February 25, 2024

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DTI Highlights IR 4.0 Plans for the Philippines’ Manufacturing Sector

DTI IR 4.0 Plans for Philippines Manufacturing Sector

The Philippines’ Department of Trade and Industry (DTI) is in the thick of preparations to revitalise the country’s manufacturing and embrace Industry 4.0, as it surges forward with its flagship industrial strategy.

The program, called the Inclusive Innovation Industrial Strategy (i3s), was introduced in 2016.

The Situation in the Philippines

According to a recent press release, DTI Secretary Ramon M. Lopez recently provided a detailed picture of the Philippine manufacturing sector’s performance since 2013.

The Philippines manufacturing industry exhibited a slowdown in growth in the recent quarters of this year.

However, when looking at the bigger picture, the Philippine manufacturing industry has been growing at a respectable rate, with manufacturing share-to-GDP remaining almost unchanged for the past few years.

Despite the slowdown, the country is enjoying fast growth due to domestic demand.

The Secretary highlighted one bright spot, and that is the continued growth of investments. There are notable significant increases in approved manufacturing investments, which were expected to do the following:

  1. Expand production capacities
  2. Address supply chains gaps
  3. Improve Global Value Chain Participation

Data shows that IPA-approved investments in 2016-2018 were at PHP 730 billion (US$ 14.4 billion), which is 57.3% higher than during the period of 2013-2015.

Moreover, growth in Board of Investments – approved manufacturing investments increased 8-fold: from 82% in 2016, it grew to 95% in 2017. By 2018, it zoomed to 327%.

Plans to Boost the Manufacturing Sector

Plans were laid down in order to achieve the revitalisation of the Philippine manufacturing towards a sustainable and inclusive industrial development.

The plans are to address growth constraints and leverage government support. These plans include:

  1. HR development to upskill workers and increase productivity
  2. Small value chain interventions to address raw materials shortage
  3. Incentivising energy technologies to help bring down power cost
  4. Logistics interventions to cut down red tape and standardise shipping cost
  5. Countering unfair trade practices including smuggling and substandard and counterfeit goods through mandatory product certification.

A peek at the Industry 4.0 readiness initiatives that the Department is planning to do was provided.

These initiatives will prepare firms, industries, and workers for the future. These include:

  1. The SME academy, which will be a training facility for IR 4.0 technologies to upskill and reskill the workforce, making them Industry 4.0-ready
  2. Positioning the Philippines as an AI Center of Excellence
  3. Industry 4.0 roadmaps for specific sectors
  4. An Industry 4.0 pilot factory to serve as a demonstration facility

There is a need to increase domestic capacity to support the growing demand of the economy.

The country needs to be prepared. The manufacturing sector should be revitalised in order to create more jobs and better income for the Filipinos.


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