A study of UPS, a global supply chain management solutions provider, shows that the trade between the Philippines and 11 other Asian markets could triple by 2030. The UPS study found the trade may go from $113 billion in 2020 to $393 billion in 2030.
“The Philippines has an opportunity to build on rapid growth in the previous decade, particularly in the manufacturing sector,” UPS said in a statement. “There are also significant opportunities for Filipino businesses in areas such as digitalization, building supply chain resilience and multilateral cooperation in international trade.”
The trade in 12 key markets ((Australia, China, Hong Kong, Indonesia, Japan, Malaysia, Philippines, Singapore, South Korea, Taiwan, Thailand, and Vietnam) accounts for 88% of intra-Asia trade today and these markets are poised to consolidate this position further.
Digitalization could unlock P5 trillion of annual economic impact in PH
Lack of public-private partnership holds back digital economy
The UPS study, which looked into trade growth drivers, potential headwinds, and multistakeholder action that can unlock the 2030 opportunity, found that trade within these markets could go from $6.4 trillion in 2020 to $13.5 trillion in 2030.
UPS found that the manufacturing segment is set to drive the Philippines’ intra-Asia trade growth. Four product segments — retail, industrial manufacturing and automotive (IM&A), high-tech, and healthcare — accounted for 75% of the Philippines’ intra-Asia trade in 2020 and are expected to fuel the growth.
“The IM&A segment stands to be the largest by value in 2030, more than trebling from 2020 levels as the country aims to serve as a global and regional hub for the automotive and electronics sectors,” UPS said.
The study also found that trade in the high-tech segment, which constituted 41% of the country’s intra-Asia trade in 2020, could more than double in value, riding the wave of digitalization which will create significant demand in this segment across Asia.
“Philippine-based businesses can plan for both headwinds and opportunities by diversifying supply chains into resilient trade routes and targeting high-value and high-growth trade routes, such as IM&A, healthcare, and retail trade with economies like Japan, as well in the high-tech segment with Hong Kong and Vietnam,” UPS said.