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Economic Lessons From 2011

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The Philippines slipped into another economic downturn in 2011. Adverse global trends are a factor with the world economy three years into what is going to be a protracted global depression. More significant however is the absence of bold domestic economic policy initiatives that tackle the country’s internal weaknesses and, in so doing, also reduce its vulnerability to external shocks.

The past year gives at least three insights to inform economic policy-making not just in 2012 but in the coming period of great challenges for Philippine growth and real development.


PH Is Enjoying A Robust Economy Says Top Envoy

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CHICAGO (JGL) – The Philippines is enjoying a robust economy buoyed by an improving peace and order in the country, according to Philippine Ambassador to the United States Jose L. Cuisia, Jr.

In a talk before his fellow alumni at the 20th anniversary celebration of the La Salle Philippines Alumni Association (LSPAA) in Crystal City, Virginia over the weekend, Ambassador Cuisia said,  “The economy is up, with economic growth registered at 6.4 percent for the second quarter of 2014, that’s up from 5.6 percent for the first quarter.”

He cited the observation of the World Economic Forum that based on its Global Competitive Report for 2014-15, the Philippines has jumped the “rankings of the World Economic Forum’s (WEF) Global Competitive Report for 2014-2015 by seven places to be ranked 52nd out of 144 countries.  This is no small feat, with the WEF noting that the Philippines has achieved the largest jump in rankings since 2010.”


APEC Moves Forward On Trade Facilitation

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BEIJING, China – APEC economies are pressing ahead with efforts to accelerate trade and economic growth through the elimination of costly delays to the flow of goods as they cross international borders, undeterred by the unexpected challenge to implementation of the Agreement on Trade Facilitation now facing members of the World Trade Organization.

Senior customs and trade officials from the APEC region are currently meeting in Beijing for the first time since WTO members failed to enact a protocol on 31 July required to proceed with adoption of the agreement that would ease trade bottlenecks through greater simplification of customs rules and processes.

“Although the implementation of the Trade Facilitation Agreement is experiencing some difficulties, the facilitation of trade and reduction of trade costs remain high on our collective agenda,” said Sun Yibiao, Vice Minister of China’s General Customs Administration, in remarks before officials who are gathered here to chart the next step, culminating with a meeting of APEC Senior Officials from the region’s 21 member economies on Wednesday and Thursday.


Recycling Old Patents Helps Rural Villagers Power Sustainable Industries

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SINGAPORE - Intellectual property is taking on a whole new meaning for villagers in remote areas of the Philippines and Papua New Guinea. Through an APEC project, intellectual property (IP) experts from Korea are helping rural communities leverage expired patents, transforming the economic prospects of local farmers.

Working closely with local villagers in Central Luzon, the Philippines, IP experts helped identify and adopt suitable technologies to improve the processing of essential oils from the region’s ylang-ylang trees. The ylang-ylang trees offer a potential income source for the local community because their flowers can be processed into an essential oil—the core ingredient of most perfumes and aromatherapy products.

The town of Anao and its surrounding villages in Central Luzon have approximately 10,000 ylang-ylang trees, each bearing up to 60 kilos of flowers per year. With an extraction boiler in Anao town, villagers processed harvested flowers, and produced and sold the oil. Anao town marketed its own essential oil as ‘Aroma Anao’, under a registered trademark.

However, as villagers expanded their harvest, they hit a major bottleneck. The town and its surrounding area only contained one oil extraction facility, a large boiler in Anao town. To their dismay, villagers quickly discovered that the freshness of the ylang-ylang flowers directly impacted the quality of the oil produced. Consequently, only eight of Anao’s eighteen surrounding villages were able to produce top-quality essential oils.

Improving Livelihoods in Anao

In 2013, an APEC appropriate technology project led by the Korean Intellectual Property Office was able to dramatically change the fortunes of Anao and its surrounding villages.

The Korean IP experts visited Anao in mid-June 2013 to examine the existing essential oils extraction facility. Besides realizing that a mobile extraction capability would benefit the ten most remote villages, the staff members also noted that the existing extraction boiler delivered a relatively low yield per kilo of harvest.

