fact not just for equitable development, but also for the competitiveness and robustness of the overall economy.

MSME

MSME

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11. High on Philippines’ hosting agenda for the economic pillar are deliverables geared toward instituting an enabling environment that allows MSMEs to develop and internationalize through policies that ease the cost of doing business and through support activities that nurture their continuous growth. ASEAN is cognizant of the need for more inclusive participation in the process of community-building, to ensure that the benefits of integration are fully realized and shared by everyone in the region.

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• The development of MSMEs was one of the priority areas in terms of ASEAN’s policy focus and resources. AEC 2025 Pillar 4 (“Resilient, Inclusive, People-Oriented, and People-Centered ASEAN”) reinforces the MSME-oriented mandate and props the significant work of ASEAN in providing an enabling environment for MSME development and internationalization.

• The ASEAN Strategic Action Plan for SME Development 2016-2025 (SAP SMED) lays down the operational framework for pursuing the goals of seamlessly integrating MSMEs with the AEC and the regional value chains (2016-2020) and transforming MSMEs to be globally competitive, innovative, inclusive and resilient (2021-2025). To ensure the delivery of these outcomes, the SAP SMED will focus on the key areas affective MSME growth:

(1) promote productivity, technology and innovation; (2) increase access to finance; (3) enhance market access and internationalization; (4) enhance policy and regulatory environment; and (5) promote entrepreneurship and human capital development.

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12. The Philippines’ priority deliverables span practical policies and support activities. ASEAN actively seeks new policies that are beneficial to MSMEs. As such, the creation of a sound policy environment and the introduction of the right mix of support programs are crucial to improve the capacity of MSMEs to extend and diversify. These initiatives will bring into greater focus Philippines’ concrete contribution to AEC, particularly in the achievement of equitable economic development. The results of these initiatives are expected to contribute towards helping MSMEs harness the opportunities presented by open and increasingly integrated markets.

13. Philippines ensures that the benefits of AEC are felt on the ground. Monitoring AEC-related initiatives is a significant undertaking towards a more systematic and robust method to achieve the goals of AEC 2025. Some of these initiatives are:

• Introducing a Review Exercise for AEC to further strengthen the monitoring of regional economic integration in ASEAN. This should be done by increasing the transparency and understanding of members’ level of implementation of AEC commitments.

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• The development of the ASEAN Trade Facilitation Indicator aims to have a more effective tool for measuring trade facilitation in the ASEAN region. In particular, this gives an indication of the overall trading environment in an ASEAN and country level. It also serves as a gauge for monitoring commitments and evaluating impact, improving coordination, and mobilizing dialogue and consensus on priority issues and activities, and leveraging external partnerships and cooperation.

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T H E A S E A N 2 0 1 7 B U S I N E S S

A N D I N V E S T M E N T

PROGRAM

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The Department of Trade and Industry chairs this year’s ASEAN Committee on Business and Investment Promotion (CBIP). For DTI, Undersecretary for Industry Promotion Group Nora K. Terrado serves as the Chairperson.

The Committee on Business and Investment Promotion (CBIP) is an inter-agency committee, created to assist the ASEAN-National Organizing Council (NOC) in the Philippines’ hosting of ASEAN 2017 (refer to Administrative Order No.48 s. 2016)1.

The CBIP is responsible for engaging the international business community, investors, government, the ASEAN Business Advisory Council, and other parties. In addition, CBIP is also at the forefront of organizing, as well as supervising potential business and investment-related activities.

The CBIP developed the ASEAN 2017 Business and Investment Program, with events and activities complementing and reinforcing the Philippines’ ASEAN 2017 hosting, focusing on Regulatory Coherence, MSMEs, Women and Youth Entrepreneurship, and Innovation.

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The competitive environment of ASEAN Economic Community (AEC) requires MSMEs to strategically enhance their productivity and address the current issues and challenges that ASEAN MSMEs would face in the next decade. This includes fostering an entrepreneurial culture by encouraging Filipinos to invest in their own businesses and become successful and innovative entrepreneurs; enhancement of the innovative capacity of the export sector through an efficient system of national innovation.

AEC is expected to bring benefits to MSMEs. The region’s integration and its openness to the global economy through its free trade agreements (FTAs) will attract investments from multi-national corporations MNCs of ASEAN’s own indigenous, large-scale enterprises, which provide MSMEs with opportunities including those wrought through value-chain integration.

All CBIP programs include MSME participation especially those with high potentials of penetrating the ASEAN and the global market.

KEY MESSAGESP R O M O T I O N A N D

G L O B A L I Z AT I O N O F M S M E S

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In today’s digital revolution, technology and innovation are considered as engines of growth with the stimulation of new industries. ASEAN embraces this challenge. It will help ASEAN economies to enable industries, fuel productivity, and harness the power of its young population.

The Philippine-hosting of the ASEAN 2017 is a strategic opportunity to showcase the rise of innovation and startup ecosystem in the country and the ASEAN region. This can be a platform to create ASEAN value chain, knowledge exchange and cross-border investments. The success of this summit can advance policies that can support and accelerate the innovation agenda.

At present, DTI implements the Startup Ecosystem Development Program (SEDP) which executes programs with other government agencies and the private sector powered by SlingShot Philippines.

INNOVATION-LED GROWTH

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ASEAN has maintained its efforts and support in the promotion of the status of women and has participated actively in the regional and international arena pertaining to the advancement of women.

