STRUCTURE OF THE ECONOMY
Agriculture Products include rice, coconut products, sugar, corn, pork, bananas, pineapple products, aquaculture, mangoes, and eggs. Agriculture here suffers from low productivity, low economies-of-scale, and inadequate infrastructure support. Agricultural output fell in 1997 and 1998 due to an El Niņo-related drought but increased by 6.0% in 1999 (over 1998's low base). Growth reverted to more normal rates in 2000 (4.0%) and 2001 (3.7%). Agricultural output (affected by another, albeit milder, dry spell) expanded by 3.9% year-on-year in 2002 and 3.2% in 2003. Agricultural output increased by 4.9% in real terms during 2004 but stagnated during the first semester of 2005 due to drought and intermittent weather disturbances.
Industrial production is centered on processing and assembly operations of the following items like food, beverages, tobacco, robber products, textiles, clothing and footwear, paints, plywood and veneer, paper and paper products. Heavy industries are dominated by production of cement, glass, industrial chemicals, Fertilisers, iron and steel and refined petroleum products.
The Philippines relies heavily on electronics shipments for about two-thirds of export revenues. Although there has been some improvement, over the years, local value added of electronics exports remains relatively low at about 30%. Overall export receipts expanded by 9.6% in 2004, led by an 11.2% increase in foreign exchange receipts from electronics shipments. Year-on-year export growth slowed to 3.6% during the first half of 2005, with receipts from electronics shipments up by a lethargic 1.2%.
Intel has been in the Philippines for 28 years as major producer of Intel's advanced products including the Pentium IV processor.
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A Texas instruments plant in Baguio has been operating in for 20 years and is the world largest producer of DSP chips in the world. TI's Baguio plant produces 100% of all the chips used in Nokia cell phones and 80% of all chips uses in Ericsson cell phones in the world. Until 2005 Toshiba laptops were produced in Santa Rosa, laguna.presently the Philippine plants focus in the production of HDD's.
Outsourcing industry is growing very fast in Philippines. By the end of 2005, it is expected that a majority of top ten U.S call center firms in U.S will operate in Philippines. Proctor and Gamble has over 400 people in Makati doing back-up office work to their Asian operations including finance, accounting, Human resource and payment processing. To the end of 2005, total jobs in the industry are expected to grow to 100,000 and total revenues are placed at $960 million.
In Mining the country is well endowed with mineral and thermal energy resources. Philippines mineral exports amounted to $650 million in 2000.The industry went on a rebound starting in late 2004 when the Supreme court deemed an important law permitting 100% foreign ownership of Philippines mining companies constitutional.
Trade for the year 2004 shows that there is a deficit in Balance of trade. For the year 2004 total export earnings was $39.6 billion .The important export items are electronic equipment,
Machinery and transport equipments, garments, coconut products, chemicals etc.
Import payments was $ 40.3 billion .The main importable items were raw materials and intermediate goods, capital goods, consumer goods, fuels etc.
External Debt for the year 2003 was $57.96 billion.
Exchange rates of Philippines pesos (p) per US $1 -54.770 until may 2005.
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