7 Biggest Challenges of Doing Business in the Philippines


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The Philippines is globally renowned for its delectable cuisines, historical architecture, and breathtaking scenery. In the last two decades, the country has grown to become an economic powerhouse, with a wealth of opportunities for doing business here.

Strong GDP growth, quality infrastructure development, new markets, government support, and young & talented professionals make it investment-friendly.

7 Biggest Challenges of Doing Business in the Philippines

In this article, we’ll not talk about the perks of doing business in the Philippines, instead biggest challenges you must be aware of:

#1. Starting a Business

The biggest obstacle is launching a business; there are 16 procedures to navigate, which in turn makes it slightly complicated for starting your Business in the Philippines. On average, it takes approx 36 days to launch your company in the Philippines.

The lengthy process of setting up a corporate entity has put the Philippines at 95th spot out of 190 economies for doing business in the World Bank & IFC ranking.

It is a clear-cut indication of how complex the process is. Therefore, it is advisable to reach out to companies like Emerhub that can help you with setting up a company in the Philippines from remote hiring to setting up local operations.

#2. Getting Electricity

Another important yet most overlooked challenge associated with setting up a company in the Philippines is getting an electricity connection. A local power distributor gives an electrical connection; typically, they’ll first inspect the site and then send a team to install the electricity connection.

MERALCO is the biggest power distributor in the Philippines, with control over 22 cities & 89 municipalities. Once the connection has been made, a professional electrical engineer needs to sign the Certificate of Electrical Installation completion as the final obligation. All this process takes time and is often not liked by companies who are in the final phase of launching.

#3. Culture

Business culture can be a big stumbling stone in your pursuit of setting up a successful business in the country.


In the Philippines, most companies have hierarchical structure, and only the senior management of the organization has the rights to take all the major decisions, without inviting any inputs from the different teams.

Filipino clients and business people love to have small personal talks about political issues. So don’t get frustrated in case even an important business meeting takes place as a dinner time conversation. The Philippines love to cultivate strong business relationships based on these small talks.

#4. Enforcing Contracts

Did you know in the Philippines, it takes 842 days to enforce a contract? It involves a total of 37 procedures, and generally, the cases are resolved before the judicial hearing.

#5. Registering Property

Registering property in the Philippines takes around 30 days and the entire endeavor is quite costly compared to other South Asian countries.

There are eight procedures you have to complete before you get the registry of your property.

#6. Paying Off Taxes

In the Philippines, there are a total of 47 taxes to be paid throughout the year, and this approximately consumes 193 productive business hours.

Paying Off Taxes

The employee-paid tax requirements are responsible for the majority of tax payments in the year. The corporate income tax with a flat rate of 30%, and VAT takes the longest time to process the request.

#7. Time

Filipinos have a pretty relaxed approach when it comes to time and the pace at which they do their personal and business works. Deadlines and appointments in the Philippines are flexible rather than definite. Good conversation is way more important than arriving on time.

In the end, these are merely challenges, not the reasons to put your business plans on the back burner. With time, you’ll get accustomed to the culture of Filipinos, and the processing troubles are only a one-time affair.


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