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Metal Casting Technologies : September 2007
(4) The present situation is not conducive to new investments and because the cost of money is high, there is a lack of new capital for modernization. Modernization is crucial to improving productivity, to producing better quality castings at lower costs, and it is a "must" for survival. A pet project of mine that I have been advocating for the past fifteen years -- yes, since 1992 after my consultancy stint with ESCAP in Bangkok -- is the establishment of a Metal Engineering Industry Park, along the model of South Korea where 180 foundries producing machinery, equipment and parts quit their premises in urban areas -- where they were a nuisance and pollutant -- or in run-down industrial complexes and moved to purposely-built estates in the country districts. By clustering together, they realized savings by accessing many common services such as sand reclamation, core-making, heat treatment, and bulk-purchasing of consumables. We could add common service facilities like environmental control equipment, water treatment equipment, and employee services: cafeteria, health services, transport services, etc. -- activities that add to the cost of production, but not to the quality of the product. By operating jointly, the operating costs for such facilities could be brought down to a mere fraction of what they would be if operated alone. And the companies in-cluster could operate in synergy, each producing what it can do best. This is a sure way to overcome the competition brought about by "globalization." Unfortunately, the idea has not made a dent in the minds of our decision-makers. I suspect that our culture may be the crux of the problem as Philippine foundries seem to think that the foundries next door to them are their competitors, and that the limited Philippine domestic market alone is their only market. This was the way it was before jet-travel and electronics shrunk the world. I hope they wake up to the 21st century and realize that today the foundries next door could be their allies, and the foundries in other countries ARE their competitors, and that the whole world IS their market -- the real meaning of "globalization!" The industry has to learn to compete with the world and in the world. Unless it does this, the future does not seem too bright for the industry. Parochial thinking should be discarded -- junked forever! WHO'S WHO OF METALS -- ANNUAL 2007/8 43