The Philippines is now the “it” country for investments in Asia. After becoming the second fastest growing economy in the world next only to economic giant China, all eyes are now on the Philippines as an investment haven.
Rommel Juan, president of the Electric Vehicle Association of the Philippines (EVAP), said that with the unfavorable interest rates now being experienced by Japan, it is more beneficial for Japanese businessmen to invest their money in a business rather than to keep it in a bank. “They have thus put the Philippines on top of their list for possible investments ahead of Thailand and Vietnam. And the electric vehicle [EV] industry is one sunrise industry they have set their eyes on,” he said.
Juan revealed that Japanese EV companies Bemac, Prozza Hirose, and GMS have all set up shop in the Philippines. “Taiwanese conglomerate TECO has partnered with Ropali and has set up Roteco to locally assemble electric jeepneys and tricycles,” he said.
Juan added that the Philippines now has the perfect environment for investment in the EV industry and he cites the following reasons, among others.
Huge domestic population
The Philippines now has a population of over 100 million people with the bulk in the productive working age of 22 years old. This means that there is a large consumer base that can be tapped to use electric vehicle transport systems that will be set in place.
Inefficient public transport
The country probably has the most backward transport industry with inefficient public utility service anchored on buses, jeepneys and tricycles with drivers picking up and dropping off passengers anywhere they please. And these vehicles are mostly dilapidated, antiquated smoke-belching jeepneys and tricycles with an average age of over 15 years.
Electric vehicles are the perfect alternative to replace these old vehicles as they offer an eco-friendly, quiet and comfortable ride. And with the new EVs, the government and private sector can implement proper driver discipline and implement designated stops for these public transport vehicles.
Huge population of public transport vehicles to be replaced
There are 370,000 registered public utility jeepneys and 1.2 million registered tricycles. It can be assumed that there are a lot more unregistered ones or colorums. This is a huge market in a country where there was a record total auto industry sales of 310,000 units for 2015. The EV sector can focus on the domestic market and then go for export to neighboring countries making the Philippines the EV manufacturing hub for Asia.
The Board of Investments is always open to assist foreign investors if they want to enter the Philippine market. Fiscal and non-fiscal incentives are now being proposed through legislation for EV players.
Local companies ready for foreign tie-ups
There are many local companies who have facilities for local EV production complete with all the government requirements. They are EVAP members and foreign companies may just choose from any of them. Thus, foreign investors need not worry about entering the market by themselves.
Juan concluded that with all these factors in mind, the Philippines is on the perfect sweet spot for EV investments. “EVAP will highlight the different domestic EV companies and their products in the upcoming Philippine EV Summit at the Meralco Multipurpose Hall on April 14-15, 2016. We invite all foreign players to come and have a look-see at the various opportunities available in the local EV industry. Finding a local partner would be a good way to jumpstart their entry and EVAP members would be more than willing to discuss business prospects with them,” he added.