Gender equality and women’s empowerment are integral principles in the ASEAN community building process. In October 2015, the Joint Statement of the 2nd ASEAN Ministerial Meeting on Women (AMMW) in Manila, recognized that “realizing these principles requires the commitment of all ASEAN Member States, sectoral bodies under the three pillars of ASEAN, and stakeholders including civil society, academia, media, and private sectors”

The UN estimates the Asia-Pacific economy would grow by an additional USD89 billion each year if women could achieve their full economic potential. Recent research likewise identified that by advancing gender equality and additional $900 billion could be added to East and South East Asian Economies, and additional 8% growth dividend (McKinsey 2015).

WOMENENTREPRENEURSHIP

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The country (Philippines) ranks as the 7th most gender-equal nation in the world and 21st in economic participation and opportunity according to the 2016 Global Gender Gap Report published by the World Economic Forum.

Through the ASEAN Women Entrepreneurs’ Network (AWEN), DTI provides an avenue for strategic dialogue between ASEAN, the private sector, and dialogue partners in advancing the women’s economic empowerment agenda. It is specifically expected to showcase how women are crucial partners in trade, leadership, and entrepreneurship, among others, supporting the goal set by the ASEAN Economic Community.

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We aim to engage and empower the young business owners, students, aspiring entrepreneurs, startups, and other stakeholders by creating an inspiring and encouraging platform through the ASEAN Young Entrepreneurs Carnival. It will provide an avenue to connect, interact, build relationships and network with regional linkages. It will also include plenary talks by keynote speakers, interactive panels and workshops, symposium, dynamic performances, awards and networking. The sessions will also help the delegates to be tapped in the challenges of entrepreneurship in the basic pillars such as access to finance, market, leadership, technology and networking.

STRENGTHENED CAMPAIGN FOR YOUTH

ENTREPRENEURSHIP

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CBIP developed programs that provide the business component of the priority themes and policies that the Philippines is advocating under the AEC pillar:

WHAT ARE THEPROGRAMS

L I N E D U P F O R A S E A N 2 0 1 7 C B I P

S.T.E.A.M Ahead in ASEAN: A Forum on Women and Technology (16-17 March): The event aims to bring together speakers representing various technology-driven enterprises to give women more ideas about opportunities in careers centered on Technology and Innovation. The advocacy is based on studies noting that women who pursue careers in STEAM (Science, Technology, Engineering, Arts and Math) are highly likely to earn 30% more income than in non-STEAM careers.

The ASEAN Creative Cities Forum and Exhibition (24-27 April): The Forum and Exhibition feature initiatives of 10 ASEAN countries in making culture and creativity a driving force for sustainable development and urban regeneration through the stimulation of growth and innovation and

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the promotion of social cohesion, citizen well-being and inter-cultural dialogue. Key influencers, advocates, and champions of Creative Economy and Creative Cities shall be providing insights and share their experiences in developing initiatives with proposals on how ASEAN can adopt the development of Creative Cities for the region and its role in sustainable and inclusive development.

Taste ASEAN at International Food Exhibition (IFEX) Philippines 2017 (19-21 May): The exhibition showcases the best food brands from ASEAN and its partner countries/regions. IFEX Philippines is the country’s biggest international trade exhibition on food and food-related products.

The ASEAN MSME Development Summit (13-14 July): Guided by the “The 7Ms Towards A Prosperous ASEAN Community”, this Summit serves as a platform for ASEAN MSMEs to cultivate a productive and innovative mindset in starting and expanding their businesses within the landscape of the ASEAN Economic Community.

ASEAN Women’s Business Conference (28 August – 1 September): With the theme “Women Leading Change”, this conference promotes efforts to create a gender

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responsive ASEAN Economic Community (AEC) by strengthening the role of women, including increased access to finance; and strengthening the role of the private sector. It also supports the ASCC Blueprint on achieving gender equality and empowerment of women.

The 2nd ASEAN Young Entrepreneurs Council (5 September): The Summit strengthens the network among young entrepreneurs from ASEAN and other countries capturing the fast-paced developments on key sectors. The ASEAN Young Entrepreneurs Association (AYEC) Charter, which serves as the commitment to strengthen ties, foster cooperation, and develop linkages among young entrepreneurs in ASEAN, is set to be formally launched at this event.

ASEAN Inclusive Business Summit (6 September): The Summit highlights the role of businesses in achieving national and regional development goals, as well as the role of governments in creating an enabling environment to allow Inclusive Business models to thrive. The Summit shall provide an overview of the IB landscape in ASEAN and showcase examples of successful IB models in partnership with local and/or national governments in the region.

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Slingshot@ASEAN (20 October): Driven by the vision of a thriving innovation economy across the ASEAN region, it aims to create a regional network of ASEAN ecosystem players including startups, angel investors, incubators, mentors, academe, co-working spaces, and industry experts. It showcases investment-ready startups for potential local and international investors as well as facilitate easy access of information between governments running startup development programs in the region.

Creative Marketplace (20-22 October): This event is a platform for professionals, talents, startups, designers, makers, idea generators, and content creators from the creative industry to gather, network, and catalyze new businesses.

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FOR MORE INFORMATION, KINDLY EMAILcbip.asean2017@dti.gov.ph

OR VISITwww.dti.gov.ph/aseancbip

www.asean2017.ph