Republic of the

Philippines

SELF-ASSESSMENT REPORT ON THE APEC

SME INNOVATION PLAN

Republic of the Philippines

1

Republic of the

Philippines

Area A: Developing human resources and technology through linkage between industry and educational and research institutions

Rating: 21 If there are no such processes

2 If there are such a process, but it has not been effective, or if such a process is to be introduced in the near future

3 If there are no such processes, but SMEs already have effective measures, or if the member economy believes that no such processes are necessary, or if the member economy feels that the effects on SMEs are already adequately considered

4 If there are such processes, and it is effective

5 If there are such processes, and it has been very effective, and can be considered APEC best practice

Republic of the

Philippines

Area A: Developing Human Resources and technology through linkage between industry and Educational and Research Institutions

Common Evaluation

2

Initiatives • Philippine IPR law• Enacted Republic Act 10055 or the “Philippine Technology Transfer Act of 2009

to support commercialization of technologies• Multi-sectoral consortiao Filipinnovation Network o Philippine Research, Education and Government Information Network (PREGINET)o Engineering Research and Development for Technology (ERDT) Consortium

• Budgetary support (0.012% of GDP on R&D)• Provision of patent application of SMEs• 50% reduction on the rates for patent and trademarks applications• Facilitation in patent application through TAPI• 14 key agencies to support technological advancement &

setting up of technology business incubators to support innovative start ups

Key Issues • Lack of specialized support to innovative SMEs• Viability of TBIs• Low R&D budgetary support• Implementation of existing laws

Republic of the

Philippines

Area B: Access to specialist assistance and advice

Rating: 11 If such advice is offered

2 If such advice is offered, but it has not been effective, or if such program is to be introduced in the near future

3 If no such advice is offered but the member economy believes that no such advice is necessary

4 If there are such programs to offer such advice, and they have been very effective

5 If there are such programs to offer such advice, and they have been very effective, and can be considered APEC best practice

Republic of the

Philippines

Area B: Access to specialist assistance and adviceCommon Evaluation

1

Initiatives • Multi-sectoral consortia• Affordable and stable digital infrastructure• E-commerce and ICT awareness training• Financing for technology build up• 14 key agencies supporting technological advancement • Setting up of technology business incubators• SME centers nationwide• Specialized science high schools, undergraduate, graduate and post-graduate studies

scholarship programs in science related fields of study• Provision of consultancy services from TAPI

Key Issues • Upgrading the skills and knowledge of specialists• Improving SMEs’ access to specialist assistance • Availability of latest technologies and facilities at subsidized rates• Creating creative and innovative attitude among the citizenry

Republic of the

Philippines

Area C: Enhancing availability of capital to innovative SMEs

Rating: 41 If there are no such programs

2 If there is such a program, but it has not been effective, or if such a program is to be introduced in the near future

3 If there are no such programs, but if the member economy believes that no such programs are necessary, or if the member economy feels that the effects on SMEs are already adequately considered

4 If there are such programs, and it is effective

5 If there are such processes, and it has been very effective, and can be considered APEC best practice

Republic of the

Philippines

Area C: Enhancing availability of capital to innovative SMEsCommon Evaluation

4

Initiatives • Various programs to help SMEs adopt technological innovations

Consultancy for Agricultural Productivity Enhancement (CAPE)Small Enterprise Technology Upgrading Program – DOST Academe Technology-Based Enterprise Development (SETUP-DATBED)Manufacturing Productivity Extension (MPEX)Venture Financing for Environmentally-Sound Technologies (VFEST)Science and Technology Experts Volunteer Pool (STEVP)

• Tax incentives to inventors under RA 7459, “Inventors and Invention Act of the Phil.”• Technology exposition and trade fair programs• Rediscounting facility for local IT providers to help SMEs purchase/adopt new technology• Risk-based approach in extending loans to SMEs• Credit guarantee to SME loans by SB Corporation• Invention Guarantee Fund (under the Development Bank of the Philippines)• Streamlining of financing procedures • GFI-wide promotion to streamline SME’s financial procedures under the

“SME Unified Lending Opportunities for National Growth (SULONG or to move forward)

Key Issues • Ability of innovative SMEs to pass credit-rating system• Few venture capitalists to help build capital requirements of innovative SMEs

