Entrepreneurship in the Philippines

Entrepreneurship in the Philippines

• Entrepreneurship is seen as crucial for poverty reduction, improved production, and innovation in the Philippines.
• The 1987 Philippine Constitution recognizes entrepreneurship as a key driver of economic growth.
• Private enterprises are vital for equitable income distribution, sustaining goods & service production, and boosting productivity.

Objectives

• Identify various business models.
• Understand the role of entrepreneurship in the Philippine economy.
• Understand the rules governing businesses in the Philippines.

Enterprise and Competitiveness

• The Philippines Development Plan (PDP) emphasizes trade, investment, and job creation for economic prosperity.
• Measures focusing on macro-economic stability, employment, agribusiness, power sector reform, infrastructure, competition, science and technology, and anti-corruption are pursued.
• Competitiveness is a major focus to enhance the country's function globally.

Rule of Law

• The rule of law encompasses regulatory structures, policy environment, and enforcement of regulations—crucial for assessing Philippine competitiveness.
• The 2013 World Bank Doing Business Survey ranked the Philippines 138th out of 185 economies regarding ease of doing business.
• Procedures for business start-ups—incorporation, and registration—are lengthy and complex in the Philippines, compared to other Southeast Asian nations.

Access to Credit

• Access to finance is a significant challenge for entrepreneurs, especially MSMEs (micro, small, and medium-sized enterprises).
• Obtaining funding frequently involves extensive documentation and collateral requirements—difficult for many MSMEs to meet.
• An enterprise survey (U-ACT, 2008) revealed that access to capital/financing was a major problem, with nearly 72% of respondents experiencing difficulty obtaining capital/investment funds.

Internationalization and Global Production Networks

• Globalization and international market integration have transformed entrepreneurship, requiring adaptation.
• Entrepreneurs need to be capable of seeing opportunities, capitalizing on ideas, organizing resources (capital, knowledge, partners, and management skills) to function and succeed internationally.
• Key areas affecting global competitiveness (defined by WEF) include infrastructure development, labor market efficiency, innovation, readiness, intellectual property protection, and spending on research and development.

Role of Enterprise Networks

• Collaboration among academic, business, and government sectors is crucial in fostering entrepreneurship.
• Enterprise networks (e.g., the Philippine Center for Entrepreneurship [PCE]) play a vital role in developing the entrepreneurial ecosystem.
• These networks aim to create "Go Negosyo communities"—supporting businesses through mentorship, networking, and knowledge sharing.
• PCE's concrete goal is to foster the formation of such communities to help entrepreneurs navigate globalization's challenges.

Nurturing the Entrepreneurship Paradigm

• Entrepreneurship encompasses more than simply economic activity.
• It represents a way of thinking that can empower individuals, create jobs, and enhance quality of life.
• This approach is important to drive economic and social progress.