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The Philippine Chemical Masterplan
August 1, 2013
Bobby Batungbacal, PresidentSamahan sa Pilipinas ng mga Industriyang Kimika
Samahan sa Pilipinas ng mga Industriyang Kimika
PROFILE OF THE CHEMICAL INDUSTRY
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Global Chemical Market
• One of the largest trade-able products in the
world worth US$ 6 trillion in total trade.
• Chemicals touches nearly 90% of all manufactured products
Market sizesEU -US$ 600 billionUS - US$ 500 billionChina – US$ 300 billionBelgium, France, Japan – US$ 200 billion each
Benefits of Chemistry to Society
• Enables modern life
• Pharmaceutical, cleaners, disinfectants, plastic packaging to saves lives
• Chlorine for safe drinking water
• Fertilizers, pesticides, biotech increase food production
• Chemistry to reduce CO2 emissions & enables renewable energy
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Philippine Chemical Industry
• 3rd largest manufacturing sub-sector– 147,000 direct workers– Php 24 billion in direct salaries and wages– Php 336 billion in revenues, 7% g.r. in last 5 years– 1,405 chemical manufacturers
• Rapidly growing chemical trade– US$ 9 Billion in total trade in 2011– US$ 7 Billion imports at 13% g.r. in last 5 years– US$ 2.5 Billion in exports at 17% g.r. in last 5 years– Exporting to 177 countries
• Highly diverse and highly regulated– 55,000 chemicals registered– Advanced and comprehensive EHS regulations– Pro-active private sector regulation thru Responsible Care
Source: NSCB 2011 National Accounts at Current Prices, NSO-ASPBI 2009, 2011 Global Trade Atlas
Chemical Sectors & Products
BASIC CHEMICALS
Resins
Basic chemicals
Gases
Organics
Inorganics
Alcohols
CHEMICAL PRODUCTS
Pharmaceutical
Soap & Detergents
Paints, Inks
Cosmetics
Fertilizers
Pesticides
Adhesives
RUBBER PRODUCTS
Tires
Industrial products
Re-threading
PLASTIC PRODUCTS
Plastic articles
Plastic products
Pipes and tubings
Industrial products
Films, sheets
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Philippine Chemical Manufacturing Industry(Php 336 Billion)
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PSIC Codes: D241, D242, D251, D252 Source: NSO, 2009 ASPBI
D241: Basic Chemicals (Php 48.3 billion)
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D242: Other Chemical Products(Php 177.5 Billion)
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D251: Rubber Products(Php 16.8 Billion)
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D252: Plastic Products(Php 81.3 Billion)
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Industry Value Chain
Raw Materials
• Air Minerals Water Oil (Naphtha)
• Natural gas Plants Coal
Intermediates
• Hydrogen *Nitrogen *Oxygen *Chlorine *Carbon Oxide *Caustic Soda *Soda Ash *Chlorine*Hydrochloric Acid *Sulfuric Acid *Phosphoric Acid *Ethanol *Ethylene *Propylene *Benzene *Toluene *Xylene
Primary Products
• Surfactants *Industrial Gas *Fertilizers *Agricultural Chemicals *Petrochemicals *Oleochemicals (cocomethyl esters, fatty acid & alcohols, glycerine)*Plastics (PE,PP, PVC, PS)* Pigments and additives*Bioethanol*Others: calcium carbide*carbon black*activated carbon*hydrogen peroxide*ammonium nitrate
Chemical Products
• Plastic products Rubber products Explosives
• Coatings and Inks Adhesives Pharmaceuticals
• Soap and detergent Cosmetics Oil & Fat products
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Responsible Care
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Pollution Prevention Code
Process Safety CodeEmployee Health and
Safety Code
Distribution Safety CodeProduct Stewardship
Code
Community Awareness and Emergency Response Code
Security Code60 CountriesIn Philippines
since 1995
Voluntary self-regulation
Chemical Trade Growth
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IMP
OR
TSEX
PO
RTS
Ave G.R: 13%
Ave G.R: 17%
THE PHILIPPINE CHEMICAL MASTERPLAN 2030
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Philippine Chemical Masterplan
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Strong Philippines
2016
Chemical Industry Council
Petrochem integration
R&D 0.5% of Revenue
US$ 5 billion exports
75% practice RC
Enter ASEAN+42022
Domestic feedstockDiversification &
expansionUS$ 10 billion exports
GLOBAL CAPTURE
2030
3rd largest export
US$ 30 billion exports
Strategic Vision
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• Create a wide range of products by leveraging our comparative advantage1. DIVERSIFIED
• Satisfy the domestic demand and be a leading contributor to the Philippine export basket2. POSITIVE TRADE
• Promote a high level of workforce productivity3. PRODUCTIVITY
• Be innovative, both in products and processes4. INNOVATION
• Develop and manage the industry sustainably to protect the natural assets on which the industry depends5. SUSTAINABILITY
• Be competitive as an industry so as to provide benefits to the Philippine economy and to the Filipino people6. INCLUSIVE
RECOMMENDATIONS TO GOVERNMENT
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GOVERNMENTGOVERNMENT
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Engineering and Science Advanced Technology Program (EnSAT Program)
ACTION PLAN RESPONSIBLE ENTITIES
Send engineers and science graduate to master and PHD
program in other countries;
CHED, DOST, Philippine universities’ Center of
Excellence in Engineering and Sciences
Develop industrial training programs towards acquiring and
applying expertise/knowledge on specific chemical industry
technology needs
Chemical companies in the Philippines, mother
companies, foreign partners, foreign
universities, National research Council of the
Philippines
Develop technology and skills preparedness program for high
school graduates
Tesda, LGUs, Philippine Science High Schools
Develop training programs for skills needed in the downstream
industry using chemicals like plastics, paints, adhesives,
oleochemicals, etc.
