Malaysia sees more economic opportunities in southern Philippines after the signing of the Comprehensive Agreement on Bangsamoro especially in the development of Mindanao’s agricultural sector, specifically oil palm and rubber plantations.
Malaysian Minister of International Trade and Industry Mustapha Muhammed said the agreement opens up doors for Mindanao’s economic growth, with companies from Malaysia eager to invest in the region.
“The investment climate is good especially with the Bangsamoro agreement, which was brokered by Malaysia, as it brings stability in the region,” he said. The Malaysian trade minister was here in the country for the two-day World Economic Forum held last week in the financial district of Makati.
Malaysian companies are noticing the Philippines because of its unprecedented economic growth as well as its huge population, potentially a significant consumer market for Malaysia.
“There have been some discussions on agricultural investments because Mindanao has plenty of land and a huge literate human resource that can help spur development of both countries,” the trade minister said.
Malaysia is interested in developing existing palm oil and rubber plantations as well as downstream manufacturing activities for the two products, he said. The trade minister cited the strong potential of tourism for the sub-regional group Brunei-Indonesia-Malaysia-Philippines East Asia Growth Area (BIMP-EAGA).
Malaysia also offered its expertise to establish Islamic banking and finance in the country especially for the Bangsamoro region.
In August 2011, Petron Corp. bought Exxon Mobil Corp.’s 65-percent stake in Esso Malaysia Berhad for $610 million. Petron’s investment—the single biggest Philippine investment in Malaysia—reached as much as $1.2 billion for upgrading Esso’s oil refinery and renovating some 558 gasoline stations.
Other major Filipino-owned companies operating in Malaysia include Century Motolite Battery Sdn Bhd, URC Snack Foods Sdn. Bhd., Axexorize (M) Sdn. Bhd., BML Excellent Combination Sdn. Bhd. and Pancake House International Malaysia.
On the other hand, foreign direct investment from Malaysia is spread out in construction, finance, real estate, manufacturing, mining, private services, trade and transportation.