Philippine Exporters and the Japanese Market: A Micro Perspective on Philippines-Japan Trade

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This article presents data from 1998 to 2002 on Philippine exports to Japan, particularly on market shares and growth rates. I t also provides data on the revealed comparative advantage (RCA) of Philippine export products using 1965, 1975, 1985, 1996, and 1999 data. This article argues that Philippine agricultural, processed food, and consumer manufactures have not been able to fully exploit the potential of the Japanese market due to the inefficiencies of small-and medium-scale enterprises (SMEs), which comprise roughly 90 percent of Philippine exporters. This situation is aggravated by distortionary policies of the Philippine government as well as by insufficient infrastructure and government support. These internal factors make Philippine exporters more vulnerable to stiff competition from China and neighboring Southeast Asian countries, and to the continuing protection and regulation of the Japanese markets.