The Philippines boasts a dynamic economy spurred by a robust middle class that makes up the majority of its highly competitive workforce. Its increasing urbanization and a strong consumer demand makes it one of the countries to watch out for in the Asia Pacific region.
Interested in creating a startup business in the Philippines? Learn more about the country and the best sectors to invest in. Here’s a list of the top-performing industries in the Philippines to guide you:
Known for being a tropical paradise, it’s no surprise that the Philippines counts tourism among its highest performing industries. A substantial portion of the country’s annual gross domestic product (GDP) comes from the tourism sector. This covers businesses such as cruise lines, hotels, resorts, and other operations under the hospitality and leisure category.
According to the Department of Tourism (DOT), the industry saw an all-time high of $9.31 billion or P482.15 billion in visitor receipts in 2019. This is 20.81% higher than the 2018 figure of $7.71 billion. For 2019, the country rang in an average daily expenditure of $128.35, with an average length of stay of 9.49 nights. Foreign guests incurred an average per capita expenditure of USD1,218.04 for their whole trip.
Double-digit visitor growth rates were observed from February to December 2019, peaking in August at 31.45%. Meanwhile, December recorded the largest volume at $872.13 million.
The top visitor market was accounted for by South Korea with tourism spending of about $2,614,685,263, followed by China with $2,330,491,557 and the United States with $1,208,907,514.
Aside from earnings at an all-time high, 2019 also witnessed several tourism milestones as the Philippines achieved its targeted 8.2-million international arrivals. With the tourism industry seeing such substantial growth in just a short time, projections for the coming year are optimistic
The Philippines has become the premier outsourcing destination in Asia. The highly educated workforce, an excellent work ethic, and outstanding value for money make it a top spot for investors who are looking to outsource.
To ensure the continued growth of the outsourcing industry, the government has invested heavily in making the workforce globally competitive. The Smarter Philippines through Data Analytics R&D or SPARTA is a program that aims to train 30,000 people in data science and analytics. The Philippines’ human capital is what gives it an edge over neighboring countries.
In less than two decades, the business process outsourcing (BPO) sector has grown considerably. Back in 2000, the industry accounted for a mere 0.75% of the country’s GDP. The industry has expanded to account for 12 to 15% of GDP in 2019.
BPO companies are now expanding operations beyond major cities like Manila and Cebu into other regions and cities like Davao and Iloilo. The rapid growth of this sector is only expected to continue as the government lays out tax reforms and public venture programs to attract more direct foreign investments.
Another of the largest contributors to the Philippine economy, the manufacturing industry accounts for over 22% of overall GDP. In 2019, it recorded a growth rate of 3.7%, a modest improvement over 2018’s rate of 3.2%. Nevertheless, the industry remained robust thanks to the expansion of food manufacturers, chemical products, raw materials, and electrical machinery.
Overall, this industry has performed consistently, contributing over 20% to the GDP throughout the years.
Manufacturing has also garnered 33.51% of all foreign direct investments. In the first quarter of 2019 alone, the manufacturing industry received 76.1% of total foreign investment pledges, equivalent to P35 billion. This considerable growth is an indication that foreign investors see the potential for more growth in the Philippine manufacturing industry. The following are the top subsectors in manufacturing:
This sector is one of the most important industries in the country. It promotes long-term productive employment and offers plenty of opportunities for innovation.
The construction industry grew by 10.7% in the fourth quarter of 2019. The significant expansion seen in this sector can be attributed to the Philippine Government’s Build, Build, Build (BBB) Program which focuses on creating large-scale jobs in transportation and energy.
Market analysis firm Fitch Solutions notes that the BBB Program has already attracted more foreign direct investments to the country. It’s evident that with more money going towards developing infrastructure, more job opportunities have been created within the industry as well.
Choose the right industry to invest in so your business can flourish.
If you want to run the best startup business in the Philippines, it’s best to get the help of FilePino. Our team of experts can give you the guidance and insight you need to build a successful startup. Get in touch with us today by calling +1.806.553.6552 (USA) or +63.917.892.2337 (Philippines).