Econmet Paper
CHAPTER 1
INTRODUCTION
A. Background of the Study
The Philippine Food Manufacturing Industry is said to be the most dominant and dynamic industry in our country today, having an approximate contribution of 20 percent in our Gross Domestic Product annually. The 2004 Philippine Bureau of Food and Drugs’ Statistical Report of Establishments listed a total of 11,601 food processing establishments nationwide. The food manufacturing has ten subsectors, namely: Bakery products, Coconut products, Milk and Dairy products, Grain Mill Products, Processed Meat and Fish, Processed Fruits and Vegetables, Milled and Refined sugar, Vegetables/Animal Oils and fats, and Animal Feeds and Miscellaneous food. Although the food manufacturing has linkages with the agricultural sector, it involves the processing of agricultural products into final stage for consumption (Abanto, 1998).
The major players of the said industry include San Miguel Corporation, RFM Corporation, Universal Robina Corporation, Liwayway Marketing Corporation, and Southeast Asia Food, Inc. (Quianzon, 2008). Despite the growth and performance of this industry locally, it has not yet reached its maximum potential. Compared to other countries in Asia, the Philippine Food Manufacturing Industry is seen as relatively small. Hence, the researchers believed that the industry has a lot more to offer.
Competitiveness, on this matter, can be associated with the food manufacturing industry. The term competitiveness has been defined in various ways by different literatures. Nonetheless, a definition of competitiveness that is more focused and related to manufacturing sector is that “competitiveness in industrial activities means developing relative efficiency along with sustainable growth.” (Lall, 2001) It was also defined as “the sustained ability to profitability gain and maintain market share” by the Canada’s Agricultural Food Competitiveness Task Force. (Martin et al., 1991; Fischer
INTRODUCTION
A. Background of the Study
The Philippine Food Manufacturing Industry is said to be the most dominant and dynamic industry in our country today, having an approximate contribution of 20 percent in our Gross Domestic Product annually. The 2004 Philippine Bureau of Food and Drugs’ Statistical Report of Establishments listed a total of 11,601 food processing establishments nationwide. The food manufacturing has ten subsectors, namely: Bakery products, Coconut products, Milk and Dairy products, Grain Mill Products, Processed Meat and Fish, Processed Fruits and Vegetables, Milled and Refined sugar, Vegetables/Animal Oils and fats, and Animal Feeds and Miscellaneous food. Although the food manufacturing has linkages with the agricultural sector, it involves the processing of agricultural products into final stage for consumption (Abanto, 1998).
The major players of the said industry include San Miguel Corporation, RFM Corporation, Universal Robina Corporation, Liwayway Marketing Corporation, and Southeast Asia Food, Inc. (Quianzon, 2008). Despite the growth and performance of this industry locally, it has not yet reached its maximum potential. Compared to other countries in Asia, the Philippine Food Manufacturing Industry is seen as relatively small. Hence, the researchers believed that the industry has a lot more to offer.
Competitiveness, on this matter, can be associated with the food manufacturing industry. The term competitiveness has been defined in various ways by different literatures. Nonetheless, a definition of competitiveness that is more focused and related to manufacturing sector is that “competitiveness in industrial activities means developing relative efficiency along with sustainable growth.” (Lall, 2001) It was also defined as “the sustained ability to profitability gain and maintain market share” by the Canada’s Agricultural Food Competitiveness Task Force. (Martin et al., 1991; Fischer