This can be seen through the total fertility rate (TFR), a demographic indicator that estimates the average number of live children that a woman would have over her childbearing years of age 15-49 based on current birth trends.

To illustrate, estimates by the United Nations put the TFR of the Philippines at 7.42 live births per woman in the 1950-1955 period, higher than the Southeast Asian average of 5.93 live births per woman.

While the Philippines managed to bring down TFR by 58.9% to 3.05 live births per woman in the 2010-2015 period, this is still above the regional average of 2.35 births per woman as other countries saw faster decelerations in their TFRs during those decades.

The Philippine TFR is also above the 2.1 births per woman replacement rate i.e. the rate at which women give birth to babies just enough to sustain population levels (assuming normal boy-girl sex ratio and low levels of mortality). —聽大象传媒 Research / Christine Joyce S. Casta帽eda

Data Source: World Population Prospects: The 2017 Revision (United Nations, Department of Economic and Social Affairs, Population Division 2017)

On a disaggregated basis, how much do the average wages of men and women workers differ? 鈥� via 大象传媒 Research

So far, 2017 was Bitcoin鈥檚 best year. From around $450 per unit in May 2016, it shot up to almost $20,000 in December 鈥� a record-high on account of investors鈥� increased risk-on sentiments. This quick climb led some economists to tag Bitcoin as a bubble waiting to burst similar to tulipmania in the 1630s and the dot-com bubble almost 20 years ago.

Since then, Bitcoin has fallen about 70% from last year鈥檚 peak and below the $10,000 mark amid concerns of increased regulation in developed economies such as South Korea and China. Since then, its price hovered around the $10,000 per unit mark.

This degree of volatility, however, was not the first time Bitcoin鈥檚 stability was put to the test. Like any tech-based platform, Bitcoin exchanges were prone to security breaches with the most prominent being that of Tokyo-based Mt. Gox in 2011. In 2014, Mt. Gox, which at the time held 70% of all bitcoin transactions worldwide, filed for bankruptcy.

In the Philippines, meanwhile, the Bangko Sentral ng Pilipinas (BSP) 鈥� the country鈥檚 monetary authority 鈥� is in the process of approving entities seeking to operate as a Bitcoin exchange after authorizing two 鈥� Betur, Inc. (also known as Coins.ph) and Rebittance, Inc. 鈥� last year, which are considered as remittance companies and thus required to comply with regulations such as rules on anti-money laundering.

Transactions of so-called virtual currencies in the country reached a monthly average of over $8.8 million per month in the first half of 2017 from $2 million and $6 million in the entire 2015 and 2016, respectively, according to Reuters, citing BSP data.

What is Bitcoin?

Born from the wreckage of the 2007-2008 Global Financial Crisis, a hacker (or a group of them — nobody really knows) created the trustless financial medium — the bitcoin.

Bitcoin鈥檚 origins can be traced to 2008 when Satoshi Nakamoto, a pseudonym of an anonymous programmer wrote a whitepaper that year outlining the mathematical theory of a peer-to-peer currency. This materialized a year later into what we know now as the Bitcoin software.

In its early days, it was used only by cryptography geeks with its price next to $0 in 2009. In 2010, the trading of Bitcoin started according to BuyBitcoinWorldwide.com.

There are also other cryptocurrencies as well with those like Ethereum, Litecoin, and Ripple gaining popularity.

They are also open-source, meaning that nobody owns or controls these cryptocurrencies, not even monetary authorities.

While different in value and appeal, they all hinge on one technology 鈥� the blockchain.

The Blockchain

Blockchain is a distributed public ledger where all confirmed transactions (in chronological order) can be verified and being maintained by numerous computers all around the world. It is enforced with cryptography to keep it secure.

鈥淭hat’s really the most important breakthrough to me, when bitcoin arrived,鈥� John Bailon, co-founder and chief executive officer of SCI Ventures, Inc., said in an interview, referring to the blockchain technology. 鈥淚t’s not so much the currency behind it.鈥�

鈥淏lockchain is the best way to record digital transactions of anything not just money, it can be information, it can be land titles, any sort of assets, anything that you need to track in a secure manner, blockchain is the best technology for these,鈥� he added.

