The Philippines could boost its appeal to foreign investors by capitalizing on its strengths in the services sector rather than competing with manufacturing-heavy economies, according to HSBC.
The country continues to lag behind regional peers in Southeast Asia for foreign direct investment (FDI), ranking sixth last year behind Singapore, Indonesia, Vietnam, Malaysia, and Thailand, according to UNCTAD.
HSBC Asia Economics Associate Director Ines Lam said the Philippines’ limited manufacturing scale restricts its ability to attract global capital. “Everyone wants to get a piece of the global supply chain. Everyone wants to be a supplier to Apple. But for the Philippines, I think the Philippines’ unique value proposition is its people and soft skills,” Lam said at the Management Association of the Philippines’ 23rd International CEO Conference.
Lam highlighted that developing the workforce—particularly English proficiency, educational skills, and technical expertise—is key to expanding services exports such as business process outsourcing (BPO).
“I’m not saying that manufacturing is not important, but because the Philippines has already found its advantage, I think it’s important that the Philippines does not lose this,” Lam added.
“You provide something new and you improve your offerings in terms of BPO and exports of services. Then, that will help the Philippines to stand out in this world.”
