Innovation in Philippine transnational corporations: case studies

Abstract

Although Philippine FDI outflows still lag behind some of its ASEAN neighbours, there are an increasing number of Philippine transnational corporations successfully investing abroad. This study focusing on four large indigenous firms provides insights on their international knowledge flows and the factors contributing to their technology strategies and innovation activities. This paper finds that market expansion activities increase learning in firms that extend knowledge and technical assistance from the home office to affiliates in host countries. Firms augment their capabilities and experience through long-term relationships with partners in production networks, in particular with suppliers who provide support for in-house innovation.

Keywords:

• innovation
• Philippines
• transnational corporations
• foreign direct investment outflows
• knowledge transfer

Notes

1 Concessions and management contracts are two modes of port operation. In port concessions, the port owner allows Firm C to infuse capital and build infrastructure including terminals and container handling equipment. Under a management contract, the owner builds the infrastructure and hires the company to manage the facilities.

2 TEU refers to twenty-foot equivalent unit, the volume of a 20-foot metal box used to describe the cargo capacity of a container terminal.