SCI is the local company behind bitcoin-related products such as Rebit (remittance service using bitcoins), Bitbit (bitcoin wallet), and Buybitcoin (bitcoin exchange).

Creation

The computers that maintain the blockchain can鈥檛 create one all at the same time. These computers must compete in solving a mathematical problem that takes around 10 minutes to process a block 鈥� a process called 鈥渕ining.鈥�

By design, only 21 million bitcoins will be 鈥渕ined鈥� at some point, making the cryptocurrency deflationary in nature.

SCI鈥檚 Mr. Bailon said that transacting via bitcoin is quick, but it also depends on the volume of transactions that are happening in the network.

鈥淔or example, if you send bitcoin to me right now, it would hit the network within seconds. But the best practice there, if I don’t know you, not that distrust you but I just don’t know you, I need one confirmation. A confirmation takes about 10 minutes. Sometimes it can go an hour depending on the volume of the traffic. Sometimes it happens within seconds,鈥� Mr. Bailon explained.

鈥淭he nature of bitcoin is that there’s always a fee market. Meaning the higher the fee you pay, the quicker your transaction to be confirmed…,鈥� he added.

The Philippines was in the top three of nine countries in terms of meeting needs and expectations in their relationships, according to a study by Prudential Corp. Asia.

The Philippines鈥� average Prudential Relationship Index (PRI) score 鈥� a measure of how satisfied people are with their primary relationships with partners, children, family and friends 鈥� is 79/100 In 2017 against a PRI average score of 71/100 among the nine Asian economies being surveyed.

This means that, on average, people鈥檚 primary relationships fulfill 79% of their desired needs. Compared to its peers, the Philippines is tied with Vietnam at second place, only behind Cambodia (86/100).

Rounding up the nine Asian markets in the survey are the following:

Indonesia (75/100)
Thailand (70/100)
Malaysia (68/100)
Hong Kong (66/100)
Singapore (64/100)
China (54/100)

In terms of average relationship scores that people have with their partners, the Philippines scored 75/100, the third highest in the region and was above the 67/100 average score for the nine countries. Put it another way, those in relationships have approximately 75% of their relationship needs provided for by their partners.

鈥淓xpressions of love are important in some markets in Asia but not others. People in the Philippines, Indonesia and Malaysia are highly likely to value this, but expressions of love are not as influential in relationships in Cambodia or Hong Kong,鈥� the report read.
Also noted in the study is the Filipinos鈥� high preference of making their partners laugh: 鈥淔ilipinos are the most likely to think it important that partners make them laugh (83%) and they are also the most likely in the region to laugh at least once a week with their partners (90%).鈥�

For Shiela May T. Julianda, sociologist at the University of the Philippines: 鈥淔ilipinos are social beings that culturally and naturally are happy people. Compared to other countries, we have a high tolerance to problems.鈥�

The sociologist professor also noted the Filipinos鈥� tendency to 鈥渂eing a collectivist鈥� and being family-oriented that contributed to this high score of relationship satisfaction.

鈥淚f we’re going to base the article’s result on Abraham Maslow’s hierarchy of needs and use the social exchange framework as basis for our explanation, we can say that Filipinos are fulfilled with their relationships because both their physiological needs, safety and security and love and belongingness needs are all met by their loved ones.鈥�

Ms. Julianda hypothesized that the changes in the economic conditions may have played a role: 鈥淲e can say that our economy may be becoming better and that more Filipinos have occupations and that their salaries are higher that they provide their needs…鈥�

On the other hand, she also noted the changing dynamics in relationships given the improving economic conditions and digital literacy: 鈥淸I]f we are going to compare our society today than before, hindi na tayo masyado sa [We are not more into] face-to-face interactions. With all the gadgets and applications found in our mobile phones and the internet, we can already build a relationship with a stranger or a relationship out of convenience.鈥�

鈥淸W]ith the development in our technology and other innovations and influence brought by other countries, nagbago na ito [this has changed]鈥� [S]ome relationships become shallow – one week in love na or one week sila na agad.鈥�

The study also noted that across Asia, technology can be a disruption to relationships with 鈥渟pending too much time on the phone or computer鈥� being the fourth-highest reason for arguments. The Philippines (37%) have the highest recorded proportion among respondents citing this reason as well as saying that mealtimes would be improved if phones were turned off (90%).

