Philippines is the next big thing in global supply chain

Philippines, Thailand primed as next supply chain ‘rising stars’

BusinessWorld
June 25, 2026 

Thailand, the Philippines and Argentina are among a group of promising yet underutilized economies primed for an increasing role in supply chains, according to a new analysis of global trade trends.

These and other countries in Southeast Asia and Latin America stand to benefit from diversification as companies look beyond cost and efficiency to build resilience, Verisk Maplecroft, a UK-based risk intelligence firm, said in a report released Thursday.

A third of the world’s busiest ports and airports are vulnerable to disruption from conflicts, environmental risk and domestic security threats, the firm warned. At a time when trade resilience has deteriorated in more than 150 countries — accounting for 90% of global trade — there’s opportunity for “rising stars,” the report argued.

The shuttering of the Strait of Hormuz during the US-Israel conflict with Iran created “near-term headwinds” for both Thailand and the Philippines, Verisk Maplecroft said. Still, its data indicate that those “willing to take a longer-term view will find these markets worth their attention.”

Market openness, regulatory strengths and labor rights in each country are the three main factors the firm analyzes.

The supply chain potential in the Philippines comes despite a bout of political turmoil in the past year, including a sprawling scandal over corruption in contracts for flood mitigation projects that’s seen politicians issued with arrest warrants.

With a young, English-speaking labor force, the Philippines offers significant potential for industrial services and outsourcing, she said. “If you are confident in your company’s supply chain management systems to monitor and manage corruption risk, that doesn’t have to be a complete barrier,” Schwartz said.

THAILAND, ARGENTINA

Risks for Thailand, meantime, have decreased when compared with regional peers during the past five years, the firm said in its report. Thailand’s electronics sector is benefiting from AI investment, and the country is “well positioned to host higher-value supply chain links,” Verisk Maplecroft said. That’s even with an aging workforce and higher-cost labor compared with others in the region, it said.

“The ingredients are really good for a lot of the industries that are seeking supply chain diversification opportunities,” Schwartz said.

For Argentina, both the European Union-Mercosur trade accord and an agreement with US on reciprocal trade and investment could drive a shift on critical minerals, energy and industrial exports.

That graft scandal dented foreign investment in the Philippines last year and has been a factor in the government cutting its economic growth forecast for this year. The Senate, meantime, has been consumed by infighting related to a rift between President Ferdinand Marcos Jr. and his deputy, Sara Duterte, who faces an impeachment trial in July.

“Things are still happening behind the scenes, including efforts to attract investment and reduce regulatory burdens on businesses — though the results of these efforts have yet to fully emerge,” according to Laura Schwartz, senior Asia analyst at Verisk Maplecroft.

“Sometimes political chaos completely stops policymaking, and sometimes it happens alongside policymaking.”

Chile and Uruguay are also on the regional list, with the latter offering the region’s strongest risk-adjusted operating profile.

“Latin America still trails Southeast Asia as a scaled manufacturing platform, but Western efforts to reduce exposure to China are creating new supply-chain contenders,” according to the report.

The report also points to Vietnam, Malaysia, Mexico and Brazil as already benefiting from the reduction in bilateral trade between the US and China. Those four have their advantages as supply hubs, the report said, “but according to our data, risks to multinational supply chains in all of these jurisdictions are increasing.” — Bloomberg

OFWs: Boon or Bane on Philippine economy?

Highly educated Filipinos as OFWs: A double-edged sword for PH

Story by Cristina Eloisa Baclig
Inquirer.net
09 May 2024

MANILA, Philippines—In a world that’s constantly on the move, the Philippines has carved out a unique position as a powerhouse in the export of skilled labor. Every year, waves of Filipinos pack their bags to set out across the globe, driven by the pursuit of brighter futures and better opportunities.

This mass migration, while opening doors for many, wields a double-edged sword: it propels Filipino talent onto the world stage, filling crucial roles in international industries, yet it simultaneously strains the local workforce, especially in critical sectors such as health care and education.

These workers, known as Overseas Filipino Workers (OFWs), are not just employees abroad; they are the lifeline of their homeland. Their remittances are the financial bedrock for countless families and a vital cog in the machinery of the Philippine economy.

However, this exodus of talent also brings to light the concerning issue of ‘brain drain,’ leaving the nation in a perpetual struggle to replenish its pool of professionals.

This phenomenon is reshaping the Filipino identity on the global map, striking a balance between loss and gain, between the home left behind and the promise of the world beyond.

Highly educated workers leave PH

Despite its relatively small population of just over 100 million, the Philippines has made a significant impact on the world’s skilled workforce. With an impressive 1.89 million highly educated Filipinos residing in OECD countries, the country ranks third in the world for having the largest educated diaspora, falling behind only India with 3.12 million and China with 2.25 million.

The significance of the country’s contribution to the global pool of skilled workers becomes even more pronounced when considering the country’s much smaller population compared to India and China, both of which have populations exceeding a billion. India’s population stands at approximately 1.325 billion, while China’s is around 1.379 billion.

However, this success story is not without its challenges. The country faces a critical issue: a high percentage of its highly educated workforce is emigrating abroad.

In recent years, the number of Overseas Filipino Workers (OFWs) has continued to grow, with data from the Philippine Statistics Authority showing a steady increase from 1,825,000 in 2021 to 1,963,000 in 2022. These numbers represent a significant proportion of the country’s workforce, engaging in a diverse array of occupations across the globe.

Of the Filipinos returning from overseas, data from the International Organization for Migration (IOM) revealed that 49.6 percent have some college education or higher, reflecting the level of education many choose to take abroad.

This phenomenon is more pronounced in the Philippines compared to countries like India, where the emigration rate of educated individuals is minimal despite its vast population. This raises concerns about the sustainability of the country’s workforce development.

