What are the fast-growing industries in the Philippines?
- Real Estate Industry
- Construction Industry
- Manufacturing Industry
- IT and BPO Industry
If you’re an investor, you might be wondering about the fast-growing industries in the Philippines. The Philippines had an average annual growth increase of 6.4 from 2010 to 2019. However, just like other countries across the world, the economy took a major hit from the COVID-19 pandemic. There was a sharp downturn in logistics, tourism, consumption, and remittances.
Fortunately, there is a promising outlook for the Philippine economy due to the successful rollout of vaccines, declining disease transmission rates, and eased-up restrictions.
In a recent report by Bangko Sentral ng Pilipinas, the economy rebounded strongly with a growth rate of 12%. Amid sustaining the coronavirus containment, the unemployment rate fell, manufacturing activities moderated, and remittances grew. Coupled with an increasing consumer purchasing power, the Philippines remains an attractive prospect for investors.
Investors can focus on the following industries and sectors that are expected to grow significantly:
Real Estate Industry
The Philippine real estate industry remains a fast-growing sector. As the demand for day-to-day convenience increases, recent real estate property developers have shifted their focus on catering to specific resident needs. Workers and families want to be near essential establishments such as offices, schools, retail malls, and more. More property developers are setting up projects in central business districts.
There are positive forecasts for the long-term growth of the Philippine real estate industry because of the government’s Build, Build, Build (BBB) program, which introduced the “Golden Age of Infrastructure”. The creation of transport-oriented infrastructures is set to make previously hard-to-reach locations more accessible.
Some of the new highways, roads, and connectors built include the following:
- South Luzon Expressway (SLEX)
- Tarlac – Pangasinan – La Union Expressway (TPLEX),
- Cebu–Cordova Link Expressway (CCLEX)
- Southern Tagalog Arterial Road (STAR Tollway)
- Subic – Clark – Tarlac Expressway (SCTEX)
- North Luzon Expressway (NLEX)
- Cavite–Laguna Expressway (CALAX)
- Manila–Cavite Expressway (MCX).
The presence of more major thoroughfares encourages the construction of commercial and residential structures. This in turn, will drive prospective buyers to previously inaccessible areas. Investors can target real estate properties and expect to gain high returns.
Investors can also look forward to the growth of industrial real estate — development, manufacturing, storage, and shipment of goods.
What makes industrial real estate ideal is that it houses fast-growing, essential facilities. Manufacturing facilities, warehouses and logistics, and industrial parks typically fall under this sector. An example is the industrial parks developed by Science Park of the Philippines (SPPI).
SPPI industrial parks are the home of several Fortune 500 companies and other multinational companies such as Procter & Gamble, Pepsi, Pepsi, ST Microelectronics and Nexperia, First Sumiden, NEC, H.B. Fuller, and Nippon Paint.
Construction Industry
Another fast-growing industry expected to thrive in the next few years is Philippine construction. Before the pandemic, this industry was the fastest developing across Asia-Pacific. Although the sector was hit by the health crisis, it is expected to bounce back with a growth rate of 16.1 percent this 2022.
Again, the government’s Build, Build, Build program is fueling construction growth. A number of projects are lined up, but the key driver in the sector is transport infrastructure, particularly road and rail development.
As the development of the construction industry continues, more jobs will be created and the economy will grow — promising lucrative opportunities for investors.
Manufacturing Industry
Manufacturing was one of the industries heavily hit by the pandemic due to logistic restrictions and shifting consumer attitudes. In the Philippines, the demand for goods increased in the second half of 2021. However, the country suffered from material shortages and manufacturing operations were hindered.
This 2022, Philippine manufacturing was granted better mobility following the reduction in COVID-19 cases. In March, the manufacturing output in the country climbed up to 53.2, outperforming its ASEAN neighbors.
Foreign investors see great potential in the Philippine manufacturing industry. And while the pandemic did impact the sector, there are plenty of recovery signs. It is expected that there will be a robust GDP performance starting this April.
IT and BPO Industry
Despite being hit by the pandemic in early 2022, the IT and BPO industry still remains a key growth driver of the Philippine economy.
The Philippines is known to be the prime hub for BPO services. Filipino employees are proficient in the English landuage and are trainable in IT tasks as well. This attracts plenty of businesses to outsource services in the Philippines. As a result, the BPO industry contributes about $30 billion to the Philippine economy every year.
In addition, the emergence of more TELCO companies promises improvement in the country’s internet connection and speed. This adds competitiveness to the Philippines’ global digital employment.
Key Takeaway
In this article, we have listed some of the top, fast-growing industries in the Philippines. These industries have been bouncing back from the effect of the COVID-19 pandemic and helping sustain economic growth. As such, these industries are set to open new and lucrative opportunities for investors.
Ready to invest in the Philippines and get the best value from a thriving industry? Learn more about what SPPI can do for you by clicking here.
