OVERVIEW

Asia remains a vibrant trading hub and a choice investment arena for many international enterprises. Despite the volatile times brought about by threats of terrorism, geo-political issues and an economic slowdown in major western economies, Asia stands in good posture, as it grew an average of 6.5% over the last decade. Perhaps, the richness of her culture that inspired many indigenous and novel products and ideas, fuelled by a fast growing sophisticated consumer population, kept the wheels of her economy turning, retaining its allure as an investment destination particularly for global retailers. At the heart of this trading hub lies the Philippines. Strategically located in South East Asia, it is a natural gateway to the East Asian economies. It is home to 80 million English-speaking, highly literate and avid Filipino consumers whose unparalleled zest for life is undiminished even during the hardest of times. It is no wonder that the Filipinos' choice greeting is Mabuhay!, a wish for "a long and full-life", fitting from a people who find every occasion a cause to celebrate. The impact of domestic consumption to the nation's economy is reflective of the Filipinos' strong propensity to consume. Personal consumption expenditure comprises 70% of the country's GDP. In the past three years, Philippine GDP grew an average of nearly 4% annually, underpinned by a 4% growth in personal consumption. As such, the retail trade sector stands as a direct beneficiary of this pulsating consumerism. Retail trade accounts for about 11% of the domestic economy. For the past three years, it has been the top source of GNP growth at 0.6%, outpacing even growth contributions coming from telecommunications. Total retails space in Metro Manila is currently estimated at 34.7 million square feet and is expected to expand in the near term. Not suprisingly, in an article published in The Philippine Retail Sector Review. the country's retail sector was identified as "one of the fastest-growing industries today". Apart from the Philippines' ideal location as a trading center in the region, its culture and demographics make it a veritable haven for local and international retailers alike.

The Philippines has growing urbane and sophisticated consumer market fascinated by globally-known brands which continues to lure investors with foreign brand names, such as Marks & Spencer, Starbucks, Louis Vuitton and Hard Rock Café. There is steady expansion of private consumption with fast growing population. In Metro Manila alone, there is a potential 3.9 million shoppers who visit the malls at least once a week spending a minimum of 4 hours per visit. The Filipinos' love for food, zest for life and passion for entertainment continues to boost patronage for dining, entertainment and amusement facilities, with consumers making an average visit of two time a week. Filipinos are habitual mall goers with the mall serving as a virtual recreational ground for the entire family. "Malling", after all, is a favorite pastime.

All these make the Philippine retail industry one of the most buoyant sectors and local retailers have been quick to adapt by becoming more responsive to the market's clamorfor novel and superior quality goods and services. Moreover, the recent passage of the Retail Trade Liberalization Act, which eases restrictions on foreign ownership of retail establishments in the country, unleashes even bigger growth opportunities for Philippine retail operations. http://www.ayalamalls.com.ph