september 2014 BCBusiness 31 istock
A S I A
Doing Business in the Philippines
It's a direct flight from Vancouver to the most English-
speaking country in Asia
by Jacob Parry
T
he GDP of the
Philippines—an
island country
of 100 million in
Southeast Asia—
grew at a rapid pace last
year: 7.2 per cent, with
sectors such as business
process outsourcing
(which includes things
like call centres and data
entry for North Ameri-
can companies) growing
at twice that rate. The
young and growing
workforce offers ample
opportunities for Cana-
dian companies, which
exported over $600 mil-
lion worth of goods and
services to the Philip-
pines in 2013.
Get Personal
"Personal relationships
are important," says
Leo Valdes, president
of the Philippines
Canada Trade Council
in Vancouver. "Busi-
ness relationships tend
to be high contact, and
you have to learn at a
personal level about
who you're dealing
with." That means a lot
of small talk: "You'll get
a lot of questions about
your family and where
you live," he says.
"Most people in
North America have a
Filipino friend, so they
understand the hospi-
tality and warmth of the
culture," adds Michael
Stephenson, founder
of PayrollHero, an HR
technology startup with
head offices in Manila
and Whistler, B.C.
Family Ties
Often, however, this
relationship-driven way
of doing business can
obscure who is making
decisions, says Stephen-
son. He points to the co-
nundrum of the "hidden
chairman," where the
most senior family mem-
ber in a Filipino-owned
company (most Filipino
enterprises are privately
held and family-owned)
can have an 11th-hour
veto on major decisions.
"Often the biggest chal-
lenge is identifying who
has final say above the
CEO," he says.
Tricky Business
Indeed, while recent
governments have made
strides tackling graft,
the country ranked 105
out of 179 on Transpar-
ency International's cor-
ruption ranking. Legal
restrictions, regulatory
inconsistency and a lack
of transparency hinder
foreign investment,
according to the U.S.
Commercial Service.
The Philippines is
a developing country
with ports that suffer
from decades of under-
investment. Meanwhile,
Manila's roads and tran-
sit are struggling to meet
the needs of a city of 11
million and growing.
Stephenson says a typi-
cal employee spends 90
to 150 minutes commut-
ing to work each day.
Access to key utilities is
also a challenge.
■
soUrce: bc stats
GROWTH SPURT
Traffic jam in Manila.
top three b.c.
exportS to the
phIlIppIneS In 2013
lumber copper ores
and concretes
poultry
