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E-commerce seen to contribute P1.2 trillion to PHL economy by 2022

The e-commerce sector could contribute P1.2 trillion to the economy by 2022, representing 5.5% of the gross domestic product (GDP), according to the government’s new e-commerce roadmap.

This projection is double the 2020 baseline of P599 billion, or 3.4% of the GDP, Trade Secretary Ramon M. Lopez said at the online launch on Friday. The department also plans to double the number of e-commerce businesses.

“We hope to increase the number of e-commerce enterprises from 500,000 in 2020 to 750,000 by 2021 and one million by 2022,” he said.

To develop the roadmap, the department had conducted focus group discussions attended by organizations in the payment, logistics, platform, and government sectors.

The new roadmap updates the 2016-2022 version, which had aimed for the industry to make up 25% of the GDP by 2020, from 10% in 2015. The previous roadmap had targeted 100,000 micro, small, and medium sized enterprises to venture into e-commerce.

The Trade department said in a press conference that the methodologies used for the new targets have changed after refining definitions on what counts as e-commerce.

The 2022 roadmap has four key factors, including making e-commerce easy and quick, improving ease of doing business to improve market access, digitalizing businesses, and reducing logistics costs.

The increase in e-commerce use during the lockdown amid the coronavirus disease 2019 (COVID-19) pandemic last year, Mr. Lopez said, also resulted in an increase in consumer complaints. Consumers had turned to online shopping as health restrictions and public health anxiety lowered mall foot traffic.

The total number of complaints reached 15,967 for the year, Mr. Lopez said.

“For e-commerce to succeed, the government and private sector must install redress mechanisms that are far more efficient than what we have today,” he said.

“But we must also instill values and ethics in our citizens—both merchants and consumers alike—to serve as the foundation of trust in our country’s e-commerce.”

The Philippine Retailers Association had said that the sector’s sales are likely to remain around 20-30% below pre-pandemic levels this year as consumers continue to stay home and scale back spending.

Business name registrations with the Trade department in 2020 grew by its largest margin in a decade, reaching about 900,000 by mid-December, or 41% higher than the previous year.

Online retailer registrations jumped to 88,000 by the end of 2020 from around 1,700 in between January to March.

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