Ten promising sectors for U.S. exporters are summarized below. This list is not exclusive, so if your products or services are not listed here, please contact us using the form at the bottom of this page for an assessment of the market. You may also use this form to request information on typical market entry strategies, opening an office in Manila, and an unscreened list of potential local representatives for your company.

Introduction

Almost any U.S. product or service can find an interested buyer in the Philippines. The country is solidly pro-American, and the government and people are strong allies of the United States. The United States exports almost $8 billion annually to the Philippines, making this our 19th largest export market and our biggest customer in SE Asia. Thanks to our close relationship over the past 100 years, Filipinos are very knowledgeable about U.S. products and services and have a great affinity for them. Moreover, the Philippines is the world’s third largest English speaking nation, so U.S. firms seldom encounter language problems when doing business with Philippine companies. The U.S. presence is strong and growing.

(1) Information, Communication and Technology (ICT)

The Philippine Information Technology market is primarily being driven by extraordinary growth in outsourced ICT services. The Philippines’ strongest market niche is in IT-enabled services or call centers. More and more companies are making infrastructure investments to support the demand for call center facilities. In fact, the Philippine call center/outsourcing industry is projected to be among the largest sectors in the country for the next five years.

(2) Automotive Aftermarket

The Philippine automotive aftermarket industry represents a significant portion of economic activity in the Philippines with extensive upstream and downstream linkages to diverse industries. The industry contributes in a significant way to the country’s employment, investments and exports. Moreover, strong links exist between motor vehicle assemblers, motor vehicle parts and components manufacturers and importers.

(3) Electrical Power Systems

2006 has been a pivotal year for the power sector, five years after the enactment of the Electric Power Industry Reform Act (EPIRA). Further delays in the full implementation of EPIRA may lead to serious power shortages and escalating energy costs. EPIRA aims to restructure the generation, transmission, distribution and retail sale of electric power in the Philippines. Demand for power will continue to grow strongly, driven by the expected increase in economic and industrial activity and the country’s growing population. The industry estimates demand for electric power will grow 9% annually, at least until the end of the decade.

(4) Telecommunications Equipment

The Cellular Mobile Telephone System (CMTS) is the Philippines digital device of choice. Today, 26% of Filipinos (over 22 million) carry cell phones, far outstripping the number of landlines and wired phones combined. In 2004, the total number of CMTS subscribers grew 34% to over 30.2 million. The Philippines continues to be the world leader in the Short Messaging Service (SMS) market. Carriers process more than 200 million text messages per day.

(5) Safety and Security Equipment

The Philippine market has become more price-conscious in recent years, but demand for safety and security products will continue to surge, thanks to increasing awareness and appreciation for securing commercial and industrial establishments, residential communities, sensitive structures and protecting life and property. The government’s current campaign against terrorism and criminality has all the more stressed the importance of such security provisions. In many cases, the local market puts price consideration as an equally important element (versus product quality) in the decision to buy most safety and security products.

(6) Pharmaceuticals

Pharmaceutical companies attributed the increase to continued demand for OTC and prescription drugs for the maintenance or treatment of various diseases. Overall, the pharmaceutical market is expected to grow by 5.5% per year. The country falls under the Third World country category and will thus continue to battle poverty-related diseases in the foreseeable future. Although statistical data on local production are not available, industry players report an increase in local manufacturing activity.

(7) Building Products

Construction spending by the public and private sectors is increasing. Public construction is growing due to the implementation of critical infrastructure projects as well as increased pump priming activities in the countryside. Financial reforms have influenced demand in private construction, especially in housing. The Philippines’ housing need for the period 2005-2010 is estimated at 3.75 million units.

(8) Aviation

The Philippine aerospace industry offers bright prospects for U.S. companies. Over the past two years, Philippines Airlines (PAL) and Cebu Pacific- the country’s two largest carriers- have pursued their re-fleeting programs and expanded domestic and regional routes, maintaining passenger load factors of more than 70%. To keep up with international safety standards and the increased passenger traffic, the Philippine Government, has several infrastructure projects open for international competitive bidding. These projects will result in the purchase of air traffic control equipment, international landing systems, fire rescue vehicles and maintenance equipment, airport safety and security equipment and CNS/ATM systems.

(9) Medical Equipment

Continuous requirements for medical services, new technology, and equipment replacement should spur market growth. The U.S. market share is 30 percent. Japan and Singapore follow with 13 percent each. Importers of medical equipment advise that import data on Singapore reflect transshipments from the U.S., Europe and other Asian countries, including Japan. The market shares reflect Philippine preference for U.S. products. Third country suppliers, however, are giving U.S. products increasing competition.

(10) Water Resource Equipment and Services

The Philippine market for water resource equipment/services is expected to grow by about 5 percent in the next two years. On-going and upcoming projects that address the increasing water demand and pressing water-related problems of the Philippine include limited access to potable water through water supply and distribution operations (80 percent of the Philippines’ 80 million people are served by potable water. Roughly 30 million people throughout the country do not have access to potable water through water supply and distribution operations); lack of accurate water usage monitoring; large amount of “unaccounted-for-water” due to leaks in distribution pipes, inefficient metering and poor administration. The United States is a major source of water resource equipment and services of the Philippines.

Additional Industry Sectors, Market Entry Strategies, Other Information

Remember, you can contact us for an assessment of the Philippine market for other products or services not listed here. This free assistance is available only to exporters of goods and services that have at least 51 percent U.S. content.