As foreign brands enter, support for local retailers urged

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January 2, 2026 | 12:00am

MANILA, Philippines —  The Philippines welcomed the entry of several foreign retail brands last year – from fashion labels to collectible toys and food chains –signaling confidence in the market.

But while their arrival is expected to create jobs, their dominance in the long-term may pose risks to the economy.

As such, retailers and economists believe supporting local brands should be a key part of the country’s economic agenda.

Among the foreign retail brands that debuted in the Philippine market last year were Italian luxury brand Golden Goose, known for distressed sneakers, as well as Los Angeles-based premium athleisure and wellness brand Alo, with both opening stores in Greenbelt 5.

Pop Mart, which sells Labubu and Cry Baby toy blind boxes, unboxed its first permanent store at SM Megamall in December 2025.

The country also saw the return of French patisserie Ladurée, which launched its very first Southeast Asian flagship store in Bonifacio Global City.

With household consumption as the main engine of the economy, it is not surprising that many foreign retail brands are choosing to bet on the Philippines.

Trade Secretary Cristina Roque said many foreign retail brands are interested to enter the country given its big consumer market.

“The growth in retail is really there, whether in the malls or in the e-commerce platform,” she said.

Just last month, Roque met with some South Korean retailers selling food products, leather goods and cosmetics that are interested in doing business in the Philippines.

“The continued influx of major foreign retail brands into the country is largely due to the country’s favorable demographics,” Rizal Commercial Banking Corp. chief economist Michael Ricafort said.

As more foreign brands enter the country, Philippine Retailers Association (PRA) chairman Roberto Claudio said that many others are also inquiring about opportunities in the Philippines.

“This speaks well of the growing retail market in the Philippines,” he said.

However, he said mall operators are giving preference to these foreign brands, resulting in higher rental rates in mall spaces and local brands relegated to less prime locations.

“There is this perception that foreign brands will deliver better sales per (square meter),” Claudio said.

He said the PRA has received complaints from local brands that are being eased out in favor of foreign brands.

“We are seeking the advice of the Philippine Competition Commission if there is a way to promote the interests of both the local and foreign brands operating in the Philippines,” he said.

For now, he said local retailers are working out arrangements with mall operators for equal sharing of prime spaces with foreign retailers.

“We are also seeking support from mall operators to allocate spaces for local SME (small and medium enterprise) retailers for the opportunity to market Philippine-made products  in the better and more orderly environment of various malls in the country,” he said.

Oikonomia Advisory and Research Inc. economist Reinielle Matt Erece said the influx of brands in the Philippine market is an indicator of the country’s strong consumer spending and income growth.

He also said these brands are creating employment opportunities for retail services, as well as administrative work in their local offices and construction.

“I expect that better incomes will result in higher consumer goods demand and can be seen with the continuous expansion of retail spending including foreign brands,” he said.

He said the right policy moves would support the expansion of retail brands.

“However, in the long term, the dominance of foreign brands can make the economy more fragile,” he said.

As foreign brands ultimately bring back their income to their country of origin, he said the Philippines would not be able to directly benefit from the value generated by these businesses.

The dominance of foreign brands in the market would also promote dependence on foreign brands rather than domestic goods.

This could make the country vulnerable to external factors, which are hard to control.

“While the preference for foreign brands is not just an economic question but also a cultural concern, empowering local brands in the age of strong consumer spending should be part of the agenda towards a fast-growing, but resilient economy,” Erece said.