“Back in Seoul, we searched our patent databases for essential oil-extraction technologies that could improve yield and quality for the residents of Anao, and all its outlying villages,” said Taemin Eom, Director of the Multilateral Affairs Division at the Korean Intellectual Property Office in Daejeon, Korea.

“From an expired patent, we discovered an idea for modifying the boiler tray to maximize flower exposure to steam. We incorporated the technology into a design for a small, mobile oil-extraction boiler that could move between villages,” added Eom.

The Philippines Center for Postharvest Development and Mechanization invested USD 10,000 to help meet development costs, and the Korean International Cooperation Agency provided additional funds. Korean experts returned to Anao twice in 2013 to test the mobile extractor, which proved instantly popular among villagers and town residents.

“The new boiler means that people from remote villages around Anao can extract high-quality oil, and generate cash incomes for their families,” explained Agnes B. Ramirez, Department of Trade and Industry, the Philippines. “The new technology costs less to run, and the additional capacity means that Anao town can increase its overall production volume.”

Ramirez observed that the APEC appropriate technologies project is inherently environment-friendly, since it encourages the continued planting of ylang-ylang trees.

“The project will give local people a powerful sense of ownership over their essential oils industry, since the portable extractor will be owned and operated by local people,” she said. “Increased extraction will provide remote villages with employment and income opportunities, and will enable Anao to expand its reputation as ‘Ylang-ylang Town’.”?

Finding and Adapting Old IP

The appropriate technology project was endorsed by the APEC Intellectual Property Experts Group (IPEG) in 2013 and self-funded by Korea. The project goal has been to create affordable technologies that could improve economic prospects and quality of life in developing communities. What made the appropriate technology project unique, however, was the Korean Intellectual Property Office’s offer to use its in-house expertise in IP research to find and adapt existing technology ideas to local conditions.

“Massive amounts of valuable technology information is accumulated in IP databases, but is never applied or used,” explained Eom. “Our office has the expertise to conduct what is called a ‘prior art’ search, which means examining IP information to find examples of pre-existing technologies, including inventions with expired patents.”

“Expired patents are often an ideal resource for developing economies, simply because the logistics, skills and components required to keep cutting-edge, patented technologies working are unavailable.”

With a practical, IP-based approach to development challenges, the Korean Intellectual Property Office’s strategy struck a chord with APEC members and objectives. “The goal of the appropriate technology project was to narrow the development gap between APEC member economies, and boost global prosperity,” added Eom.

Old Bicycles, New Pumps in Papua New Guinea

Farther south, the APEC appropriate technology project is also helping to improve irrigation at Pinu, a remote village in Papua New Guinea, located 90 km west of the capital Port Moresby. In Pinu, the challenge for the project was to help a rural, low-income community with farmland irrigation.

“The basic problem at Pinu was to find a way to pump water from existing water sources during the Papuan dry season,” said Eom. “It was not necessary to find an advanced technical solution because there were no resources or supply chains to support it. Also, advanced technical solutions are not cost-effective due to high costs in Papua New Guinea.”

Korean Intellectual Property Office staff members spent over one week in Pinu in May 2013, surveying local materials and capabilities, and brainstorming ideas in collaboration with the National Agricultural Research Institute in the regional center, Laloki.

“When we returned to Korea, we conducted another prior art search to identify human-powered pumping technologies that could be adapted to conditions at Pinu,” explained Eom. “We discovered a set of concepts for connecting the rear wheel of a stationary bicycle to a water pump using rope. The technology was extremely simple, but it would enable farmers to raise large volumes of water to dried-up waterways, and irrigate their fields during the dry season.”

Korean experts returned to Pinu in November 2013 with a prototype, conducted experiments, solicited views from local farmers and then refined the concept. The technology was then distributed to five surrounding villages.

“When adopted by the entire village community, the impact of the bicycle-pump technology is that the farming families will be able to grow food during the drier months of June to October, which is usually the period of hunger,” said Clifton D. Gwabu, Research & Development Coordinator, National Agricultural Research Institute, Papua New Guinea. “They will also be able to grow excess food to sell at markets, and use the money to pay for medical costs and schooling for their children.”

Gwabu reported that the practical benefits are already being experienced by one family farm in Hisiu village, where it has enabled the owners to start producing cabbage at a semi-commercial level. “The same family is also using pump-harvested water to wash clothes,” he added. “Previously, during the dry season, they had only one option: to walk four hours back and forth to do laundry in the nearest big river.”

