By Marinel Peroy
With innovative solutions and mobility, Grab Philippines positions itself at the forefront of economically contributing within the transportation sector. This has been proven through a study conducted by UA&P’s Center for Research and Communications titled, ‘The Impact of Ride-Hailing and On-Demand Delivery Services on the Philippine Economy: A Focus on Grab Philippines’ discussed at an official media briefing on March 12.
According to the study, Grab PH plays a pivotal role in creating job opportunities, driving economic growth, and significantly contributing to the national GDP. It is found that Grab has reinforced its key contributions from 2019-2021 through the following: a 3.42 economic multiplier for every peso spent on the Grab platform; 0.44 household income multiplier (with Grab PH ranking as the 3rd among the seven transport sectors listed by the PSA); and the 1.6% reduction rate in average number of unemployed people.
In addition to this, Grab PH provides a daily average income of about 6x the minimum wage. UA&P Professor for School of Manager and Lead, Prof. Gregorio Mabbagu, highlighted that the superapp serves as a “lucrative income generating platform.” Mabaggu noted that “technology really enhances economic growth and development”, whereas it has been shown through Grab Philippines’ vital role in its study on ride-hailing and on-demand services.
Consumer patronage of Grab services accounts for 0.07 to 0.3 percent of the national GDP, proving that from 2019 to 2021, Grab’s estimated total economic contribution ranges from P37 to P165.6 billion.
As expressed by Dr. Cid L. Terosa, UA&P Associate Professor, Senior Economist, and Input-Output Analysis Specialist: “Our study shows that Grab – with its strong foothold in the Philippines, its technology, portfolio of services, and a robust ecosystem of partners and merchants, has a remarkable capacity to propel our economy forward. Having the unique position as a superapp has allowed Grab to fully realize a multiplier effect that reverberates throughout the economy and the Filipino household.”
Mobilizing from safety to transparency
Grab Philippines can be expected to improve their innovative ways of catering to the needs of their consumers – be it developing a customer-centric approach and offering more valuable services.
Dr. Thomas Aquino, Senior Fellow at the UA&P-CRC commented on a study that “Grab will continue to be key economic drivers as they transform the lives of many Filipinos for the better.” Dr. Aquino also explained the key role of ‘safety, reliability, and timeliness’ while also commending the positive impact of online marketplaces promoting a more balanced regional development.
However, he highlighted the necessity of the ‘awareness of policy makers’ of this ride-hailing and on-demand delivery services – with several recommendations such as: 1) having a specific category of the sector, 2) being technically described, and to 3) publicizing the information not only through the help of media but also other sectors like fintech. Aquino also mentioned the necessity of working with the appropriate government regulatory agencies before legislation.
“Safety is something that the government has to provide for — through agencies, practices, announcements,” stated Aquino.
Speaking with THEPHILBIZNEWS, Dr. Aquino shared that “digital platforms are a great help” in addressing regulatory concerns. Aquino also mentioned the necessity of working with the appropriate government regulatory agencies before legislation. In addition, he emphasized that Grab has its competitive edge among competitors within the ASEAN region; whereas, a regulatory framework is much needed to foster necessary revisions and changes from policymakers.
“Metro Manila is not enough – we have to meet most islands in the country where economic activity will thrive,” added Aquino, expecting that other ASEAN countries are doing the same as business enterprises.
Grab Phl’s mission-driven approach
Grab PH Grace Vera Cruz shared they are “eager and prepared to help usher in a new phase of inclusive growth and inclusivity – with the support of our partners in the government, and public sector, and our regulators”, particularly in being an active partner of the government to growth and development agenda.
Vera Cruz also emphasized that Grab will continue to leverage the “technology and market leadership… to create a transformative impact in their lives and build a stronger, more resilient digital-first economy for generations to come.”
Grab Philippines reaffirmed its dedication to driving economic growth through its operations, which currently spans over 100 cities nationwide. As part of its ongoing commitment to innovation, it aims to further drive digital transformation with everyday services to additional cities and municipalities beyond Metro Manila in 2024.
