Introduction to PHILIPPINES With a population of about 100 million people, the Philippines, which comprises more than 7,000 islands, is the 12th most populous country in the world. An additional 12 million Filipinos live overseas, representing one of the world's largest diasporas. Economic growth in the Philippines averaged a solid 6.3% per year in 2010-2016 and economic transformation efforts have been effective. Macroeconomic fundamentals have improved considerably, inflation has eased to low single digits, the public debt burden has been significantly reduced and external liquidity and solvency indicators have strengthened. President Rodrigo Duterte took office in June 2016 for a six-year term. So far, he has focused on the war on crime, drugs and corruption, opting for drastic methods such as allowing extrajudicial killings of drug dealers and users. Duterte s personality and style of governing represent a potential risk for the country s political and institutional stability. At the same time, the economy continues to grow strongly and the government appears to be willing to maintain fiscal and monetary policy discipline. President Duterte s economic priorities include increased spending on infrastructure and social services as well as tax reforms. This will contribute to fiscal deficit widening but could also help to close the country s infrastructure gaps, combat poverty and elevate its economic growth potential, assuming macroeconomic stability is maintained. Summary BNP Paribas presence BNP Paribas has been present in the Philippines since 1975 with a branch in Manila. The bank offers a broad range of and services to its corporate and institutional clients, including loan syndication, bond underwriting, export finance, project and aviation finance; interest rate, foreign currency and commodity hedging and derivatives; correspondent banking and global trade solutions. Working with BNP Paribas BNP Paribas is a major player in trade finance throughout Asia, including the Philippines, offering a full suite of trade and supply chain financing solutions (receivables purchase programmes, supplier financing etc.), including a unique inventory solution offered through its trade centres in Australia, China, Japan and Singapore, specifically for companies engaged in international trade, as part of a wider network of more than 100 trade centres globally. BNP Paribas has experienced trade finance advisors and personnel who deliver a range of customised trade solutions and advise on local market practices. These solutions are supported by the bank's ISO-certified trade services support team. Currency Currency Philippine Peso (PHP).
Bank accounts Resident / non-resident status A company is considered resident in the Philippines if it is incorporated in the Philippines or is licensed to trade or conduct business there. Bank accounts for resident entities Inside Philippines Outside Philippines Local Currency Permitted without restriction, convertible subject to compliance with foreign exchange transaction rules Not permitted Foreign Currency Permitted, convertible subject to compliance with foreign exchange transaction rules Permitted, convertible subject to compliance with foreign exchange transaction rules Bank accounts for non-resident entities Inside Philippines Outside Philippines Local Currency Permitted, convertible with restrictions Not permitted Foreign Currency Permitted convertible with restrictions Not applicable Payments & Collections Credit transfers Credit transfers are used by companies to pay salaries and suppliers, and to make tax and treasury payments. High-value and urgent PHP-denominated credit transfers are settled on a same-day basis via PhilPaSS. Low-value and non-urgent PHP-denominated credit transfers are processed via the EPCS. USD-denominated credit transfers can be processed on a next working-day basis via the PDDTS. Cross-border transfers can be made via SWIFT and settled through correspondent banks abroad. Two automated clearing houses (ACHs) are planned to launch before the end of 2017. PESO Net and InstaPay will both process electronic retail credit transfers.
Direct debits Direct debits are used for low-value regular payments, such as utility bills. Direct debits are processed on a next working-day basis via the EPCS. Liquidity management Domestic: notional pooling Domestic notional cash pools are not permitted in the Philippines. Domestic: cash concentration Domestic cash concentration structures are available. Cross-border notional pooling Cross-border notional cash pools are not permitted in the Philippines. Cross-border cash concentration Cross-border cash concentration structures are not commonly used due to limit restrictions on cross-border transfers. International trade General trade rules As a member of the Association of Southeast Asian Nations (ASEAN), the Philippines has entered into the ASEAN Trade in Goods Agreement (ATIGA) between member states (Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand and Vietnam). The Philippines is also a member of the ASEAN Free Trade Area (AFTA) and is committed to reducing and eliminating tariffs between members. As a member of the Asia-Pacific Economic Cooperation (APEC) forum, the Philippines has agreed to liberalise trade and investment rules between members. Imports / exports Imports Primary Import sources Electronic China (16.2%) Mineral fuels Machinery and transport equipment Iron and steel Textile fabrics Grains Chemicals Plastics USA (10.8%) Japan (9.6%) Singapore (7%) South Korea (6.5%) Thailand (6.4%) Malaysia (4.7%) Indonesia (4.4%)
Exports Semiconductors and electronic Transport equipment Garments Copper Petroleum Coconut oil Fruit Export markets Japan (21.1%) USA (15%) China (10.9%) Hong Kong (10.6%) Singapore (6.2%) Germany (4.5%) South Korea (4.3%) Import / export volumes 2012 2013 2014 2015 2016 - goods USD m 46,384 44,512 49,824 43,726 43,444 - services USD m 20,439 23,335 25,498 28,167 31,357 - goods USD m 65,310 62,174 67,154 64,975 77,532 - services USD m 14,261 16,320 20,922 23,924 24,232 2.8 4.2 3.8 2.5 0.197 Exports Imports Current account as % GDP Source: IMF, International Financial Statistics, July 2017. Market data updated as of 01-08-2017