Sharing IP Know-how across APEC

With eight projects and technologies implemented by mid-2014 in APEC and other economies, the Korean Intellectual Property Office has started to build a database of appropriate technologies.

“Searching for IP information is difficult and requires a particular set of skills, so we decided to create a public database of appropriate technologies, accessible through the Korean Intellectual Property Office website for all APEC members to use,” explained Eom. “By mid-2014, we had amassed 1,000 appropriate technology-related patents, sorted into nine categories, such as ‘water’, ‘energy’ and ‘health’, with summaries that describe their legal status.”

As part of the project, APEC hosted and funded an international conference in Seoul, Korea, in July 2014, to showcase the project and explain the role IP can play in sustainable development.

“We believe other communities across APEC can benefit by using our IP-utilized appropriate technologies methodology,” said Eom. “Prior art searches may be an unfamiliar concept to people who have never considered IP as a resource for developing economies. However, it’s our responsibility to raise awareness of how IP utilization can help rural communities overcome everyday problems.”

US Credit Troubles: Problems For The Philippine Economy

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The recent United States (US) credit rating downgrade is just the latest sign that the global crisis which erupted in 2008 has not been resolved and will continue for years to come. The Philippine government and its economic managers are unfortunately oblivious to this reality in their medium-term planning and budgeting for 2012 which undermines the country’s prospects for development.


APEC Advancing Blueprint For Improved Regional Connectivity

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QINGDAO, China  - APEC member economies are drawing up a new regional connectivity blueprint to bring diverse markets, businesses and people closer together to facilitate trade and investment for delivering greater long-term growth across the Asia-Pacific.

Coordination between APEC Senior Officials, technical experts and the private sector to flush out the blueprint’s details was at the top of the agenda during working-level discussions over the past week in Qingdao. APEC Trade Ministers are deciding the next step as part of their two-day meeting which opened here on Saturday.


Cebu Lands 8th In Outsourcing Destination In the World

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CEBU  - Tholons Inc., a leading U.S.-based services globalization and investment advisory firm, has rated Cebu among the world’s top outsourcing destinations, beating other high-profile locations in Europe.

The 2014 Tholons Top 100 Outsourcing Destinations ranks Cebu as the world’s eight-best, after Bangalore, Metro Manila, Mumbai, Delhi, Chennai, Hyderabad and Pune.

“Cebu’s reputation as a prime world-class outsourcing hub will get an even bigger boost once the Mactan Newtown is fully developed,” Rep. Gerald Anthony V. Gullas, Jr. said. Gullas is Assistant Majority Leader of the House of Representatives representing the First District of Cebu.


APEC Holds Discussions To Prepare SMEs For Disasters

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NEW YORK --- In the wake of Typhoon Haiyan, small and medium-sized businesses in the Philippines from farms to fisheries were impacted by the devastation. Many coconut farms, a key export for the Philippines, were flattened. Amid the wreckage of flooded crops and broken boats, small business owners struggled to rebuild their livelihoods.

“Typhoon Haiyan hit many micro, small and medium-sized businesses (SMEs) hard, seriously affecting lives, livelihoods and communities,” said Ray Chambers, the United Nations Special Envoy for Financing the Health Millennium Development Goals and for Malaria. “In the Philippines, SMEs provide a living for 65 per cent of the labor force, and as such, they play an essential role in a region’s recovery.”


The Mighty Pharmaceutical Industry

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MANILA (July 19) — Sen. Mar Roxas is raising hell about the alleged collusion between the Arroyo government and the pharmaceutical industry to delay if not derail the implementation of Republic Act 9502, or the “Universally Accessible Cheaper and Quality Medicines Act of 2008,” which was signed on June 6, 2008. Among the provisions the multinational pharmaceutical companies are reportedly blocking is the setting of the maximum retail price for 22 essential medicines. To sweeten the deal between the Arroyo government and pharmaceutical firms, Pfizer allegedly offered five million “sulit” discount cards to President Arroyo for distribution to indigent patients around the country. (Remember the distribution of PhilHealth cards in 2004?)



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