The Philippine petrochemicals industry aims, In the short- to medium-term, to secure and provide the vital resin requirements of the entire country in a competitive, efficient and timely manner so as to catalyze sustainable and dynamic manufacturing activities fueling growth across all user-industries. In the medium- to long-term, it seeks to harness the tremendous potential of the entire petrochemical streams (over 2,000 industrial/chemical products), which should provide a formidable backbone for Philippine industrialization.
The industry's objective is to achieve self-sufficiency in strategic resin supply and increase the petrochemical sector’s contribution to total Philippine GDP from Php 44 B in 2010 to Php 113 B in 2018 and Php 215 B by 2025 through the progressive integration of upstream, midstream and downstream components of the sector. Such progressive integration will involve the entry into various other petrochemical branches that will provide exponential value addition in different industries, spurring domestic and export growth and potentially contributing up to 5-10% of GDP by 2025.
Towards this, the industry recommends the enforcement of anti-smuggling measures to eradicate substandard and illegal petrochemical products in the local market, implementation of reforms to ease doing business, and update the industry masterplan to rationalize location and and logistical network of upstream-midstream-downstream facilities in a closely-linked value chain.
Petrochemicals is a strategic sector of the economy that could anchor the country’s industrial development. Because of its strong linkages upstream, midstream and downstream, the sector provides robust multiplier effects on other main sectors of the economy such as construction, electronics and computer, medical services, transportation and automotive, packaging, education, telecommunications, electrical and water distribution, agriculture and fishery, and furniture, among others.
The petrochemicals industry centers around the production of plastic resins, which is used as inputs to the downstream plastics industry to form different products. The total petrochemical investment in the country is estimated to exceed US$ 2 Billion pesos with 895,000 metric tons per year total capacity in polymer production. Total domestic capacity for resins presently exceed local demand but remain unutilized due to intense competition from imports, the absence of domestic monomer production, and intermittent supply constraints for feedstock or monomer.
There are currently seven operating firms in the industry, employing more than 1,200 employees directly and around 1,800 workers indirectly. With the addition of upstream projects under construction and expansion plans, direct and indirect employment is estimated to reach more than 5,000 by 2014.
The establishment of the Philippine’s first naphtha cracker facility by JG Summit Olefins Corp. (JGSOC) is expected to provide the first step for upstream integration of the petrochemicals industry. It provides a powerful means to actualize the potential of developing various downstream operations that would broaden the petrochemicals industry product range and deepen its primary product offerings in the country. With the growing demand for resins from both the domestic and international markets, the promising outlook for the domestic economy, and the government initiatives to boost the manufacturing sector, investments in the petrochemicals industry can be expected to expand further.
The main industry association in the petrochemicals sector is the Association of Petrochemical Manufacturers of the Philippines, Inc. (APMP). It is a member of the Federation of Philippine Industries (FPI) and the Philippine Chamber of Commerce and Industry (PCCI).
Petrochemicals Industry Performance (in MT)
|Less: Resin Exports||10,032||49,157||99,391||117,819||58,529|
|Net Compounded Local Sales||721,222||596,667||607,870||618,065||617,915|
|Average Price/MT in US $||1,329||1,470||1,060||1,433||1,426|
|Average Forex Price Php:US$||46.15||44.47||47.64||45.08||43.31|
|Est. Local Sales Value, in billion Php||44.23||39.00||30.70||39.93||38.16|
|* Local production is used using monomer inputs. Monomer import data is based on figures reported by RP.|
|** Resin import data based on figures reported by exporting countries|
The manufacture of chemicals is among the preferred activities in the IPP. This includes the production of petrochemicals and its derivatives, including, but are not limited to, the manufacture of derivatives from ethylene such as ethylene dichloride (EDC) and vinyl chloride monomer (VCM); olefins and polyolefins [Polyethylene (PE), Polypropylene (PP), Polystyrene (PS), and Polyvinyl Chloride (PVC)], derivatives from propylene, derivatives from mixed C4, and aromatic derivatives.
The certification of petrochemicals products is guided by the Philippine Standard (PS) Quality and/or Safety Certification Mark Scheme.
The Technical Working Group (TWG) for the Chemicals Industry Cluster – which includes petrochemicals – serves as the coordinating mechanism through which industry concerns are addressed. The TWG is organized into four action tasks, namely:
Among the TWGs activities are the following:
Unit 1405 Cityland 10 Tower 1,
156 H.V. dela Costa St., 1227 Makati
Tel. No.: (632) 753-4189
Email: [email protected]
Industry and Investments Building,
385 Senator Gil Puyat Ave,
Makati City Philippines
Tel. No.: (632) 890-9329
Email: [email protected]