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The struggles and progress towards gender equality in the workplace

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In the early 20th century, women encountered substantial difficulties entering the workforce due to societal norms and gender-based expectations that restricted their professional growth and limited them to domestic duties. Merits, an open access peer-reviewed journal, revealed that the prevailing belief that women were less capable than men in professional settings perpetuated gender inequality.

Since then, women have been breaking down barriers in traditionally male-dominated industries, paving the way for future generations, setting up successful businesses, and ascending to leadership positions in companies and governments across the world.

According to United Nations (UN) Women, legal frameworks, such as anti-discrimination laws and affirmative action policies, have paved the way for greater gender diversity in various industries. Women now represent a substantial portion of the global workforce, holding positions across diverse sectors, including science, technology, engineering and mathematics (STEM); finance; politics; and entrepreneurship.

Globally, a data from the World Bank indicated that more girls are attending school and completing higher levels of education than ever before. In some regions, the gender gap in education has narrowed significantly, with girls outperforming boys in academic performance in certain subjects.

The “Women in the Workplace 2023” report by McKinsey & Company and LeanIn.Org, also revealed that women’s representation in the C-suite has reached its highest level ever, showing encouraging gains at the top levels of organizations.

Furthermore, entrepreneurship rates are high among women in lower- and middle-income countries where job options are limited, highlighting the link between employment and entrepreneurship, based on the latest report from the Global Entrepreneurship Monitor.

Meanwhile, the Philippines achieved the 19th position out of 146 countries as a gender-equal country in the world in the “2022 Global Gender Gap Index” report by the World Economic Forum (WEF). The “Gender Gap Index” measures gender equality based on the economic participation and opportunity, educational attainment, health and survival, and political empowerment, and the Philippines has long been considered as the top gender-equal nation in Southeast Asia.

According to a report conducted by World Bank, the Philippine government is taking steps to increase female participation in the labor force by promoting policies supporting flexible work arrangements, addressing gendered social norms, and enhancing childcare support.

For instance, the Philippine Magna Carta for Women, officially known as Republic Act 9710, aims to eradicate discrimination against women and bridge the gender gap in various sectors. One of the key provisions of this law is to ensure that women have equal access and opportunities in education, employment, and all aspects of society. The Act recognizes and affirms the important role of women in nation-building, promotes their empowerment, and ensures that men and women have equal rights and opportunities.

As per the Asian Development Bank, the government has initiated Women’s EDGE Plan, which consists of policy studies, pilot projects, technical services and resources to support the economic empowerment and advancement of women across various sectors.

Similarly, the Philippine Commission on Women (PCW) has developed sector plans and national development strategies to ensure the mainstreaming of gender equality across all government agencies. These efforts are being executed through the Philippine Plan for Gender-Responsive Development 1995-2025 and the Women’s Empowerment, Development, and Gender Equality Plan for 2013-2016.

The persistent challenges

Despite the progress towards gender equality, women still face challenges and disparities globally and locally. According to the UN Women’s report on “Progress on the Sustainable Development Goals: The Gender Snapshot 2023,” approximately one in every ten women worldwide lives in extreme poverty. If the trend persists, an estimated 8% of the global female population, totaling 342.4 million women and girls, will still be living on less than $2.15 a day by 2023.

In terms of employment, gender bias remains a pervasive issue in many workplaces. Women often encounter stereotypes and discriminatory attitudes that undermine their professional credibility and opportunities for advancement. According to the World Bank’s “Women, Business and the Law 2023” report, over 2.7 billion women worldwide are legally restricted from accessing the same job opportunities as men. More than one-third of economies globally have laws constraining women’s ability to work, with 43 economies lacking any laws addressing sexual harassment in the workplace.

The International Labour Organization (ILO) also emphasized on the gender disparities in access to social protection. According to their report, women are significantly less likely to have access to social protection acquired through employment, such as pensions, unemployment benefits, or maternity protection. Globally, women lag behind men by 8% in terms of coverage, with 73.5% of women in wage employment lacking access to social protection.

Despite ranking high out of 146 countries in the WEF’s Global Gender Gap Index, the Philippines still faces challenges in achieving full gender parity, particularly in political empowerment. According to a report titled “Gender Equality in the Labor Market in the Philippines” by the Asian Development Bank (ADB) and the ILO, the country has struggled to generate sufficient employment, particularly for women. The share of women in waged employment in the non-agriculture sector remains disproportionately low, indicating a persistent gender gap in labor force participation.

There is also a substantial gender gap in labor force participation, with only 49% of women actively engaged in the workforce compared to 76% of men, according to the World Bank. The similar data also revealed that several factors hinder women’s entry and advancement in the labor market, including limited skills development opportunities, care responsibilities, and gendered social norms.

One of the most common issues faced by women in the Philippine workforce is the significant wage gap. The ADB revealed that the estimated proportion of women’s annual earnings to men’s annual earnings stands at less than 60%. Similarly, the Philippine Institute for Development Studies (PIDS) reported that women earn only 71.6% of men’s income. A similar study also found that women in digital jobs earn 18.4% less than men.

Meanwhile, the United Nations Development Programme (UNDP) recently highlighted a statistic about the state of gender biases in Filipino society. According to their findings, 99.5% of the population holds biases against women. Such biases can lead to discrimination against women in various aspects of life, including education, employment, and social status.

A path forward

The future of women in the workplace hinges on concerted efforts to break down barriers, promote inclusivity, and create a culture that values diversity.

One of the most critical aspects of advancing women in the workplace is breaking down the barriers that prevent them from reaching their full potential. According to the ILO, these barriers can include systemic biases, unequal pay, lack of access to leadership positions, and work-life balance challenges.

Research conducted by McKinsey suggests that companies with inclusive cultures are more likely to outperform their peers. Diverse teams are better able to innovate, problem-solve, and adapt to change, making them more competitive in today’s rapidly evolving business landscape. This effort involves implementing policies and practices that support diversity, equity, and inclusion, as well as fostering a culture of belonging.

In addition, organizations globally are encouraged to actively work to address unconscious biases that may influence hiring, promotion, and performance evaluation decisions. Based on an article published by Harvard Business School, training programs, diversity initiatives, and mentorship opportunities can all help to mitigate these biases and create a more level playing field for women in the workplace.

In the Philippine context, the primary factors that limit women’s participation in the labor market are their responsibilities towards domestic work and caregiving, as well as their restricted access to resources such as education, training, government services, credit, and financial services, as mentioned by the ADB and ILO.

To address these issues, the ADB’s and ILO’s joint report recommends that the public and private sectors should take into account gender perspectives while making economic decisions. Gender mainstreaming, a principle on incorporating gender perspectives into all policies and programs, can help reduce the negative impact of policies on women and improve their economic empowerment. This can be achieved through initiatives such as collecting data that is disaggregated by sex, implementing gender-responsive budgeting, and setting targets and quotas to ensure that women are adequately represented in decision-making roles across all sectors.

Efforts to increase the engagement of women in technical and vocational education programs, particularly in nontraditional fields, are also encouraged for breaking gender stereotypes and expanding career options. Since women are often underrepresented in technical fields such as engineering, information technology, and manufacturing, providing women with the access to relevant technical and vocational education and training (TVET) programs is important to address this disparity. It is also suggested that the government must prioritize the development of tailored training initiatives that cater to the needs and interests of women.

Despite women making up a significant portion of the workforce in the Philippines, they continue to earn less than their male counterparts. The ADB and ILO stated that the concept of “equal remuneration for work of equal value” is crucial in addressing this disparity. While legislation exists to prohibit gender-based discrimination in wages, the report highlighted that comprehensive reforms are needed to enforce equal pay principles effectively.

To pave the way for a more inclusive and equitable workplace, it is suggested that policy makers should consider amending existing legislation to strengthen provisions related to equal pay and ensure enforcement mechanisms; developing and implementing an independent minimum wage-setting process that is transparent and inclusive; and introducing measures to limit the use of precarious work arrangements, such as multiple short-term contracts, to provide greater job security. — Mhicole A. Moral

SMC studying Metro Pacific’s Indonesian tollway assets for merger

SAN MIGUEL CORP. (SMC) said it anticipates finalizing the planned joint venture with Metro Pacific Investments Corp. (MPIC) in the coming months, pending the evaluation of its tollway arm’s Indonesian assets. 

“We will finalize this very soon, maybe in the next few months. The reason why I cannot say ‘yes’ entirely is we need to evaluate the Indonesian tollway, but Indonesia’s economy is very promising,” SMC President and Chief Executive Officer Ramon S. Ang told reporters last week.

SMC and MPIC have been in discussions regarding a possible joint venture for a toll road business.

MPIC Chairman, President and Chief Executive Officer Manuel V. Pangilinan is hoping to complete and publicly list the planned merger with SMC within the year.

“It will be a significant company in the Philippines with starting EBITDA (earnings before interest, taxes, depreciation, and amortization) of around P50 billion,” he said in February.

The valuation of the planned joint venture company also includes Metro Pacific Tollways Corp.’s (MPTC) Indonesian assets. 

MPIC’s tollways unit MPTC, through Metro Pacific Tollways Asia, holds 76.31% share in PT Nusantara Infrastructure in Indonesia. 

PT Nusantara Infrastructure owns infrastructure concessions in both the western and eastern portions of Indonesia. It operates businesses in transportation, toll roads, communication, and distribution networks.

In 2019, MPTC announced that it had purchased a significant share of PT Jasamarga Jalanlayang Cikampek, the concessionaire of the Sheikh Mohamed Bin Zayed Elevated Toll Road, which is a 38-kilometer flyover aimed at decongesting traffic in Jakarta.

“I think the Indonesian tollway [assets] should be good, but as I have said, I do not know the details. We cannot agree on something we don’t know,” Mr. Ang said. 

Among the considerations and issues being evaluated for the possible merger is that both companies will have to go to Congress to apply for a franchise for their operations, according to MPIC’s Mr. Pangilinan.

Mr. Ang said he is confident that securing the necessary approvals from the government will not be a problem for the two parties.

“For as long as your intentions are good, it  will be easy to put forward in Congress,” he said.

MPTC has announced that it is deferring its initial public offering plans to 2025 as the company weighs its options to form a joint venture with SMC.

MPIC is one of the three key Philippine units of Hong-Kong based First Pacific Co. Ltd., the others being Philex Mining Corp. and PLDT Inc.

Hastings Holdings, Inc., a unit of PLDT Beneficial Trust Fund subsidiary MediaQuest Holdings, Inc., has a majority share in BusinessWorld through the Philippine Star Group, which it controls. — Ashley Erika O. Jose

Mining companies seen to pose mixed results this year

BW FILE PHOTO

By Sheldeen Joy Talavera, Reporter

LISTED mining companies are expected to deliver mixed results this year, buoyed by global demand for essential metals but weighed down by regulatory and environmental uncertainties, according to analysts.

“The outlook for mining companies in FY (financial year) 2024 appears promising, driven by both domestic and global factors supporting growth and expansion,” Globalinks Securities and Stocks, Inc. Head of Sales Trading Toby Allan C. Arce said in a Viber message last week.

Essential metals such as gold, nickel, cobalt, copper, and iron are “in demand” due to their importance in renewable initiatives and emerging technologies, he said.

“As the global shift towards these technologies continues, the demand for these metals is expected to remain strong, benefiting mining companies,” Mr. Arce said.

Investors consider risks such as regulatory changes, environmental concerns, and global market dynamics when evaluating investment opportunities in the mining sector, he also said.

Regina Capital Development Corp. Head of Sales Luis A. Limlingan said that there is still cautious optimism regarding the performance of mining firms for the year.

“Although favorable commodity prices and regulatory enhancements could boost growth, challenges such as regulatory uncertainties and environmental issues remain significant,” Mr. Limlingan said in a Viber message.

For 2023, nickel ore producer Global Ferronickel Holdings, Inc. reported a 19.6% decline in its attributable net income of P1.5 billion while revenues grew by 30.5% to P8.8 billion.

Philex Mining Corp. recorded an attributable net income of P1.02 billion, down 43.3% from the previous year, mainly due to lower revenues from its gold and copper operations. Revenues dropped by 16.3% to P7.73 billion.

Atlas Consolidated Mining and Development Corp. saw a decline of 65% in its consolidated net income to P1.1 billion as the company repaid loans and prices of copper decreased.

The company’s revenues went up by 13% to P19.91 billion last year.

Meanwhile, Nickel Asia Corp. enjoyed a 1.5% increase in its attributable net income to P7.93 billion brought by higher nickel ore prices. Revenues from ore sales dropped by 16% to P21.4 billion.

For the third quarter, Apex Mining Co., Inc. posted an attributable net income of P1.03 billion, higher by 14.4% from the previous year.

Gross revenues rose by 10.7% to P3.04 billion in 2024.

“Bottom line is, mining firms have potential for growth, but they must effectively manage challenges in order to capitalize on opportunities this year,” Mr. Limlingan said.

For 2023, the country’s metal production by value increased by 4.8% to P249.05 billion driven by the improved prices and higher output, data from the Mines and Geosciences Bureau showed.

Orient Star opens first boutique in the Philippines

HOST DAVID CELDRAN welcoming the guests

ORIENT STAR, a higher-end brand of popular watch brand Orient, opened its first boutique in the Philippines at the Mitsukoshi BGC mall on March 21.

While the company started making watches in 1901, the company was formally known as the Orient Watch Company in 1951. During the quartz watch boom in the 70s and 80s, the company sought a revival of mechanical watches, many of which are still made today.

In 2017, the brand became a part of Epson (as in the printer company). Toru Murauchi, General Manager for WP Sales and Marketing Department, Sales and Marketing Division for Epson, outlined the relationship between the electronics company and the watch brand. “Epson has been providing timepieces for over 80 years,” he said. While Epson began as a company manufacturing parts for the Seiko group, it began to make printers in response to a requirement during the 1964 Tokyo Olympics.  He gave an example of Epson’s know-how helping give rise to their new F8 movement, launched in 2021, which uses a silicon escape wheel, that allows the watches to have a 70-hour power reserve.

Meanwhile, Naoto Ueda, Deputy Chief Operating Officer of Wearable Products Operations Division of Seiko Epson, said, “As we expand Orient Star in the Philippines, we want to share our masterful range of models, which expertly balance precision mechanical movement with modern design and fashion-forward color combinations. Our Japanese artisans have masterfully crafted the mechanical watches to endure over time. We also can’t imagine a better place to open the first Orient Star boutique than Mitsukoshi BGC.”

Mr. Murauchi said, “For a long time, Orient Star focused on the Japanese market. We’ve just started Orient Star branding relationships worldwide. Fortunately, we met with the Lucerne Group, and we caught a big opportunity to start the Orient Star business in the Philippine market.” He also said that they plan to open more boutiques in the country in the future.

The boutique is located on the Ground Floor of Mitsukoshi BGC. — JLG

BDO Unibank, Inc.: Notice of 2024 Annual Stockholders’ Meeting

BDO Unibank, Inc. will hold its Annual Stockholders’ Meeting on April 19, 2024, Friday, at 2:00 p.m., at the Forbes Ballroom 1, Third Floor, Conrad Manila, and will be livestreamed for stockholders participating remotely.

 

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Filipino expert on psychology of startup teams recognized by Thinkers50 Radar

Martin Gonzalez

Martin Gonzalez, an expert on the psychology of startup teams and creator of Google’s Effective Founders Project, a global research program that uses people analytics to uncover what makes the best startup founders succeed, was recently recognized by the Thinkers50 Radar.

Every year, the Thinkers50 Radar list identifies 30 individuals across the globe with breakthrough ideas predicted to make an important impact on management thinking in the future. Dubbed by the Financial Times as the “Oscars of management thinking,” Thinkers50 tags itself as the world’s most reliable resource for identifying, ranking, and sharing current leading management ideas.

“I feel honored to be recognized by this year’s Thinkers50 Radar. It underscores the critical role of building healthy, resilient teams in driving innovation and scaling businesses,” Mr. Gonzalez said.

Mr. Gonzalez, the only Filipino on the 2024 list alongside management scholars and published authors across America, Europe, and Asia, was recognized for his research anchored on the notion that most startups fail not because of fund mismanagement, bad product timing, or bad product design but because of people problems.

Further dissecting this idea, Mr. Gonzalez, together with the co-founder of the Google for Startups Accelerator Josh Yellin, is launching a book entitled The Bonfire Moment, where they discuss the common traps and challenges that hinder the growth of startups. Messrs. Gonzalez and Yellin also conduct one-day workshops of the same name with companies of various sizes worldwide to help founders effectively navigate these traps.

In the Philippines, Mr. Gonzalez continues to work as a startup advisor to the portfolio companies of Kickstart Ventures, a corporate venture capital (CVC) firm wholly-owned by Globe Telecom, and has recently become a venture partner at Kaya Founders, a VC firm that backs industry-shaping digital companies. He has also shared his expertise in startups and people development at DigiCon, People Management Association of the Philippines (PMAP), and IdeaSpace.

Mr. Gonzalez was also recognized by The Aspen Institute as a First Movers Fellow last year, the first Filipino to achieve this recognition, for his pioneering work at Google. He is currently a principal of organization and talent development at the world’s leading search and advertising company, working with senior leaders to shape team culture, develop their people, and expand their leadership.

Apart from Google, he is a frequent lecturer on entrepreneurship, organization design, and people analytics at Stanford, Wharton, and INSEAD.

Head over to www.bonfiremoment.com to learn more about Mr. Gonzalez’s insights on why building teams is essential to startup success.

Airline fuel surcharge unchanged for April

PHILSTAR FILE PHOTO

THE Civil Aeronautics Board (CAB) has retained the airline fuel surcharge at Level 6 for April.

The Civil Aeronautics Board has announced that the airline fuel surcharge, which is added to the base fare, will remain at Level 6 next month.

At Level 6, the domestic passenger surcharge ranges from P185 to P665, while the international surcharge ranges from P610.37 to P4,538.40.

“Airlines wishing to impose or collect fuel surcharge for the same period must file its application with this office on or before the effectivity period, with fuel surcharge rates not exceeding the above-stated level,” CAB Executive Director Carmelo L. Arcilla said in an advisory. 

A fuel surcharge may be collected by airlines based on the movements in jet fuel prices, based on a benchmark known as MOPS (Mean of Platts Singapore).

The applicable conversion rate for April is P56.01 to a dollar, CAB said.

Flag carrier Philippine Airlines (PAL) said it will focus on-time performance as it expects higher passenger volume next month. 

“Passenger loads remain high amid the current peak travel season. We are grateful for the continued customer loyalty and support. We remain focused on maintaining our on-time performance and schedule reliability,” PAL Spokesperson Cielo C. Villaluna said in a Viber message.

BusinessWorld also reached out to Cebu Pacific and AirAsia but has yet to receive comments as of the deadline. — Ashley Erika O. Jose

Villeroy & Boch opens new showroom

THE COLLARO COLLECTION

GERMAN ceramics manufacturer Villeroy & Boch launched its new showroom at their distributor Focus Global, Inc.’s headquarters at the Twenty-four Seven McKinley Building in Bonifacio Global City (BGC) on March 21. The showroom shares space with Dornbracht, a German manufacturer of bathroom fittings and fixtures. Both brands had interactive showcases that allowed guests to turn on taps and test the bathtubs, showers, faucets, and toilets they offer.

The brands’ selections were offered up for testing through bathroom setups in an event called “Odyssey: The Artistry of a Sensory Bathroom.” Five bathrooms were decorated to give the feel of real homes, using lights, sound, and even scent (through diffusers and scented candles).

Antao, one of Villeroy & Boch’s newest collections, draws inspiration from nature, capturing elements such as the gentle shape of dewdrops. This resulted in sinks and bathtubs in a very distinct dewdrop shape, and are executed in matte earth tones. The Venticello collection showcases rimless water closets, asymmetrical sink cabinets, and clean designs, showing off sophistication. A highlight was the Hommage collection, inspired by the opulent lifestyle of the Regency era in England (think the late 1700s to the early 1800s). This collection combines classic design elements, featuring standalone tubs with metal feet, and toilet seats made of luxurious wood. The Collaro collection has a delicate lineup showing slum washbasins and acrylic wall-attached tubs that give a cozy feel. To show off this line, they decorated this bathroom with flowers. The minimalist Subway 3.0 collection shows off slim shapes with surprising space allowances (such as in their cabinets and vanity units), but also new technology for their toilets. BusinessWorld was taken around the exhibition and we were shown this collection’s toilet, with a powerful vortex flush (it wasn’t activated that day, but the shape of the toilet allowed us to see how water would travel within the unit).

“Villeroy & Boch has been creating premium bathroom products for 275 years now. We are proud to continue showcasing the brand’s long-time commitment to excellence through our well-crafted products here in the Philippines,” said Hong Li, Managing Director of Villeroy & Boch APAC in a statement. Villeroy & Boch celebrated its 275th anniversary last year, tracing its origins back to 1748 in the Holy Roman Empire. It also has a Dining and Lifestyle selection, with a separate showroom at Mitsukoshi BGC (and distributed in the Philippines through another partner). Meanwhile, Jin Long, Regional Sales Director of Dornbracht SEA, said, “In essence, Dornbracht is more than just a manufacturer of luxury fittings; it is a symbol of excellence, craftsmanship, and vision. “We’re hoping that this collection can remind our current and future customers why the bathroom is a self-care space worth investing in.”

The showroom is on the 11th Floor of Twenty-four Seven McKinley Building. — JLG

Growth drivers

XB100-FREEPIK

In a meeting among economists in a foreign embassy, former Bangko Sentral ng Pilipinas (BSP) Governor Felipe Medalla expressed his concern that the Philippines lacks a growth driver that it had in the past years with the business process outsourcing (BPO) industry. BPO revenues went from a few million in 1992 to $35 billion last year, contributing greatly to dollar revenue and GDP growth.

What could the next growth drivers be?

Mining is one candidate. It’s often mentioned considering the world’s need for critical minerals like copper, nickel, and lithium in the green transition to EVs (electric vehicles). The Philippines is one of the most mineralized countries in the world. As one Australian government paper noted, “The Philippines is one of the world’s most richly endowed mineral resources countries. It is estimated to have about $1 trillion worth of untapped copper, gold, nickel, zinc, and silver reserves. Only 5% of these reserves have been explored, and 3% are covered by mining contracts.”

The country still has a long way to go to fully exploit its mining potential. There are many noisy opponents to mining, from the Catholic clergy to environmentalists, leftists, and even LGU executives who believe they aren’t getting a fair share of the mining firms’ revenues.

The uncertain tax environment is also a deterrent to mining investment. The Department of Finance has recently come out with a mining tax proposal that will enable the government to get its fair share of revenues, based on profitability or net margin. If passed, the mining tax bill can give some certainty to potential investors and help lure more investments in mining.

Also, it’s unfortunate that exploitation of natural resources was left out in Congress’ resolution to remove foreign ownership restrictions in the Constitution. Mining is capital-intensive and there’s just not enough Filipino capital to exploit our abundant mineral resources.

Tourism is another candidate. We have had problems promoting tourism even though our beaches, mountains, and other natural wonders are far superior to those of Thailand. Lack of infrastructure, peace and order, poor healthcare facilities, and shenanigans by Immigration and airport personnel in our airports have discouraged more tourists from coming in. We don’t even have a world-class arena to host a Taylor Swift concert even if she could come. The Philippine Arena is a traffic magnet during concerts — just ask those who attended the Cold Play concert.

However, there is hope. NAIA will be handed over to a private operator at last and San Miguel Corp. has promised to modernize it even as it’s building a bigger one in Bulacan. Clark International Airport can easily expand and will be connected by railway to Metro Manila by 2028.

With the right policy mix and infrastructure investments, tourism can replace BPOs as a growth driver and dollar earner.

I have always been a booster of the forestry industry. The Philippines has a comparative advantage in forestry because it’s in a tropical zone. The Philippines can produce 100 cubic meters of timber per hectare compared to countries in the temperate zone like Finland where the output is anywhere from five to 15 cubic meters per hectare. Experts figure that the forestry industry can contribute as much as 2% of GDP. (In Finland, it’s 8%.)

Forest production or tree farming has enormous potential benefits, not just to the furniture and wood industries, but to climate change mitigation, energy production, water management, agriculture, carbon capture, and so many more. It will even boost tourism because forest trekking and forest bathing can be promoted as part of adventure tourism.

However, the potential of the forestry industry can be realized only when investors in tree plantations are given secure property rights because it takes so long to grow a tree to maturity (the earliest would be 13 years for fast-growing species). In some cases, especially for hardwood, it takes around 20 years, by which time, a concession agreement under the present rules would expire. The present rules only allow for 25 years, extendible for another 25 years, but the investor is at the mercy of the Department of Environment and Natural Resources.

This is why the Foundation for Economic Freedom is proposing a bill that would: a.) define planted trees as personal property. In other words, the law will treat planted trees like any other commercial crop, such as cabbage or potato. This will exempt tree farms from arbitrary log bans, allow foreigners to invest, and make them bankable; and, b.) consider trees as renewable resources, and not depletable natural resources. Since planted trees are not natural resources, these would exempt them from the 25-year rule.

Another growth driver could be defense industries because geopolitics is presenting the Philippines with an opportunity to develop Philippine-based defense industries. Japan, for example, would be doubling its defense spending in the next few years. Europe and the US are also hiking defense spending. We could present ourselves as part of the secure and friendly supply chain to our allies’ defense requirements, from supplying semiconductors for drones to uniforms.

Cultural and service exports could be another winner. However, in excluding mass media and the practice of professions in the liberalization of foreign ownership restrictions in the Constitution, Congress may have handicapped our ability to do cultural and service exports.

We could be exporting culture or soft power like what South Korea is doing. After all, we have much better singers, dancers, musicians, and the like. However, access to capital and technology is critical. We can’t access foreign capital to develop our cultural industries because investment in those industries could be interpreted as a violation of the Constitution.

We could also be exporting services, from healthcare to engineering. However, access again to capital and technology is constrained by the Constitution, which limits the practice of professions to Filipino citizens. Just getting a foreign faculty member to teach in a local university requires so many permissions. We need to open ourselves up to global talent if we are to export services. The US can “export” the NBA because the latter welcomes talent from anywhere in the world, whether Greece (Giannis Antetokounmpo), Serbia (Nikola Jokic), or China (Yao Ming).

There can be no shortage of growth drivers for the Philippine economy, given political will and the removal of binding constraints. Even agriculture, which contributes a mere 10% to GDP, can become a growth driver if the binding constraints of land fragmentation and agricultural protectionism are seriously tackled. Unfortunately, agriculture is one area where the administration is failing to address binding constraints.

Overall, the administration is moving in the right direction by promoting investments through liberalizing foreign investment restrictions and increasing access to markets (RCEP, Free Trade Agreements or FTAs with South Korea, and possibly Canada and the EU.) A more investment-friendly climate would drive investments in these growth sectors.

 

Calixto V. Chikiamco is a board director of the Institute for Development and Econometric Analysis.

idea.introspectiv@gmail.com

www.idea.org.ph

Exporters betting on ‘robust’ overseas market for PHL salt

PHILIPPINE STAR/EDD GUMBAN

THE PHILIPPINE Exporters Confederation, Inc. (Philexport) said that it is hoping that the Philippine Salt Industry Development Act will unlock the overseas market potential of Philippine salt.

In a statement, Philexport President Sergio R. Ortiz-Luis, Jr. said Republic Act (RA) No. 11985 “will help the salt industry recover and encourage small-scale sea salt producers forced out of business to resume production.”

“It is also our hope that this law will make possible once again robust exports of salt from the Philippines,” Mr. Ortiz-Luis added.

The exporter organization said salt exports declined to $67,894 in 2020 from $190,029 in 2019.

“World export of salt in 2021 exceeded $2.59 billion, indicating vast potential for Philippine exports,” the group said.

The group added that the law lifts the requirement for all Philippine salt to be iodized, which was mandatory under the An Act for Salt Iodization Nationwide Law or the ASIN Law, which was designed to eliminate iodine deficiency disorder.

“But while with good intentions, the ASIN Law seriously affected sea salt production and exports and made the Philippines dependent on imports, with the country bringing in about 550,000 metric tons of salt every year or 93% of its salt requirements,” Philexport said.  “This is despite the country’s 36,000 kilometers of shoreline, the fifth longest shoreline in the world,” it added.

It said that Philexport, together with other business groups, had been asking for natural sea salt to be exempt from the mandatory salt iodization under the ASIN Law.

Under RA 11985, a salt industry development roadmap will be drafted to ensure the revitalization of the salt industry. “(These) are aligned with the objectives and continued implementation of the ASIN Law,” the Philexport said.

Aside from the roadmap, the law will also create a Salt Council which will ensure the implementation of the road map and accelerate the modernization and industrialization of the salt industry. — Justine Irish D. Tabile

Breaking barriers women encounter in entrepreneurship

Photo by our-team on Freepik

Entrepreneurship, by its very nature, entails innovation, risk-taking, and the creation of value, all of which are key drivers of economic growth and development. It was the entrepreneurial mind that created the steam engine, mechanized industry, and the internet. So, it not only makes sense for a society to encourage entrepreneurs, but enable, support, and empower them.

Unfortunately, there is a troubling disparity in the number of women who become entrepreneurs compared to the men. According to data compiled from the We-Data project of the Women Entrepreneurs Finance Initiative (We-Fi) from 2014 to 2020, all over the world the share of female entrepreneurs tends to be lower than the share of male entrepreneurs in the three categories: the owners of limited liability companies, directors of limited liability companies, and sole proprietors.

In fact, in all 81 economies in the study, women represent on average 1/4 of new business owners and directors while men stand for 3/4 of new business owners and directors.

“The rates of female participation for sole proprietors are slightly higher. The average share of female sole proprietors is about 1/3 compared to 2/3 for the average share of male sole proprietors. In a few rare instances, there are more female sole proprietors than male sole proprietors. This is the case in Austria, where women represented 54% of new sole proprietors in 2020,” a report published by the World Bank said.

However, the report noted that sole proprietorship typically signifies small scale, low-profit and low-risk businesses, and notably does not protect personal assets of entrepreneurs as well as limiting them in their expansion.

“While this type of company can be a good way to enter formal entrepreneurship, it can prevent women from growing their business,” the report said.

An economic issue

When comparing the percentage of women in the entrepreneur population to the adult population, there are bigger disparities. In Somalia, despite comprising 50% of the adult population, women only represent 2% of new business directors. These gaps highlight deeper societal inequalities and access barriers to institutions, often exacerbated by weak rule of law.

In this context, gender inequality is not only a moral and social issue, it becomes an economic one. According to a 2015 study by McKinsey Global Institute (MGI), the global economy could expand by as much as $12 trillion by 2025 by closing gender gaps in work and society.

“A ‘best in region’ scenario in which all countries match the rate of improvement of the fastest-improving country in their region could add as much as $12 trillion, or 11%, in annual 2025 GDP (gross domestic product),” the study found.

“In a ‘full potential’ scenario in which women play an identical role in labor markets to that of men, as much as $28 trillion, or 26%, could be added to global annual GDP by 2025. MGI’s full-potential estimate is about double the average estimate of other recent studies, reflecting the fact that MGI has taken a more comprehensive view of gender inequality in work.”

Needless to say, an economy cannot operate at its full potential if half of its population cannot fully contribute to it. Women all over the world only contribute to 37% of the global GDP, according to World Bank estimates.

A bigger loss is that of opportunity. When women become entrepreneurs, they not only contribute to the overall economic output but also bring unique perspectives, insights, talents, and solutions to the forefront, enriching the business landscape and fostering diversity and inclusivity.

Social impact

Moreover, women’s entrepreneurial activity goes beyond economic considerations; it has broader societal implications. Women-owned businesses often prioritize social impact, community development, and sustainable practices, thereby contributing to social welfare and environmental sustainability.

Researchers at Columbia Business School and Carnegie Mellon University found that women are more motivated by messages about social impact than by those about money, while men are more motivated by messages about money. This was determined by looking at how entrepreneurs responded to messages about money and social impact.

“Our findings suggest that it’s important to have a broader conceptualization of the motivations of innovative entrepreneurs that focuses on motivations beyond profit, and that accounts for fundamental dimensions of heterogeneity such as gender and culture,” Jorge Guzman, assistant professor of management at Columbia Business School, who coauthored the study, said. “The results can inform interventions that foster innovative entrepreneurship policies and programs.”

There is also the importance of representation. Women entrepreneurs serve as role models and catalysts for change, inspiring other women and girls to pursue their entrepreneurial aspirations, challenging traditional gender norms, and empowering communities.

Barriers

But what bars equality? One of the most significant ones is education. The We-Fi report found that there are lower secondary education completion rates for women compared to men, particularly in regions like South Asia and Sub-Saharan Africa, where business entry rates are also low.

“In South Asia, 60% of men have at least some secondary education, compared to 40% of women. In Sub-Saharan Africa, 39% of men have at least some secondary education, compared to 29% of women. South Asia and Sub-Saharan Africa tend to have the lowest levels of business entry — with a median new business density below 1 new limited liability company per 1,000 adults,” the report said.

“Economies where women have more years of education also have relatively higher numbers of new female entrepreneurs, at the level of both business owners and sole proprietors.”

Access to technology, including smartphones and mobile internet, is another crucial determinant, with a persistent gender gap hindering women’s entrepreneurial endeavors, especially notable amid the COVID-19 pandemic, where digital connectivity became paramount for business operations.

According to the study, about 327 million fewer women than men have a smartphone and can access the mobile internet worldwide. Women are 26% less likely than men to have access to a smartphone.

Both financial and digital literacy are essential to doing business post-pandemic, and governments all over the world can stand to benefit from a stronger push to promote them.

More difficult to address — and perhaps more significant — are the invisible barriers. Ingrained cultural beliefs and invisible barriers perpetuate gender inequality, with biases against women still prevalent, hindering their full participation in the economy.

“Economic bias still exists in many economies. Overall, 40% of men and women feel that men make better business executives and that men have more right to a job when jobs are scarce in 2020,” the report found.

“This is part of the invisible barriers that women face in achieving equality. Measuring those barriers and quantifying the various sides of the equality gap help design better policies and provide a level-playing field for all.”

Women entrepreneurship in the Philippines

Through the implementation of multiple financial inclusion policies that prioritize technology and entrepreneurship, the Philippines has achieved significant progress toward gender parity and financial inclusion.

According to a study by the Asian Development Bank (ADB) titled “Measuring Progress on Women’s Financial Inclusion and Entrepreneurship in the Philippines,” as of 2020, the MSME sector numbered more than 950,000, the majority of which were owned by women. This advancement of women’s empowerment and financial inclusion are bolstered by digitization and digital finance. However, it is not without its problems.

After market access, the second biggest obstacle to MSMEs’ expansion was their lack of access to cash and credit. Due to the traditional assessment procedures that underpin financial institution services, small firms, and particularly women-owned and micro-enterprises, still face challenges in obtaining financing.

Compared to one-third (37%) of men-owned MSMEs, more over half (58%) of women-owned MSMEs identified difficulty obtaining financing. Because they believe that the application procedures, paperwork needs, and costs are more complicated than those of men-owned MSMEs, women-owned MSMEs are less likely to apply for funding.

The use of financial services and products by male and female entrepreneurs also differs significantly based on gender. According to the ADB data, since personal accounts are used by most women-owned MSMEs for business transactions, they have limited access to other financial services.

Comparing them to men-owned MSMEs, 39% of male entrepreneurs utilize business or merchant accounts, while only 17% of women entrepreneurs do. Moreover, when compared to their male counterparts, it was found that female entrepreneurs utilize fewer banking services for a variety of accounts and associated services.

“Awareness and comprehension of the benefits associated with opening a business or merchant account need to be enhanced for women to deepen their use of financial services, and strengthen and grow their businesses,” the ADB report said.

“Only 4% of WMSMEs (compared with 14% of men-owned MSMEs) use invoice financing and 9% had a business loan (compared with 12% of men-owned MSMEs). However, 27% of WMSMEs save for emergencies versus 19% of men-owned MSMEs.”

A lot of MSMEs continue to conduct business using personal accounts. According to focus group discussions from the study, micro and small businesses believe that applying for business loans in their own names is simpler, quicker, and less expensive than utilizing business accounts.

There is also the fact that less than 20% of respondents who operate small businesses said they have used business loans, overdrafts, invoice financing, or letters of credit. This suggests that a significant fraction of small enterprises is “banked but not yet banking.”

Finally, despite the fact that digital financial services (DFS) are essential to financial inclusion and women’s empowerment, there remains a significant gender gap in the use of these technology and services: While 44% of male-led MSMEs adopted such services, just 28% of female-led MSMEs do the same.

Addressing such issues will be a long and arduous process for the government and the Philippine financial sector. However, there are some low-hanging fruit that the ADB recommended picking first.

“Having available and up-to-date statistics on MSMEs segregated by gender remains the main challenge in developing and implementing effective policies and strategies to support MSMEs in general and WMSMEs in particular,” the ADB pointed out.

“As of 2022, there are no reliable data or information on WMSMEs, which hampers the understanding of the WMSME market size and use of financial products and services. Data on MSMEs include information on the type of enterprise, sector, and regional distribution, but are not sex-disaggregated.”

As data on MSMEs could be easily collected when firms register for the required permits (barangay, DTI, SEC, etc.), this simple process would do a lot to help strengthen efforts to address the gender gap.

Bolstering digital financial infrastructure could also provide a large impact in the pursuit of financial inclusion and gender parity, as less than a third of all women entrepreneurs benefit from digital financial services.

“Social networks play an important role in exchanging information and experiences, particularly for WMSMEs. Awareness-raising campaigns on digital financial services and platforms supported by the government and its agencies foster trust and confidence in DFS,” the report said.

“The goal is to enable female entrepreneurs to obtain and use the services, know the benefits of using them, and be confident in using them, enabling them to make informed financial decisions. The government needs to invest more in education and awareness-raising initiatives and leverage community structures to support such campaigns and programs. All players need to work closely together, ensuring synergies and complementarity to foster the use of financial products and services, aiming at increasing the financial inclusion of MSMEs, particularly WMSMEs.” — Bjorn Biel M. Beltran

Ports repurposing for offshore wind may cost $80 million — DoTr

THE Department of Transportation (DoTr) said repurposing ports for offshore wind development will cost around $80 million.

“Right now, we are doing the freight flow analysis that will eventually lead to a roadmap of ports development all over the Philippines,” Elmer Francisco U. Sarmiento, Transportation undersecretary for the maritime sector, said on the sidelines of a ports and logistics forum last week. 

The DoTr has started the study, Mr. Sarmiento said, adding that the agency expects to release the roadmap for ports development in the next two to three years.

“We have started the [freight flow analysis], maybe it will be completed [soon] hopefully. Our roadmap for port development, maybe in two to three years,” he said.

Freight flow surveys are part of the study to determine if ports are suitable sites for offshore wind development.

The Department of Energy (DoE) and the DoTr are leading agencies tasked in ports repurposing to advance offshore wind development in the Philippines. 

Ports will play a crucial role in offshore wind development as their supply chains, infrastructures and other components will be transported from mainland to offshore sites.

“We are studying offshore port development. It is very expensive, our estimate is that it goes up to $80 million,” he said. 

The DoTr said they have identified at least nine potential ports for the offshore wind project. These are: Philippine National Oil Co. Energy Supply Base Port, Mabini, Batangas; Port Irene, Cagayan; Iloilo Commercial Port Complex, Iloilo City; Pulupandan Seaport, Negros Occidental; Port of Currimao, Ilocos Norte; International Container Terminal’s Bauan International Port, Bauan, Batangas; Calabanga Provincial Port, Camarines Sur; and Bulalacao Port, Mindoro Oriental. 

Earlier, the Energy department said it was still studying recommendations for candidates as the 10th port for offshore wind development.

To date, the Energy department has awarded a total of 82 offshore wind energy service contracts, with a potential capacity of 63,000 megawatts (MW) or 63 gigawatts (GW). 

Based on the Philippine Offshore Wind Roadmap, the country has an estimated potential of 178 GW in offshore wind resources. 

The Philippines is expecting its first offshore wind project to be completed by 2028, with at least 10 offshore wind projects at a capacity of more than 6,000 MW expected to generate power in the next four years.

Offshore wind resources are expected to help the Philippines reach its goal of increasing the share of renewables to 35% by 2030 and 50% by 2040. — Ashley Erika O. Jose

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