THE Philippines and Mexico have discussed new ways to further improve trade and investment cooperation, and avoid incidents of double taxation, the Department of Finance (DoF) said.
A recent meeting between Finance Secretary Carlos Dominguez 3rd and Mexican Ambassador to Manila Julio Camarena Villaseñor focused on Mexico’s concerns regarding a pending concurrence by the Philippine Senate in the agreement on double taxation, which also includes an exchange of information on tax matters between the two countries to combat tax evasion.
“Our portfolio in the Philippines is getting bigger and bigger. This agreement is very important,” the Mexican ambassador said.
They discussed Mexico’s proposal to do away with triangulation of the exchange rate between the Philippine peso and Mexican peso, which means the two currencies are traded in the foreign exchange market without having to go through the US dollar conversion process, the DoF said in a statement Friday.
Dominguez agreed with Mexico’s proposal on scrapping the exchange rate triangulation.
Camarena was with Coca-Cola FEMSA President Fabricio Ponce. Coca-Cola FEMSA is the largest franchise bottler of Coca-Cola products in the world, and in the beer industry as second largest stockholder in Heineken.
Other Mexican companies like cement and building materials manufacturer Cemex and the appliance company Mabe also have substantial investments in the Philippines.
“The investments of Mexico has reached the $6 billion figure in the Philippines,” Camarena said.
Dominguez intends to immediately take up the double taxation issue with the Senate, which has yet to concur in the agreement. “We will make sure that we’ll follow it through (with the Senate),” Dominguez assured the ambassador.
The agreement on double taxation avoidance covering income tax and prevention of tax evasion was signed in 2015. But Philippine Senate has yet to concur in the accord, according to the DoF.
Camarena said he is “looking forward to discussions” on Mexico’s proposals to improve bilateral trade and investments with Trade Secretary Ramon Lopez and officials of the Bangko Sentral ng Pilipinas.
Commercial relations between the Philippines and Mexico date back 400 years, with the Manila-Acapulco Galleon Trade in 1565 paving the way for a two-way exchange of goods between the two countries.
In his meeting last October with Trade Secretary Lopez, Camarena said Mexico invests more in the Philippines than it does in other East Asian countries, and expressed Mexico’s interest in making Manila its economic gateway to Southeast Asia.