Philippines has big plans for infrastructure to link up its urban and rural areas under a US$180 billion (S$243 billion) “Build, Build, Build” infrastructure programme1. It is also rejuvenating its towns. Singapore companies can find business opportunities in infrastructure development under the public-private partnership model.
Several Singapore companies are working on such joint projects or bids in the Philippines. One such company is Changi Airport International, which has been appointed by a consortium of 7 Filipino conglomerates to rehabilitate the Ninoy Aquino International Airport.
Singapore Cooperation Enterprise is also paving the way for some Singapore companies to help Manila develop an intelligent transport system2. A new airport in Sangley to be built by the Cavite government also presents business opportunities for land reclamation3.
Opportunities also abound in other PPP projects in township, business park and industrial park development. The Philippines’ Bases Conversion and Development Authority has appointed Surbana Jurong to plan and design the 9,450 ha New Clark City, which is envisioned to be the Philippines’ first smart, green and disaster-resilient city4. New Clark City will be home to the National Government Administrative Centre where government agencies will be located, and will provide space for businesses and industries to grow. You can also tap New Clark City’s special economic zone location to gain tax benefits and incentives if you invest in the city.
Increasing demand for housing, a booming outsourcing sector and a revitalisation of the manufacturing industry are also driving strong growth in private residential, commercial and industrial developments. Singapore companies such as Keppel Land and The Ascott Group have ventured successfully into the Philippines and already have residential, commercial and hotel properties there. Your company can too.
1: “Duterte's Ambitious 'Build, Build, Build' Project To Transform The Philippines Could Become His Legacy”, Forbes, 28 February, 2018 2: “Singapore to Help the Philippines Deal with Traffic Woes with 'Intelligent Transport System'”, The Straits Times, 31 August 2017 3: “Cavite Government’s Sangley Airport Plan Gets Green Light from Transportation Dep’t”, Business World, 31 July 2018 4: “Surbana Jurong Inks Agreement to Develop New Clark City in the Philippines”, The Straits Times, 12 February 2018
The Philippines’ net power consumption rose by nearly 4% from 2016 to reach 94,370 GWh in 20175, and is estimated to triple by 20406. To ensure affordable and reliable energy to meet the growing power demand, the energy infrastructure market in the Philippines is opening up to foreign investment. More energy facilities will be built to expand conventional power generation.
The more than 7,000 islands of the archipelago hold great renewable energy potential. In 2011, the Philippines set a target to triple its renewable power capacity to 15.3 GWh by 2030. Renewable energy is expected to provide up to 25% of the Philippines’ total energy demand by 2025.7
Join Singapore companies such as TEE Infrastructure Pte Ltd, which invested in a 25MW greenfield power station in Mindanao in 2015. You can also enter the Philippines market through joint ventures, like what Sunseap did for a 62MW solar farm project development in Bulacan.
With solar energy and energy storage becoming increasingly economical, hybrid solar-diesel-battery microgrids are widely seen as the most viable. This opens up opportunities for Singapore companies to provide microgrid solutions and financing.
Half of the Philippines’ population live in urban centres. Of this, almost 25% live in the capital, Manila, which is the most crowded city in the world8. The resulting domestic and industrial demands on fresh water is tremendous.
Water management has improved with better enforcement of environmental laws and the growth of water supply systems. However, the Philippines still faces risk of water shortage within the next ten years, unless there is stronger management and conservation efforts9. The Philippines’ Department of Environment and Natural Resources has warned of a regional water crisis in Central Luzon, by 202510.
If you specialise in utilities solutions, your expertise in holistic and fully-integrated water management solutions across the entire value chain, from desalination and reverse-osmosis, to municipal and industrial water treatment, will be in great demand in the Philippines.
5: “PH Power Consumption Up Nearly 4% Last Year”, Manila Times, 9 April 2018 6: Power Development Plan 2016-2040, Department of Energy, Republic of the Philippines 7: Department of Energy, 6 April 2017 8: Asian Development Bank, 2014 9: Asian Water Development Outlook 2016, Asian Development Bank 10: “Regional Water Crisis by 2025: Pampanga’s Groundwater Source in Danger”, SunStar Philippines, 2 August 2017
The Philippines has a young population of more than 100 million which forms a significant consumer market. Income levels have risen as more Filipinos are employed in the booming Information Technology-business process outsourcing (IT-BPO) services industry. Another significant source of income is remittances from Filipinos working abroad, which accounted for 10% of the Gross Domestic Product in 201511.
Higher disposable incomes have led to Filipinos spending more on non-essential goods and services such as clothing, transportation, communication and leisure.
To serve those working in IT-BPO companies that operate round-the-clock, demand for 24/7 convenience stores and fast food has also gone up. Food delivery services are also becoming increasingly popular as a solution to bad traffic conditions and extreme weather conditions.
If you have a food or retail company, you can join the booming retail sector in the Philippines by partnering local companies and franchisees. Singapore brands such as BreadTalk and Charles & Keith have established their presence in the Philippines.
E-commerce growth has not taken off in the Philippines, primarily due to slow internet connection, logistic challenges for home delivery in the archipelagic country, and low credit card usage. It is also due to a strong “mall culture” as Filipinos use the shopping mall as a hub for social activities.
But the long-term potential for e-commerce is huge, with more than half the population having internet access and tech-savvy millennials replacing baby-boomers as top consumers today. Online shopping is poised for growth as digital banking gets more widely adopted over the next few years.
In 2017, Bangko Sentral ng Pilipinas and the Monetary Authority of Singapore signed a bilateral agreement on fintech collaboration12. Several of Singapore’s companies are already working with Philippines’ banks on adopting the latest fintech innovations to capture growth from a largely unbanked market. Singapore companies in the business of providing e-commerce solutions, payment gateways, login-security and anti user-account abuse services can also tap this window of opportunity to collaborate with Philippines retailers.
Beyond e-commerce, Singapore developers can explore bringing new retail concepts with a wider range of lifestyle retail experience to the Philippines. This could take the form of an integrated lifestyle hub that combines retail, food and beverage, community facilities such as the library, medical centre, and sports facilities.
11: Bangko Sentral ng Pilipinas 12: “BSP, MAS Sign Agreement on Fintech Collaboration”, Business World, 17 November 2018