Going forward, most of the respondents believe that their relationships will improve in the future.

In Asia, 56% said that their love life will improve within the next five years. Respondents from Indonesia and Philippines were the most optimistic, with 72% or 7 out of 10 saying that they believe their love life will get better in five years鈥� time.

CONSUMPTION has been a strong point of the Philippine economy, as household spending makes up 60% of the country鈥檚 gross domestic product (GDP). With this, many are looking at new frontiers for growth. This next frontier, many say, can be found in electronic commerce (e-commerce).

Forecasts made in a 2014 report by Ken Research Ltd. show the Philippine e-commerce market growing at a compounded annual growth rate (CAGR) of 101.4% from 2013 through 2018. The online retail market is also seen to grow 189.2% during the same period.

A May 2016 report by Google/Temasek said the country鈥檚 e-commerce market is expected to be valued at $9.4 billion by 2025, at a 34% CAGR. In 2015, the e-commerce market was valued at $500 million.

The appeal of e-commerce, which refers to the selling of goods or services by means of exchange through the Internet, is said to be convenience. With a click of a mouse (or a tap on a smartphone), you can obtain the desired good or service without having to worry about shipping costs exceeding the item itself.

Raffy Montemayor, general manager of consumer-to-consumer (C2C) platform OLX Philippines agrees: 鈥淚t鈥檚 definitely the convenience.鈥�

Mr. Montemayor points to cars and real estate, two of the most popular categories sold on OLX: 鈥淏oth usually require on-site inspection, but thanks to listings on our platform with photographs, users save time since they get to see the vehicles or properties through pictures. They eliminate what they don鈥檛 find attractive and then allot time to check in person the listings that they truly like.鈥�

E-Commerce is nothing new in the Philippines. Its advent can be traced back to 2000 when electronic marketplaces were introduced to businesses. At the time, however, local firms were reluctant to use the medium, driven by anxiety over the platform鈥檚 ability to deliver goods and services, the lack of a legal framework and the possibility of e-commerce firms closing shop.

Fear about the last one is not unfounded as recent years saw episodes of e-commerce shop closures (often without much fanfare). Multiply.com, which was initially a social networking site, shut down in 2013. Two years later, logistics firm LBC Express, Inc. shuttered TheShop.ph, its e-commerce platform after only a year of operations. The latest casualties were Ensogo Philippines and Thai-based Ascend Group鈥檚 iTrueMart, both of which closed shop last year.

Notwithstanding these cases, other companies are expanding their reach. Alibaba Group Holding Ltd., the company founded by China鈥檚 richest man Jack Ma, acquired Singapore-based Lazada Group SA, the parent company of Lazada Philippines in April last year, marking Alibaba鈥檚 foray into Southeast Asia and its biggest overseas investment to date. Lazada set up shop in the Philippines in 2012 and has since dominated the local e-commerce space, with an 85% market share.

Another case is the Ayala Group, which earlier this year, acquired a 49% stake in the owner and operator of Zalora Philippines, the country鈥檚 largest online fashion platform. SM Investments Corp. likewise acquired a 30.47% interest in transport solutions provider 2GO Group, Inc.

To accommodate the industry鈥檚 growth, the Department of Trade and Industry (DTI) last Feb. 2016 launched the Philippine e-Commerce Roadmap spanning five years to 2020, covering infrastructure, laws, additional investments, data privacy, consumer education and regional integration. The roadmap aims to support small- and medium-enterprises (SMEs), as only 1% of is said to have a working website according to a 2014 finding of Google鈥檚 Global Index Study. SMEs comprise 99% of the country鈥檚 establishments and employ 62% of the workforce.

The roadmap also aims to bring e-commerce鈥檚 contribution to 25% of GDP by 2020, coming from an estimated 10% share in 2015.

鈥淸The growth of e-commerce here] is private sector-led,鈥� said Janette Toral, founding president of the Philippine Internet Commerce Society and site owner of DigitalFilipino.com, an e-commerce advocacy site.

