Changes in Lowest bidder rule Trade Secretary Ramon Lopez has offered some recommendations to the next administration to ensure the sustained growth of the manufacturing sector, which in the past six years attracted P1.1 trillion infusions, of which of $4.3 billion are foreign direct investments (FDIs).
At the Manufacturing Summit yesterday, Lopez said the next administration could consider introducing refinements to the “lowest bidder rule” in government procurement to spur demand for locally manufactured goods.
“We all know local manufacturing would create jobs here and not abroad,” he said.
Lopez was referring to a provision in Republic Act 1984 which awards contracts based on the lowest bid.
“This is a policy we want to inject post pandemic… to have preference on locally- manufactured products…to make sure in certain products, there will be preference for locally-manufactured provided supply is available and prices are competitive.”
Lopez said the prices can be benchmarked from those abroad to make sure the costs are within range.
Lopez said in a related government program, the National Employment Recovery Strategy, agencies passed a resolution where for some special government procurement, only local companies can participate in the bid.
He said local manufacturers of personal protective equipment (PPE) for example can serve future requirements once the country has enough manufacturing capacity.
Selected government procurement such as uniforms, boots and other gear for the military can also be bought from local suppliers.
To illustrate manufacturing’s role in job creation, Lopez said employment in the sector stood at 3.4 million in 2016 and 3.65 million employees by 2019. Despite the decline in 2020 to 3.19 million, employment immediately recovered in the next two years that by April 2022, employment stood at 3.66 million which has already slightly surpassed 2019.
Lopez ended his presentation to list other recommendations for the next administration to consider.
One is to align future Strategic Investment Priorities Plan with the Inclusion Innovation Industrial Strategy to grow innovative and globally competitive manufacturing, agriculture and services industries.
Lopez said the next administration should consider allocating government budget to accelerate digital transformation towards an inclusive and sustainable industrial development.
To prepare the workforce for the jobs of the future, the next administration could
implement a Human Resource Development and Industry Skills Framework, according to Lopez.
Another recommendation calls for continue support to the development and scaling up of innovative startups and micro, small and enterprises.
Leveraging on the recent FDI liberalization, Lopez sees the need to expand and diversify trade and investment sources and upgrade industries’ participation in the global value chain. Irma Isip
