21stCentury
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You touched the right point. Manufacturing capability is the most critical part for the discussion. For the three areas that you think Philippines is doing good with: automobile, shipbuilding and rocket/satellitte
1. Automobile:
the 2014 vehicle production volume in Philippines is about 90k units, an extremely small number even compared with other ASEAN peer countries: Thailiand, almost 2 million units; Indonesia, 1.2 million units; Malaysia 600k units.
What's worse is that most of the vehicles produced in Philippines is done via CKD format, i.e. Philippines only does the final assembly work, while most of the parts are imported from other countries. According to IHS, the CKD rate for Philippines 2014 is 91%, or the rate of CBU (Complete Built Up) is only 9%!
Just look at engines: within the 90k vehicles PH produced, 46% of them were using the engines from Thailand, 30% from Japan, 12% comes from Indonesia.
Automobile industry is the best reflection of a country's manufacturing sector. The high dependency on imported parts clearly tells us how bad the manufacturing sector in Philippines is!
2. Shipbuilding
World No.4 sound a great achievement! But the reality of the Global Shipbuilding Industry is that it is almost 100% dominated by China, S. Korea and Japan: China and S. Korea each takes about 40% of the market, Japan owns about 15%. How much do you think could be left for No. 4 to 10 countries??
The good number of the PH shipbuilding industry is contributed by the Japanese or Korean Shipyards in Philippines. The reasons that they come to Philippines is because of:
- PH has high quality coast lines (coast line is almost the most important reason for the location decision of a shipyard)
- PH is close to S. Korea or Japan, hence won't be too expensive for transport the parts to Philippines
- Low labor cost in Philippines.
Similar to the shipbuilding industry, PH also does a pure assembly work in shipbuilding. Almost all major parts of vessels: engines, transmissions, generators, radars, etc. need to be imported. Even the steel sheet are imported. Just look the steel figures of Philippines given by World Steel Org.: Philippines steel production 2013 was 1.3 million tons; while the net import is 4.8 million tons! Import is almost 3 times bigger than domestic production! BTW, PH's reliance on imported steel is very close to Iraq, a country suffered by consecutive war times since 1990. According to World Steel Org. Iraq's net import of steel is 4.5 million tons!
3. Rocket/Satellite
the 1990s' PH Satellite you mentioned should be ABS-3, a satellite made by Loral of US and launched by China in 1997. See? An American satellite plus Chinese rocket!! If I could have 1 billion dollars in the pocket, I could ask for the same package from US and China as well. But does it mean I therefore could make the satellite and rocket on my own? The answer is obviously NO!
See? That's the real situation of the PH manufacturing sector! That's why I don't believe Philippines could keep the grandpa vehicles in a good status. Again, for a task that US or China could handle well, it doesn't mean a country with much poor manufacturing capabilities could also handle the task well.
BTW, to double or even triple the defense spending of Philippines? We all know how bad the corruptions in Philippines, I think the PH generals and their families will be very grateful to your great ideas!
Very informative post indeed!