鈥淲hatever we have right now is all thanks to them. Of course, you have to thank the early players that were not afraid to push the market to rethink on how they do e-commerce. With all the developments happening right now, e-commerce in the Philippines has really started to take-off so I鈥檓 very optimistic about it.鈥�

OF SMARTPHONES AND MILLENNIALS
Besides sound economic fundamentals, e-commerce would also stand to benefit from the Filipinos鈥� technology-savviness, thus the adoption of e-commerce more likely would be a question of when rather than if.

鈥淔irst and foremost, 95.4% of Filipinos access the internet using mobile phones,鈥� said Georgette Tan, senior vice president of communications at MasterCard for the Asia-Pacific region. 鈥淚n the Philippines, those who made a purchase through their mobile phone significantly rose from 34% in 2014 to 53.5% in 2016.鈥�

鈥淢obile banking apps also make it easier to shop and pay for goods online — it is the technology used most often. In comparison, digital wallets, in-browser apps and in-app shopping are significantly lower in terms of usage. However, we see that people are open to using these new mobile technologies in the future,鈥� she added.

Latest data from the International Telecommunication Union point to the number of mobile-cellular subscriptions exceeding the country鈥檚 population at 116 subscriptions for every 100 persons in 2015. The country鈥檚 internet penetration is likewise high at 58%, above the global average of 50% in a January 2017 report by We Are Social and Hootsuite.

Then there鈥檚 the year-on-year increase in internet users, which at 27% is above the global average of 10%. The number of hours spent on the internet per day was tallied at 3 hours and 36 minutes, the eighth highest among the countries surveyed.

Zalora Philippines cofounder and Chief Executive Officer (CEO) Paul Campos III said the Philippines is beginning to catch up with its Asian neighbors: 鈥淚 could even see us overtake some of our neighbors just based on the number of people online.鈥�

Inanc Balci, Lazada Philippines鈥� CEO, said that 60% of Lazada鈥檚 sales are coming from the mobile ecosystem, both iOS and Android.

鈥淭his is a very important trend especially for the Philippines and the rest of Southeast Asia. I鈥檇 say that for emerging markets where GDP per capita is not very high because not everyone can afford a laptop. What we see is that people are leapfrogging the laptop — they become internet users for the first time through their cheap Android mobile phones,鈥� Mr. Balci said.

鈥淭hat opened a huge door for everyone to become internet users and potentially e-commerce users,鈥� he added.

The growing use of digital banking apps by young Filipinos also presents a strong point, according to a report by KPMG R.G. Manabat and think tank Institute for Development and Econometric Analysis, Inc.

鈥淭here are signs of a significant shift in consumer behavior with some seeing internet shopping reaching a tipping point, boosted in part by changing demographics as tech-savvy millennials replace baby-boomers as top consumers,鈥� the report read.

The Philippines boasts of a relatively young population with 31.95% belonging to the 0-14 year old cohort. This figure compares to that of its Asian neighbors whose proportion ranges from 27.6% (Indonesia) to as low as 14% (Korea).

The report also noted that there is an opportunity for businesses to improve their market presence through online and smartphone transactions, with 42% of companies polled saying that consumers prefer to shop online.

The increasing exposure to the digital platforms has made possible the entry of ride-hailing apps like Uber and Grab which have managed to grab sizeable market shares within a few years of establishing a beachhead in the Philippines. Financial technology (FinTech) startups that use the Bitcoin cryptocurrency are also cropping up in the Philippines with their services catering to the internet-savvy and overseas Filipino workers, who regularly send remittances to their families.

COD
While e-commerce was introduced in the Philippines years ago, it was only recently that it started to pick up when companies allowed customers to cash out upon the delivery of their ordered item, to so-called cash-on-delivery (COD) scheme.

This was what made it possible for Lazada to grow its share of the market, a position that the company doesn鈥檛 enjoy in other countries where it also operates.

鈥淭he [introduction of COD] led to a significantly high target base for Lazada. Now, we could easily target anyone who has no internet connection and anyone who knows who has internet connection — and that worked really well. Today鈥檚 significant majority of our orders are coming from COD,鈥� Lazada鈥檚 Mr. Balci said.

With an 85% market share, the company allows its five to six million customers in the Philippines to choose from over 8.4 million available products from big market players to SMEs at any time.