It is essential to note that while other countries like the United Kingdom (1.75 million), Germany (1.47 million), Poland (1.20 million), Mexico (1.14 million), and Russia (1.06 million) also supply skilled migrants, the situation in the Philippines is particularly striking.

The country’s departure of a significant portion of its skilled and educated workforce highlights its crucial role in the global marketplace. It also underscores the potential challenges to its workforce development and sustainability.

Where OFWs go

According to data from the Philippine Statistics Authority (PSA) for 2022, Asia remains the predominant destination for OFWs, accounting for 80.8 percent of the Filipino workforce abroad. This substantial proportion reflects the longstanding ties and geographic proximity that facilitate labor migration within the region.

The Middle East is another crucial employment hub, with Saudi Arabia hosting 23.0 percent of OFWs alone. The United Arab Emirates and Kuwait also significantly contribute, with 13.7 percent and 7.7 percent respectively.

These regions depend on the diverse skill set of OFWs, particularly in sectors such as health care, construction, and domestic services, where their hard work and adaptability are highly valued.

In addition to Asia and the Middle East, other parts of the world also draw Filipino talent. Europe accounts for 9.0 percent of OFWs, while North and South America collectively make up 6.3 percent, with countries like the United States and Canada becoming increasingly popular due to higher wages, better living conditions, and opportunities for family reunification.

These nations, known for their multicultural makeup, provide a supportive environment for Filipinos, helping to foster a sense of community and belonging far from home.

This significant presence of OFWs across various regions highlights their integral role in the global workforce. It sets the stage for a deeper exploration into the impact of their financial contributions, mainly through remittances, on both their host countries and the Philippines.

Rising remittances

In 2023, remittances from OFWs continued to play a pivotal role in the Philippine economy, highlighting the significant financial contributions of Filipinos working abroad.

According to data from the Bangko Sentral ng Pilipinas (BSP), remittances reached an all-time high, with cash remittances alone amounting to $33.491 billion for the year. This marked a growth of 2.9 percent over the previous year, underscoring the resilience of OFWs’ financial contributions despite global economic uncertainties.

December 2023 saw a notable increase in remittances, with a 3.8 percent rise to $3.28 billion compared to the same period in 2022, reflecting the seasonal trend of increased remittance flows during the holiday season.

This boost was largely attributed to the contributions from both land-based and sea-based workers, demonstrating the ongoing commitment of OFWs to support their families back home during significant times of the year.

The United States, Singapore, Saudi Arabia, and Japan were among the leading sources of these remittances, pointing to the diverse global footprint of the Filipino workforce. The steady flow of funds from these countries not only supports individual families but also plays a crucial role in stabilizing the Philippine peso and bolstering the country’s economic growth.

Projected trends suggest that remittances will continue to grow, with an expected increase of 3 percent in the forthcoming years. The data showed that OFWs continue to send financial support back home, ensuring a robust economic connection with their homeland.

This steady stream of funds not only aids individual family members but also plays a crucial role in maintaining the economic stability of the Philippines.

Addressing ‘brain drain’

As the Philippine government acknowledges the profound impact of brain drain on national development, President Ferdinand Marcos Jr. has proposed a new strategy aimed at retaining local talent.

The strategy involves enticing graduates, particularly from the health and information technology sectors, to serve in the Philippines before moving abroad.

“We have to come up with some kind of strategy wherein, let’s say, you provide scholarships, and then the scholarship agreement includes that you stay three years. After that, then they’re free to go,” Marcos said

This initiative is complemented by the acknowledgment that while Filipino graduates are free to seek opportunities abroad, the loss of trained professionals could be mitigated by such programs.

According to Marcos, these efforts need to be supported by more attractive local employment options that could compete with international offers.

In support of this strategy, the Private Sector Advisory Council’s Jobs Sector Group (PSAC-Jobs) has highlighted that the local market struggles to match the high salaries offered in countries like the United States, the United Kingdom, Australia, and Europe.

“I think what we can do is to continue to offer certificate programs and train their skills. I think we can do that. There’s no way for us to retain them,” said Teresita Sy-Coson of SM Investments Corp.

The PSAC has also urged a more coordinated approach among government agencies—including the Department of Health (DOH), the Commission on Higher Education (CHEd), and the Department of Migrant Workers (DMW)—to create more compelling opportunities for Filipino workers.

SEA as top growth market

Southeast Asia seen as a top growth market

Story by Alden M. Monzon
Inquirer.net
22 April 2024

MANILA, Philippines — Asia-Pacific business leaders expect that most growth in the region this year will be in Southeast Asia, which includes the Philippines, highlighting the potential for global growth for small- and medium-sized enterprises (SMEs) in this part of the globe.

This is according to a survey by the American multinational FedEx Corp., done in partnership with Forbes Insights, which involved a poll of 250 business leaders in the region, including founders and C-suite executives.

Respondents were asked to select the regions where they see the most growth potential in the next 12 months.

About two-thirds or 68 percent of respondents picked Southeast Asia, followed by Europe, which was chosen by 45 percent.

Meanwhile, North and South America was selected by 45 percent, while the grouping of India, the Middle East, Eurasia, and Africa was cited by 33 percent.

Maribeth Espinosa, managing director of FedEx Express Philippines, said in a statement the survey presents valuable insights and opportunities for businesses in the Philippines to better serve their customers and tap into new markets.

In the same survey, issues on government customs requirements, tariffs, and customs clearance were cited as the biggest barrier to cross-border business as cited by half of the respondents.

Marketing, as well as gaining visibility into global markets and finding customers, on the other hand, was cited by 45 percent.

The third challenge, as cited by 42 percent, is finding partners and suppliers in global markets. INQ