More digitalization needed to achieve ‘scale’ to compete in global markets

By Luisa Maria Jacinta C. Jocson, Reporter

DIGITALIZATION needs to be expanded further to more areas and more industries to give the Philippines the scale to compete globally, participants at a BusinessWorld Economic Forum panel said on Wednesday.

Mitch Padua, Maya Group chief product officer, said one of those paths to achieving scale is more financial inclusion, which will help drive economic growth.

“It will help build the nation and uplift society. It will bring opportunities and jobs. And at the same time, it will build wealth for our people and our nation,” he added.

“Everyone and everything should be digital right now.  And, when you look at different sectors, be it healthcare, agriculture, government, there are still so many industries that need to be digitalized,” Mr. Padua said.

“Until we’re able to digitize everything, we can’t facilitate global commerce, we can’t really bring that scale down to the global markets,” Mr. Padua said.

“Digitalization is a driving force for greater opportunities and equality. It tends to level the playing field,” Lazada Philippines chief executive officer Carlos Barrera said.

The Philippine Statistics Authority estimates that the digital economy’s share of gross domestic product was 8.4% in 2023.

In terms of gross value added, the digital sector grew 7.7% to P2.05 trillion last year.

“What we really need to do is go to the next level. What we really need to do is to be able to capitalize. A lot of the digital economy right now (involves the) gig economy, provides capability and democratizes things. We need to be able to capitalize on this opportunity,” East West Banking Corp. Chief Executive Officer Jerry Ngo said.

“Filipinos are amazing users of online products and it’s only fair that they also benefit from them. Ten years ago, if you ask anyone, they would hardly have thought of doing business online. It seemed unthinkable,” Mr. Barrera said.

Grab Philippines Country Head Grace Vera Cruz called for a push to bring digital services outside of Metro Manila.

“Over the past years we’ve made significant investments in (going) outside of the National Capital Region and right now it’s becoming a larger part of our business,” she said.

The shift to digital is also now a necessity for businesses post-pandemic.

“All businesses have to go online. So today, there’s pretty much 100% availability of anything,” Mr. Barrera added.

Ms. Vera Cruz also noted that the digital economy should benefit all Filipinos.

“The Philippines is full of digital natives. The question I have is how can we ensure that these digital natives and all of us use technology for the good of everyone,” she said.

“I believe in the Filipino entrepreneurial spirit, that we will work together to solve each problem one by one through digital technology… because of digital technology, no one is left behind. It’s really very important for us to carry one another,” she added.

Google, Temasek Holdings and Bain & Co. said in a report that the Philippines’ digital economy could grow to $150 billion by 2030.