鈥淚t鈥檚 [COD] an amazing thing,鈥� Mr. Balci said. 鈥淚t鈥檚 not really that Filipinos distrust electronic payments, but that electronic payment adoption has been very slow. It鈥檚 not because of the people, it鈥檚 because of the circumstances.鈥�

The COD model thus has become a go-to scheme for other market players. Shopee, a C2C online marketplace, offered free shipping and COD in April last year, a promo that supposedly increased its seller base and product listings by over 40% and 60%, respectively.

It is no surprise that COD would thrive since 99% of financial transactions are paid either in cash or check, according to studies conducted by the public-private group Better Than Cash Alliance. Data from the Bangko Sentral ng Pilipinas (BSP) recorded the country鈥檚 unbanked population and credit card users to be around 70% and 2%, respectively.

鈥淲hen Lazada and Zalora popularized COD a few years back, e-commerce started to grow like crazy because people saw it and thought 鈥業 don鈥檛 have to take that risk and deposit in a bank account first.鈥� They can actually pay for it once it arrives in their doorstep,鈥� said Bjorn R. Pardo, founder and CEO of logistics startup Xend.

鈥淐OD is going to be there for the next 5-10 years. There鈥檚 nothing you can do about it. It鈥檚 great that there are companies like PayMaya and all these kinds of wallets out there, but that is not going to pick up 5-10 years from now. It鈥檚 good that they鈥檙e staking their claim now and they鈥檙e going to be there when it鈥檚 ready, but we鈥檙e not ready for it yet. It鈥檚 cash for now.鈥�

DigitalFilipino鈥檚 Ms. Toral agreed that COD as a payment option offers upsides: 鈥淚n COD, cash is king because when you look at cash, there is only a fixed fee for payments.鈥�

鈥淪upposed in cash payments, there鈥檚 a fixed fee of P25. If the sales payment to be made is P5,000 or P100,000, (the fee) is still P25 unlike in credit cards where it鈥檚 3.5%. So actually, what we need is a more efficient system in processing cash payments.鈥�

Ms. Toral said there is less fraud involved in cash payments due to direct involvement by both the buyer and the seller.

OLX鈥檚 Mr. Montemayor agrees: 鈥淥LX鈥檚 business model as an online classifieds platform supports direct contact between buyers and sellers. Because these transactions happen directly between the two parties outside already of our platform, we highly encourage meetups and COD transactions for the security of both parties鈥� It allows the buyers to inspect the items they鈥檙e buying and the seller gets the payment in full.鈥�

鈥淚t simply eliminates the potential of fraud and there鈥檚 also a chance to back out if they鈥檙e not happy with the transaction,鈥� he said.

CHALLENGES
It鈥檚 not all rosy for the industry, however, as challenges remain in fully realizing its po tential. Two barriers stick out: physical (logistics and payments) and cultural (hesitance to use electronic payments among Filipinos in general.)

鈥淭here鈥檚 this perception that logistics is the dirty part of e-commerce,鈥� Xend鈥檚 Mr. Pardo said. 鈥淲ell, it is. And you know, being in the service business, it鈥檚 hard. It鈥檚 much harder than just playing logistics because now, you鈥檙e dealing with people who are expecting parcels and are excited to receive parcels. At the same time, these might be first time buyers, so that means they are a little apprehensive if the item ordered hasn鈥檛 arrived and they think if they just got scammed.鈥�

Mr. Pardo recounted his early years in the e-commerce logistics business: 鈥淲hen we first started offering domestic shipping, the bottleneck that we saw is that no one was helping the SMEs. If the SME wanted to ship something, they would have to go to the couriers based in malls and literally waste two hours of their day. At the same time, it鈥檚 very expensive. So at that time, we said e-commerce will never grow if it鈥檚 like this. We have got to make it more convenient and affordable.鈥�

Lazada鈥檚 Mr. Balci also faced the same ordeal in the early years of the company鈥檚 operations in the country: 鈥淭he logistics companies back then were doing a fairly okay job in traditional logistics, but e-commerce logistics is really different.鈥�

Mr. Balci would have preferred using third-party firms to service their operations, but that the inadequate services provided by logistics players at the time forced Lazada to create them from scratch. This led to Lazada Express, their in-house logistics firm.

鈥淭he [kind of fulfillment done in e-commerce logistics] was not being done in the Philippines, and the ones who can did not provide good service. So, this makes it difficult for e-commerce companies to provide nationwide service and at the same time, to provide good service overall,鈥� he said.

