ABAC PH Share benefits of growth, Embrace digital economy

15 February 2018 – APEC Business Advisory Council (ABAC) Philippines members call on the local business community to share the benefits of growth and embrace the digital economy. These echoed the key themes of the first ABAC meeting for 2018
held in Auckland, New Zealand last February 1-4.

Tomas Alcantara, chair of ABAC Philippines, noted how APEC plays a critical role towards achieving the shared goal of inclusivity which will directly impact the domestic economy. “APEC represents an important region because it accounts for 64% of the Philippines’ foreign direct investments, 84% of its exports, and 63% of the Overseas Filipino population.”

Prospects for Asia-Pacific indicate that the region remains abound with opportunities. According to IMF experts, Asia-Pacific GDP would expand by 5.4% this year, far outstripping the rate of advanced economies at 2%. Forecast for the Philippines is even brighter with the agency predicting a 6.7% growth for 2018. The recent conclusion of the Trans-Pacific Partnership by 11 APEC economies, seen as one of the key pathways to an integrated Asia-Pacific economy, is welcomed as a positive step to regional inclusivity.

“Therefore, the Philippines should continue to engage the APEC community with the following strategies: (1) push for greater connectivity, (2) promote further liberalization of trade, (3) adapt to industrialization, and (4) achieve a people-centered development,” explained Mr. Alcantara. He stated that MSME development, the services agenda, and infrastructure finance are among the policy areas where the Philippines is most active.

ABAC PH member Joanne de Asis emphasized in Auckland how infrastructure provides the backbone of an inclusive economy, and that adequate financing is the lifeblood of infrastructure development in the region. “Infrastructure projects are the concrete and tangible outcomes of APEC’s and ABAC’s role in promoting prosperity in the region,” Ms. De Asis said. “Infrastructure finance, particularly an opportunity opening up in a pool of Islamic infrastructure financing, represents an alternative, new channel for funding projects under the government’s Build, Build, Build program. We look forward to playing an active role in this new area of work within ABAC,” she added.

Another big focus of ABAC this year is digital economy. In line with this, the private sector body of APEC has created a new working group that would address digital and innovation issues.

For ABAC Philippines’ Guillermo Luz, digital innovation as a new policy topic within ABAC is particularly relevant for the Philippines, which has a strong service-oriented economy. “We will look at the opportunities and adjustments to the economy that were brought about by technologies such as artificial intelligence, robotics and machine learning, among others. It is estimated that as much as 80% of existing jobs today may be changed significantly or outright eliminated in the next 40-50 years and replaced by even larger number of new jobs. The implications on today’s educational
system and curriculum will be massive,” Mr. Luz said.

ABAC 2018 chair David Toua of Papua New Guinea (PNG) explained what this focus on digital innovation means for Asia-Pacific. “[T]he digital economy provides a springboard for small business, women and other disadvantaged groups to take part in trade and connect around the region.” PNG is the chair for 2018 of APEC and ABAC meetings and will host the APEC Summit later this year.

He noted, however, that the full potential of a “Digital Asia-Pacific” could not be realized without investing to counter the digital divide that risks leaving the most vulnerable groups behind. “In all economies, we also need to nurture a future-ready workforce. That means putting in place the right settings for digital infrastructure, skills and education, and region-wide digital business-friendly regulation,” Mr. Toua added.

Explaining the thrust of PNG’s chairmanship for 2018, Mr. Toua said, “Growth is clearly an essential but not a sufficient condition for secure and prosperous communities.” He further stated, “We need to look closely at our economies’ policies to ensure that people can actually take advantage of the opportunities that growth brings. Harnessing inclusive opportunities is a key mantra for this year.”

With this year’s theme, “Digitization and Innovation – Advancing Social Harmony,” other specific priorities discussed in the ABAC meeting include improving connectivity; structural reform especially in the services sector; reducing trade and investment barriers; creating opportunities for MSMEs; strengthening financial systems; and grappling with issues around sustainable growth such as food and energy security.

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