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By Katrice R. Jalbuena, Reporter
The Philippines is not attracting as many
Taiwanese companies as other investment destinations in the region,
but Taipei’s new representative in Manila said it will be his top
priority to change that.
“There are big Taiwanese companies that have
investments here in the Philippines, but compared to some other
Asian countries in recent years, the growth has been minimal,”
said Representative Donald C.T. Lee of the Taipei Economic and
Cultural Office in Manila. He was recently a roundtable guest at The
Manila Times.
In Vietnam, for example, the number of Taiwanese
companies increased from 35,000 in January 2007 to about 50,000 this
year, Lee said. “That is a phenomenal growth rate.”
Vietnam has become an increasingly attractive
investment destination for Taiwanese investors, an alternative to
China where the costs of labor and production are becoming
uncompetitive, he explained.
“One of my immediate goals is to have
something similar happen between Taiwan and the Philippines,” he
said.
Referring to Taiwanese companies, he added,
“Let’s try to find a place to replace the PRC [People’s
Republic of China] as their investment countries.”
Concentrated in Subic, Clark
Most of the Taiwanese investments in the
Philippines are clustered around the special economic zones, such as
Subic Bay Freeport in Zambales and Clark Freeport in Pampanga—the
former US military bases in the country.
“The Philippines is attractive to Taiwanese
businesses for several reasons,” Lee said. “In the experiences
of those already located here, [a reason] is the skills of the
[Filipino] workers. There are more skilled, available workers here
than even in other Asian countries, such as Vietnam or Thailand.”
“Another reason is the high English language
proficiency,” he added. “Then there is also the fact that labor
cost is [relatively] low.”
Lee said he hopes to build on the experiences of
Taiwanese companies already in the country and encourage more
investors to come to the Philippines.
There are nearly 80 locators from Taiwan now
operating in Subic, Lee said.
One of the most well-known Taiwanese locators in
Subic is Acer, but Lee said the biggest is Wistron, an electronics
firm that makes integrated circuits and computer parts. The Taipei
official added that another Taiwanese firm, Tong Rong Metal, which
is the second-largest lock maker in the world, is also in Subic.
Taiwanese businessmen have invested about $870
million as of 2007 in Subic, making Taiwan the second- largest
investor there after South Korea.
There are many other Taiwanese companies
operating in other special economic zones across the Philippines.
Incentives work
Taiwanese businesses are attracted to special
economic zones because of the investment incentives, Lee said.
For example, a company that invests at least $25
million can enjoy free rent for the first three to five years of
operations, he added.
And doing business in the Philippines appears to
be paying off. “Reportedly, for the first six months of this year,
the Taiwanese companies in the area have already earned $30
million,” Lee said. “The businesses here are flourishing, and
there is great confidence that they will continue to flourish. They
are very happy in Subic. They are very happy with the Filipino labor
force.”
No threat to OFWs
Lee said the expansion of Taiwanese firms abroad
poses no threat to Filipino workers on the island. He said there is
a new government policy in place that encourages Taiwanese firms to
produce more and export more, and a robust local economy means
plenty of jobs in Taiwan.
Besides, the demand for Filipino workers remains
high in Taiwan, said Wellington Wei, press division director at the
Taipei Economic and Cultural Office. He was with Lee at The Times.
Taiwanese recognize Filipino overseas workers as
“the best,” because they are highly educated and proficient in
English, he said.
Overseas Filipino Workers (OFWs) there enjoy
many privileges, such as a minimum wage equivalent to about P25,000
a month, and a one-day off a week privilege that is not enjoyed by
Filipinos in some other countries.
In Taiwan, the OFWs “know they can make
money,” Wei said, adding that about 10 percent of the OFW
remittances come from Taiwan.
Bilateral relations
Improved investment relations will hopefully
lead to growth in bilateral trade, Representative Lee said.
As of 2007, trade between Taiwan and the
Philippines stood at $5.95 billion, and Taiwan’s investments in
the Philippines totaled $444.86 million, according to data from the
Taipei Economic and Cultural Office.
Philippine exports to Taiwan total $1.8 billion,
while Philippine imports from the island were $4.08 billion. This
makes Taiwan the fourth-largest trading partner of the Philippines,
while this country is the ninth-largest trading partner of the
island.
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