鈥淚n the beginning, we did it out of survival. Today, we deliver 70% of our orders ourselves in majority of the metro areas even in North and South Luzon, enabling us to deliver faster and cheaper orders and provide better customer experience鈥︹��

Zalora likewise had to build its own delivery fleet. 鈥淚f we were in the US or in China or anywhere else that has a more developed ecosystem, we would not want to build the courier, we would use what the third-party logistics firms already provide,鈥� Mr. Campos said.

Mark Joseph Panganiban, executive director of Digital Commerce Association of the Philppines (DCOM), said the dependence on COD for business transactions is a mixed bag: 鈥淲hat are you going to do if you don鈥檛 do COD? You lose much of your transactions. In the Philippines, 90% of transaction is still COD especially the likes of Lazada and Zalora鈥T]hat鈥檚 good on the part of the customer because they have less risk, they are not that afraid to make a purchase.鈥�

鈥淥n the other hand, it is not necessarily good on the entrepreneur鈥檚 side. Based on logistics figures, I have seen return rates as high as 40%… Regardless of whether the customer accepts the item or not, for the logistics company, the service is already tendered. So, who are they going to charge for the delivery that was just facilitated? Generally, it鈥檚 the seller and it鈥檚 not a good thing.鈥�

Mr. Panganiban said the problem is that Filipinos 鈥渇ear the unknown.鈥�

鈥淚t鈥檚 only until they experience it themselves that they would say 鈥�Ah madali聽pala鈥� (it鈥檚 easy after all). Once they found out that somebody they know uses that, then they will be more comfortable,鈥� he said.

Another factor behind low usage rate is the slow internet connection.
鈥淔rom what I see now, the resistance is less than before.聽Kung may听谤别蝉颈蝉迟补苍肠别听man,听mabagal ang颈苍迟别谤苍别迟听sa lugar nila鈥� So, it鈥檚 not a resistance, it鈥檚 more of a barrier,鈥� DigitalFilipino.com鈥檚 Ms. Toral said.

The average speed of fixed internet connections in the Philippines is said to be around 4.2 megabytes per second, which is below the global average of 6.3.

The whole process that started from the 鈥渃lick-to-buy button to receiving the product in every consumer鈥檚 doorstep鈥� is projected to become a multi-billion peso industry by 2020.

Based on the latest e-commerce roadmap, the government expects the industry to contribute 25% to GDP, a feat that is not difficult to achieve if the 100,000 additional e-commerce businesses could be reached. Enough room for new entrants and aspiring e-commerce entrepreneurs.

While online retail is disrupting its brick-and-mortar counterpart, 54.9% of Filipinos still prefer to look at the physical product in-store, according to a research conducted by MasterCard.

De spite Lazada being the current leader in the industry — not just locally, but also in Southeast Asia — the company encourages SMEs to contribute to the growth and promote more competition to tap the full potential of the e-commerce in the Philippines.

The inflection point of online shopping happened two to three years ago in the country, according to Mr. Balci. This also means that the trend is still young and is on an upward slope, as users of the platform would keep on increasing over the years.

鈥淚 think it has become a part of people鈥檚 lives and what will happen over the next couple of years, more and more millions of people will start using it.鈥�

Department of Trade and Industry Assistant Secretary Arturo P. Boncato, Jr. agrees that the low penetration rate of e-commerce in the Philippines remains a challenge.

鈥淭he amount of our mobile subscribers is considered one of our comparative advantages when it comes to our neighbors. The main challenge here is that we have a low penetration rate when it comes to using e-commerce and for us, it is an indication of the lack of trust. Our challenge then is to make sure that we convert that presence into actually purchasing something using e-commerce,鈥� he said.

Mr. Boncato said Filipinos are accustomed to lining up to pay, adding that even big corporations still pay with their checkbooks for the most part.

鈥淲e can鈥檛 change everybody overnight, but we can start with the digital natives, that is, the millennials, because we can convince them to pay taxes through their mobile phones and they will have no issues about it. But when you ask your parents or grandparents, there is no way that you can c onvince them,鈥� he said.

鈥�Darating din tayo doon聽(We鈥檒l get there),鈥� he added.