TESDA, Chemical Companies
Develop skills for grassroots entrepreneurial capabilities for
applied technology for new application products/indigenous
materials/green products
DTI, DOST
Science and Technology based Legislation and Policy
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ACTION PLAN RESPONSIBLE ENTITIES
Use of scientific studies and methodologies to
guide legislative processes in Congress and
local councilsSenate, Congress, DENR, DTI,
LGUs, DENR, Civil societies groups
(NGOs)
Presence of technocrats as part of standing
committees to craft policies and legislation for
the industry
Legislate information dissemination programs
for the public to fully understand the use and
disposal of chemical products
Curb eliminate tax evasion & smuggling
through proper and strict implementation of
laws
Establishment of the Chemical Industry Cluster Zone
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ACTION PLAN RESPONSIBLE ENTITIES
Identification of chemical industry cluster location
• Chemical industry
• DTI
• BOI
• Senate and Congress
• DOLE
• DOE
• DENR
Identification of sectors in the chemical industry that will locate in
the cluster zone
Institutionalize incentive programs (Replicate PEZA incentives) for
companies in the cluster zone that will supply products for
domestic needs
Subsidies on infrastructure for cluster zone locators
Tapping SMEs in the downstream market to be part of the
industry cluster
Develop a master plan for the creation of the chemical industry
cluster for the domestic market similar to the Jurong Island
Rationalization of processes to allow backward and forward
integration
Expansion of infrastructure services to the zone
OUTCOMES & MEASURESGOALS OBJECTIVES/OUTCOMES INDICATORS
1. Create a wide range of products
with the best consumer value by
adding value to the nation’s basic
resources
New product offerings that:
• Are competitive in price, quality and service
• support forward integration to consumer goods
• are for environmental applications
• are diversified and differentiated
Number of products introduced for specific markets and uses;
products with comparative advantage
Available and sufficient feedstock Domestic supply of raw materials
Increased utilization and patronage of local raw
materials
Number of products developed using local raw materials
2. Satisfy the domestic demand and
be a leading contributor to the
Philippine export basket
An industry that is a net exporter Import /Export Data
3. Promote a high level of workforce
productivity
A cadre of skilled, trained and motivated workforce that
have high levels of productivity
Labor productivity
4. Be innovative, both in products
and processes
Innovative products and processes - Number of patents and trademarks applied for
- New technology produced
- Number of new products and processes introduced
- Number of technology licenses
5. Develop and manage the
industry sustainably to protect the
natural assets on which the
industry depends
Chemical companies’ adherence to sustainability and
Responsible Care principles
- Number of companies with RC and Environmental
Management Systems (ISO 14001, ISO 26000)
- EMB data on chemical industry
- New management system on sustainability
- Number of active programs by companies
6. Be competitive as an industry
so as to provide benefits to the
Philippine economy and to the
Filipino people
Top export performance Trade performance
New chemical MSMEs Number of SME partners developed
Significant contribution to GDP - Share to GDP
- Employment
- Investments
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RECENT UPDATES ON THE ROADMAP
1. Ease of Doing Business
(a) EMB and FDA have replied positively, by issuing circulars, to our request for facilitation of issuance of government permits.
2. Science and Technology and Workforce Productivity
(a) ERDT has assigned 10 scholars to SPIK to do applied research for the chemical manufacturing companies.
(b) TESDA has already identified the required technical skills for the chemical industry, to be included in TESDA's curriculum.
3. Innovation
(a) DOST-PCIEERD has agreed to collaborate with SPIK in the holding of 2nd SPIK INNOVATION FAIR in the DOST compound in December.
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Summary
• The Philippine chemical industry is highly strategic to the Philippine economy.
• Manufacturing and trade is rapidly growing
• Need to diversify our products thru research, production and trade.
• Leverage on chemicals with comparative advantage.
• Support the Philippine Chemical Masterplan and the vision of US$ 30 Billion exports by 2030.
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