It appears that Filipinos are visiting Vietnam and Cambodia, and find them interesting and promising. The writer had done business in Vietnam when it opened its doors and was keen to make a nostalgic trip.
These countries, probably desperate to jumpstart development, have indeed opened their doors. The writer remembers flying Vietnam’s local airline almost 20 years ago and hearing the voice of the French pilot. This time, he hears an Australia pilot and also a Korean pilot. In Siem Reap the writer checks out the label of a popular beer – and it comes from Singapore. The tour guide explains that he can buy a local SIM card and has a choice of carrier – that aside from local carriers, there are foreign ones too: Vietnamese, Malaysian, Thai, etc.
It seems Filipinos like the rest of the world expect Vietnam to develop faster than the Philippines especially given that they have more than twice our gross investment – and more than twice the value of foreign equity investment. And since Cambodia is drawing tourists in abundance, will we see Cambodia developing at a faster clip too?
We don’t need foreign pilots because we’ve been training and developing pilots for generations. But if that is our reaction, we’re missing the phenomenon going on in Indochina. For instance, where is San Miguel and PLDT when our neighbors have all planted stakes in this fast-developing part of the region? (In fairness the writer saw a San Miguel neon sign in Ho Chi Minh. And with Kirin’s equity in San Miguel, it appears the international unit is geared to be more focused. But currently, in Vietnam, their product-distribution coverage and marketing efforts aren’t competitive!) That’s the stark face of competition – and it’s real! Do we then intellectualize our response and conclude that what we need is more OFWs? Is national pride inhibiting us from heeding the World Bank and ADB, i.e., that “we must be fully engaging with the global economy”? Or does our way of life have very little propensity for change?
San Miguel and PLDT are two of our premier enterprises – and should be aggressively expanding their markets beyond the Philippines? PLDT is NYSE-listed; it is not surprising if foreign investors value their competitiveness in the Philippines; and the continued OFW remittances. But stock market investors are short-term driven, i.e., we can’t take it as an endorsement of our economic fundamentals. The test of (foreign) investor confidence is in the size of their equity investment and we pale in comparison to Vietnam – another stark reality!
Is it surprising then that we are the region’s economic laggards? Indochina is less developed than the Philippines. Their infrastructure is underdeveloped. Doing business in these countries requires lower overhead versus doing business in the developed world, for example. Indochina is still low-cost and thus affordable to hire resources: (a) to do market research and understand the consumer, (b) figure out the trade structure and thus pinpoint where to focus distribution efforts, i.e., via the 80-20 rule, (c) put up a manufacturing facility, and (d) to do marketing. Indochina is not a small market – the population is 108 million, a bit more than the Philippines. And the latest poverty reports in Vietnam and Laos are better than ours. (The object of the writer’s efforts in Vietnam years ago has gone full circle – i.e., he had a big smile watching the product’s TV commercial in his hotel room!)
Of course we must play an honest-to-goodness competitive game, i.e., as foreigners we can’t play the power or influence-peddling game that our major enterprises are adept in playing in the Philippines. In Indochina the local companies can play the game, but foreign companies can’t. It takes one to be truly competitive to succeed beyond its borders – and that means developing compelling products with healthy margins. Net, our industry needs to upgrade its skill-set in product development in order to be competitive!
Should we start learning the ropes and stake our claims in less formidable markets like Vietnam and Cambodia? And aspire to be a global, competitive player? It’s never easy to do business beyond one’s borders. But Pacquiao would not be world-class if he stayed home!
These countries, probably desperate to jumpstart development, have indeed opened their doors. The writer remembers flying Vietnam’s local airline almost 20 years ago and hearing the voice of the French pilot. This time, he hears an Australia pilot and also a Korean pilot. In Siem Reap the writer checks out the label of a popular beer – and it comes from Singapore. The tour guide explains that he can buy a local SIM card and has a choice of carrier – that aside from local carriers, there are foreign ones too: Vietnamese, Malaysian, Thai, etc.
It seems Filipinos like the rest of the world expect Vietnam to develop faster than the Philippines especially given that they have more than twice our gross investment – and more than twice the value of foreign equity investment. And since Cambodia is drawing tourists in abundance, will we see Cambodia developing at a faster clip too?
We don’t need foreign pilots because we’ve been training and developing pilots for generations. But if that is our reaction, we’re missing the phenomenon going on in Indochina. For instance, where is San Miguel and PLDT when our neighbors have all planted stakes in this fast-developing part of the region? (In fairness the writer saw a San Miguel neon sign in Ho Chi Minh. And with Kirin’s equity in San Miguel, it appears the international unit is geared to be more focused. But currently, in Vietnam, their product-distribution coverage and marketing efforts aren’t competitive!) That’s the stark face of competition – and it’s real! Do we then intellectualize our response and conclude that what we need is more OFWs? Is national pride inhibiting us from heeding the World Bank and ADB, i.e., that “we must be fully engaging with the global economy”? Or does our way of life have very little propensity for change?
San Miguel and PLDT are two of our premier enterprises – and should be aggressively expanding their markets beyond the Philippines? PLDT is NYSE-listed; it is not surprising if foreign investors value their competitiveness in the Philippines; and the continued OFW remittances. But stock market investors are short-term driven, i.e., we can’t take it as an endorsement of our economic fundamentals. The test of (foreign) investor confidence is in the size of their equity investment and we pale in comparison to Vietnam – another stark reality!
Is it surprising then that we are the region’s economic laggards? Indochina is less developed than the Philippines. Their infrastructure is underdeveloped. Doing business in these countries requires lower overhead versus doing business in the developed world, for example. Indochina is still low-cost and thus affordable to hire resources: (a) to do market research and understand the consumer, (b) figure out the trade structure and thus pinpoint where to focus distribution efforts, i.e., via the 80-20 rule, (c) put up a manufacturing facility, and (d) to do marketing. Indochina is not a small market – the population is 108 million, a bit more than the Philippines. And the latest poverty reports in Vietnam and Laos are better than ours. (The object of the writer’s efforts in Vietnam years ago has gone full circle – i.e., he had a big smile watching the product’s TV commercial in his hotel room!)
Of course we must play an honest-to-goodness competitive game, i.e., as foreigners we can’t play the power or influence-peddling game that our major enterprises are adept in playing in the Philippines. In Indochina the local companies can play the game, but foreign companies can’t. It takes one to be truly competitive to succeed beyond its borders – and that means developing compelling products with healthy margins. Net, our industry needs to upgrade its skill-set in product development in order to be competitive!
Should we start learning the ropes and stake our claims in less formidable markets like Vietnam and Cambodia? And aspire to be a global, competitive player? It’s never easy to do business beyond one’s borders. But Pacquiao would not be world-class if he stayed home!
Great takes on the Philippine economy. Please drop by my news and economic discussions site when you can.
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