The Philippines have defeated all odds and will make a remarkable recovery in 2015 despite the impact of natural disasters over the past few years. Economic growth is back on track, with public-private programs that will help boost the growth of the private sector, and big events happening this year will fuel the growth for security.
This year will be a positive year for the Philippines, with a forecast GDP growth of 6.8 percent, fueled by inflow of foreign direct investment and remittances. Impacted by a string of natural disasters in the past two years, including Typhoon Haiyan in 2013, the strongest typhoon to ever hit land, the Philippines still managed to achieve a 5.3 GDP growth last year. According to BDO UniBank, the biggest likely change for 2015 will be accelerated implementation of infrastructure projects under the government's public-private partnership (PPP) scheme. Moreover, as the world's largest center for business process outsourcing (BPO), opportunities will present itself with more demand for security and protection for data and employees who work at unruly hours.
Uncertainty for 2016 Elections
Presidential elections will be held in 2016, which may lead to postponement of some projects. Some investors may delay key decisions till a new government is formed and wait to gauge what the future policy environment will be before launching major projects. At the same time, nearing the upcoming election, talk of more projects and activities from the government to gain more votes will hopefully turn into real projects, as growth initiatives must continue. According to Rosalie Real, Project Manager of CBR2 Marketing, “Some agencies will hurry up and purchase before elections, while others who are either indecisive or have no final requirement yet will have to wait after the election is over to continue their projects.”
According to Matthias Boehm, Country Manager of Bosch Security Systems, the elections are considered to be “hot months” in security and safety; most projects are still being rolled out, while some are put on hold.
Security Growth Benefits From Economy
The Philippines has recently been named one of the fastest growing economies in Southeast Asia, and the security industry has benefitted from this trend. “The security industry matures almost every day. As we integrate electronics to this field, the security industry then takes a bigger leap, which opens up many possibilities for surveillance, access control, finger prints, face detection, voice recognition, and building management systems (BMS), etc. If we look at it on a general basis, growth for the industry doubles every year,” said Zel A. Ortiz, Sales and MD of Alcon Philippines Technologies and Solutions.
2015 is a busy year for the country, with events that will be sure to fuel the growth of security. The Asia-Pacific Economic Corporation (APEC) Summit will be held in Manila this year, which the country will appoint a large amount of the budget to security, as it is a main concern. “We are preparing for important visits in 2015, particularly for the APEC summit, for which reason our airports are already in the process of renovation. Entertainment facilities such as casinos and resorts are also in progress in several parts of the country, but predominantly in Manila,” said Boehm.
Also this month, Pope Francis will visit the Philippines to give blessing to the country that suffered from Typhoon Haiyan, which will urge the country to be more aware of security, and take extra precautions by upgrading their current systems at crowd drawing events during the Pope's visit. The Pope's decision to ride in an open vehicle instead of a bulletproof, enclosed "popemobile" poses as a security challenge, and the country has issued additional security forces to ensure protection, including additional soldiers and maritime security surveillance.
“No CCTV, No Permit” Fuels Growth
The policy “no CCTV, no business permit” implemented in 2014, is an essential driver for the security industry, especially surveillance growth and security awareness. With law enforced to mandate surveillance systems as part of business owners' security measures, the public will soon realize the importance of monitoring their premises that can not only deter criminal activity, but also catch culprits.
The policy is implemented in most of the major cities in the Philippines, requiring new and existing businesses to install surveillance systems on their premises in order to obtain business permits. Establishments such as banks, shopping malls, service stations, super markets, money changers, 24-hour convenience stores, schools, fast food restaurants, car dealerships, and other crime-vulnerable establishments such as jewelry and pawnshops, hotels, game and amusement establishments, and health clubs are under the ordinance to install surveillance cameras in order to continue their businesses. “The new legislations implemented by local government units all over the Philippines have definitely placed importance on security, particularly in the use of surveillance systems as a preventive measure against crime. It is now a matter of strictly implementing this policy that will define the standard for surveillance with help of video surveillance manufacturers. This way, more options will be made available to SMBs and will then spur growth in the sector,” Boehm explained.
“No CCTV, no business permit” has set the standard for surveillance systems as the policy has specified a range of requirements for surveillance placement of cameras inside and outside of the establishment, hardware requirements that are needed to record incidents and clearly identify culprits, as well as suitable storage memory that can store the footage for forensic evidence. “The policy will push surveillance growth because it can greatly reduce petty crimes in SMB sectors like supermarkets, convenient stores, etc., and at the same time it helps to contribute security in the public,” said Ortiz. Moreover, in order to push the growth of surveillance in the Philippines, education is essential to allow consumers to know what is appropriate for their requirements. “We manufacturers have to keep educating SMB customers what will be their benefit when they deploy security surveillance systems, or they will simply install no-use cameras just to meet regulation, which is not beneficial at all,” Masami Eguchi, GM of APAC at Panasonic System Communications stressed.
As growth for surveillance is fueled by the policy, business owners have started to realize the importance of video surveillance for their establishment. “Since the government issued a video surveillance requirement, most business owners at first resolve to buy cheap surveillance products just for compliance. Later on as they experience the importance and what good quality products could bring, they are adapting to change. IP cameras and HD-over-coaxial products are fast becoming popular. Consumers learn by asking about resolutions, clarity, and infrared for night viewing. The Philippine government offices, schools, private businesses will surely evolve to upgrading their system these coming years,” said Real.
Private Sector Takes the Lead
Recently, growth in the private sector has been booming with the help of PPP projects. As a result of the government's agenda in the development and implementation in infrastructure, project demand is high. “Mid-high projects have been stronger driven from the commercial sector, e.g., hospitality and gaming that needs security in their operations, which are verticals driving the security industry in the Philippines. It will continue in 2015 with commercial projects from the private sector driving forward,” said Sunny Kong, Director of Sales in APAC at Milestone Systems.
According to Eguchi, though the current market size in the Philippines is still small, it has extremely high growth. “Panasonic would like to contribute to the commercial sector, such as retail stores, and banking,” he added.
Projects to Improve Tourism 2015 is “Visit the Philippines” year, a campaign designated to bring in more tourism to the country, with a target to reach 10 million tourist arrivals. To promote this, there is a need to improve facilities for airports, hotels, residential, commercial, and entertainment establishments that will help bring in more tourists within the year, which will also further boost the security market. According to Tamir Ginat, Senior VP for APAC at IndigoVision, some of the big projects going on that will boost tourism in the Philippines are casinos, smart city projects, the Philippines international airport, and the Philippines light rail transit (LRT).
According to Ivan Tjahjadi, Country Manager of ASEAN at Axis Communications, “To date, the highest growth for us is manufacturing, transport and commercial projects. These industries now require more security and intelligence in their system. Integration also is a big factor since most of them have old systems running.”
Residential Boom
In recent years, various verticals have been growing, especially the residential sector which continues on its cycle of boom as a result of rising demand, capital growth, and rental yield. Developers are committed to addressing the problem on housing shortage. Lately, the trend now is to build mix-use township projects in order to house various types of establishments.
“In all these constructions, security will definitely have a big part to play in ensuring the safety of the general public,” said Boehm.
All Eyes on Philippines
All eyes are on the Philippines as it continues to grow at an optimistic pace, with the help of the BPO industry and government spending for PPP. Additionally, the “no CCTV, no business permit” policy will be a crucial factor that can help the security industry in the Philippines to grow awareness and promote growth. The Philippines will see a prosperous year as it goes on the fast track to success.