The Filipino Shoe Industry

Topics: International trade, Metro Manila, World Trade Organization Pages: 3 (1007 words) Published: April 14, 2013
The Filipino Shoe Industry

The shoe industry in the Philippines is modest in size, is made up largely of very small units of production with low levels of capitalization, pays meager wages, even by local standards, and is characterized by much informalization of employment structures. The industry is strongly concentrated in geographic terms. The National Capital Region, which includes Marikina City, is by far the dominant center of the industry with 39.3 percent of all establishments and 53 percent of all employment.

From the 1950s to the 1980s, the Philippine shoe industry experienced a boom owing from strong local and international demand. During these years, many Filipinos wore locally-made shoes such as the Ang Tibay and Mabuhay brands, and carried locally-made leather handbags and purses. These products were also exported to foreign markets or ordered by local Chinese distributors for marketing in the provinces. At the end of the 1970s and the beginning of the 1980s, the industry was even able to capitalize on a passing fashion trend in the United States, and it experienced a short-lived bonanza in exporting snake-skin shoes to New York and other large American cities. With the liberalization of the Filipino economy and the rising tide of competition from Chinese manufacturers, the Marikina shoe industry is now in the throes of a major crisis, with no end in sight.

Until the 1980s, the shoe industry in the Philippines was protected by the high tariff barriers then in force as part of the overall national policy of import substitution. The industry accordingly prospered in a modest but definite way on the basis of its more or less complete command of domestic markets. In the 1980s, import substitution policies were largely abandoned by the Philippine government, and over the 1990s trade liberalization accelerated greatly.

Since the 1990s, footwear groups in Marikina and other areas have been warning against the influx of cheap goods from China,...
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