This report uses the global value chain (GVC) framework to examine the role of the Philippines in the global chemical industry and identify opportunities for the country to upgrade. The Philippine chemicals sector is growing rapidly alongside economic expansion and a revival in manufacturing. By 2013, the chemicals sector as a whole accounted for 6.7% of GDP. Chemicals exports reached US$2.2 billion in 2014, approximately 3.5% of the country’s export basket. The sector’s expansion has outpaced both global and regional trade; with a compound annual growth rate of 13% since 2007, three times as fast as global exports, and twice as fast as Asian regional exports. Participation in the export market is based primarily on commodity products in the oleochemicals and petrochemicals sub-sectors. Within these segments, exports are driven by a small number of products, with the top 10 accounting for approximately three- quarters of all exports. While the country is a small player in the global chemicals trade, accounting for just 0.2% of exports in 2014, it has generally been successful in carving out a presence in these niche products, and is one of the global leaders in most of its top product categories.
The introduction outlines the analytical framework of the study, examines the Philippines recent economic growth and revitalization of the manufacturing sector, and provides an introduction to the Philippines investment, trade and education policies.
Key findings for the Philippines in Manufacturing Global Value Chains project were presented at a public forum at the Makati Diamond Residential Suites in Manila on June 2, 2016. The presentation highlighted the position of the Philippines in each of the five industries (aerospace, automotive, electronics & electrical, chemicals and paper) and focused on potential upgrading trajectories for each. Photos from the event can be accessed at the following link.
The GVC framework can shed light on issues that are literally a matter of life and death. Case in point is a recent study led by the Duke Global Health Institute (DGHI) and GVC Center that identified value chain improvement opportunities for a life-saving commodity: chlorhexidine (CHX) for umbilical cord care. A Duke team of students, staff and faculty dedicated two semesters of research to investigate this topic. This included site visits to Dhaka, Bangladesh in March and May 2015, just before the CHX launch in the country.
Infections cause 13% of the 3 million newborn deaths each year globally. Clinical trials conducted in Bangladesh and other countries have shown that an estimated 23% of neonatal deaths can be averted using 7.1% chlorhexidine digluconate. The UN Commission on Lifesaving Commodities for Women and Children has advocated for country by country introductions of CHX where newborn deaths are high due to infection. CHX is inexpensive (less than $1 per dose) and is manufactured by local as well as multinational generic manufacturers in gel and liquid formulations.
GVC mapping depicts the labor, policies, capabilities, inputs, technologies, standards, regulations and markets relevant to a particular product, commodity or service. Using value chain analysis, Jeffrey Moe (DGHI) and Danny Hamrick authored the study. The report described the full range of CHX activities in the country, including development, production, distribution and adoption and use by mothers and their caregivers.
Duke students contributed to the report by reviewing clinical studies and launches of CHX in other countries and interviewing key actors involved in CHX’s introduction in Bangladesh. Analysis of the map revealed seven “leverage points” — an opportunity to consider “upgrading” to capture efficiencies, reduce costs and increase access and quality. The seven leverage points highlighted in the report are:
1. Research and development
3. Regional supply and market expansion
4. Safe delivery kits
6. Global coordination
7. Monitoring and performance metrics
Moe and Hamrick suggested that the “report provides another application of value chain analysis to studies of global health by highlighting the various roles actors play, the governance structures that guide activities and the crucial leverage points.”
The student work and their visit to Bangladesh was funded by the Bass Connections program at Duke University. USAID’s Health Education Solutions Network also provided support.
Powder coatings eliminate VOCs released during industrial coating processes and offer additional environmental and economic benefits over petroleum-based coatings. The report traces the history of powder coatings in the United States and Europe, identifies the powder coating value chain structure, the ability of key players to affect the industry, and some challenges of the Chinese powder coating market. This research was sponsored by the Corporate Partnerships Program of the Environmental Defense Fund (EDF).
Other articles published related to the powder coating project: