The Philippines has a strong potential to participate in the post-Covid-19 global value chain on account of its robust services sector, according to the Asian Development Bank (ADB).
During the virtual launch of her institution’s Asian Economic Integration 2021 report on Wednesday, Cyn-Young Park, director of the ADB’s Regional Cooperation and Integration Division, highlighted this potential as the “post-pandemic trade landscape would give more weight [to] digital and services trade, and in all aspects the Philippines has a comparative advantage on the services sector and [is] service-oriented.”
According to the report, digital platforms and other technology-based tools are offering new growth opportunities for businesses and industries in Asia and the Pacific, which the ADB said could contribute significantly to the region’s recovery from the coronavirus pandemic.
“Even when they are not exporting, there is also an offshore call center where they provide services from the Philippines to the world, and these are some of the potentially good areas to benefit from different areas of more digitally connected globalization post-Covid,” Park said.
The report said accelerated digital transformation could boost global output, trade and commerce, and employment. It cited as an example the significant growth of digital-payment services last year and how platforms for these encouraged the shift to online transactions.
Citing Globe Telecom Inc. data, the ADB said that, in the Philippines alone, mobile wallet company GCash saw a 700-percent year-on-year increase in transactions in May and the number of its registered users double in the first half of 2020.
The report urged governments in the region to leverage on and reap the benefits of the emerging digital economy by instituting policies and reforms to improve digital infrastructure and connectivity, as well as access to them.
These include promoting fair competition and improving ease-of-doing business processes, and enhancing labor security and social-protection measures to align with digital jobs.
The report also emphasized the need to focus on data privacy and security, taxation, partnership between public and private institutions, and regional cooperation.
“Countries in Asia and the Pacific have leveraged rapid technological progress and digitalization to recover and reconnect to the global economy during the pandemic.
Technology is helping to forge new global linkages, which offer enormous economic opportunities, but also present new risks and challenges,” ADB Chief Economist Yasuyuki Sawada said.
“It is imperative to implement policies and regulations that manage the disruptions and maximize the gains from the burgeoning digital economy, and to lock in these gains through enhanced regional cooperation,” he added.