Republic of the

Philippines

Area D: Network and clustering for Innovative SMEs

Rating: 41 If there are no such mechanisms

2 If there is such a mechanism, but it has not been effective, or if such a mechanism is to be introduced in the near future

3 If there are no such mechanism, but SMEs already have effective measures; or if the member economy believes that no such mechanism is necessary

4 If there is such mechanism, and it is effective

5 If there is such mechanism, and it has been very effective, and can be considered APEC best practice

Republic of the

Philippines

Area D: Networking and clustering for innovative SMEs Common Evaluation

4

Initiatives • Omnibus Investment Code (E.O.226) • Export Economic Zone Act• Technology business incubator (i.e., UP-Ayala Technohub)• One-town One-Product Program (OTOP)• MSMED Council and Provincial MSMEDCs• Creation of websites and databases• Linkages to international sites (APEC innovation website)

Key Issues • Lack of TBIs for innovative SMEs• Lack of innovative SMEs

Republic of the

Philippines

Area E: Establishing appropriate legal and regulatory structure

Rating: 41 If there are no such process

2 If there is are a process, but it has not been effective, or if such a process is to be introduced in the near future

3 If there are no such processes, but if the member economy believes that no such processes are necessary, if the member economy feels that the effects on SMEs are already adequately considered

4 If there are such processes, and it is effective

5 If there are such processes, and it has been very effective, and can be considered APEC best practice

Republic of the

Philippines

Area E: Establishing Appropriate Legal and Regulatory Structure Common Evaluation

4

Initiatives • Intellectual Property Code of the Philippines (RA 8293)• Inventors and Invention Incentive Act of the Philippines (RA 7459)• Standards Law (RA 4109)• 10% mandatory on government institutions requirements on goods and services to be

purchased from MSMEs• Creation of the MSMED Council – the highest policy-making body for MSME promotion

and the voice of the MSME sector• Mounting of National Inventor’s Week

Key Issues • Absence of mechanisms/structures to review effects of possible legislations• Monitoring of policies and programs

Republic of the

Philippines

Area F: Establishing a market consistent economic environment

Rating: 41 If there are no such programs

2 If there is such a program, but it has not been effective, or if such a program is to be introduced in the near future

3 If there are no such programs, but if the member economy believes that no such programs are necessary, or if the member economy feels that the effects on SMEs are already adequately considered

4 If there are such programs, and it is effective

5 If there are such processes, and it has been very effective, and can be considered APEC best practice

Republic of the

Philippines

Area F: Establishing a Market Consistent Economic Environment Common Evaluation

4

Initiatives • Foreign Investment Act• Competition policies (i.e., Philippine Constitution, Price Act, Consumer Act, Intellectual

Property Code of the Philippines, Corporation Code of the Philippines)• Enforcement/monitoring of unfair trade practices (i.e., Tariff Commission, Bureau of

Import Services, Securities and Exchange Commission, Bureau of Trade Regulation and Consumer Protection)

• Industrial Linkages (Big Enterprise-Small Enterprise (EBESE) Productivity Improvement Program, Center-Satellite, Backward linkage)

• Stable macroeconomic indicator• Facilitation in overseas markets (i.e., elimination of export fees, travel tax exemption,

participation in international exhibits, etc)

Key Issues • Compliance to international quality standards• Free entry and exit to the market

Republic of the

Philippines

Area G: Developing methodologies for effectively measuring progress in the implementation of innovation programs for SMEs

Rating: 41 If there are no such programs

2 If there is such a program, but it has not been effective, or if such a program is to be introduced in the near future

3 If there are no such programs, but if the member economy believes that no such programs are necessary, or if the member economy feels that the effects on SMEs are already adequately considered

4 If there are such programs, and it is effective

5 If there are such processes, and it has been very effective, and can be considered APEC best practice

Republic of the

Philippines

Area G: Developing Methodologies for Effectively Measuring Progress in the Implementation of Innovative Programs for SMEs

Common Evaluation

4

Initiatives • Private sector involvement in policy formulation (i.e., MSMED Council, chambers, industry

associations)• SME information support (i.e., SME section at the DTI website)• National Research Council of the Philippines• SME Agency (DTI-BMSMED)• Knowledge exchange (i.e., PREGINET)

Key Issues • Establishment of private sector feedback mechanism• Harmonization of private and government efforts• Slow legislative process

Republic of the

Philippines

Thank you