PH, Russia identify key investment, trade areas

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Philippines and Russia said they have identified key areas of economic and trade cooperation that they can strengthen ahead of President Rodrigo Duterte’s official visit to Moscow on May 25.

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In a forum hosted Friday by the Management Association of the Philippines, Socioeconomic Planning Secretary Ernesto Pernia said the possibilities for expanding Philippine-Russia economic and trade relations were in the areas of exports of food and other products; increase in tourist arrivals from Moscow and deployment of Filipino workers to Russia.

Pernia also cited waste management, aircraft engines manufacturing, grains supply, fuel and gas supply, pharmaceuticals, construction materials and metals supply as other areas of cooperation.

Providing an overview of the Philippine-Russian economic and trade relations in his presentation, Pernia said Philippine exports to Moscow grew 1.4 percent in the first nine months of 2016 on the back of significant growth in components, semiconductors, and electronic data processing. That showed a turnaround from declines registered in previous years.

Total imports, on the other hand, shrank by nearly 50 percent due to the lower import value of crude and petroleum, as well as other crude materials, he added.

“It is a very minimal level [exports and imports]and so the room for expansion is immense and that is why we need to stimulate the interest, not only of the Filipinos, but also Russians, to engage in interactive trade and investment relations. I think the time for that is right,” he said.

In terms of tourist arrivals, Pernia said visitors from Russia slightly recovered in 2016 after registering declines in 2014 and 2015.

“Arrivals peaked in 2013 but that [segment]has not been performing better since then,” he said, noting that Russian’s share in total tourist arrivals in the Philippines was only 0.47 percent in 2016, providing a vast room for improvement.

Remittances from Filipinos in Russia grew more than 11-fold in a span of three years from 2012 to 2015. However, they declined by a slight 2.2 percent in 2016 to just below $50 million.

With these areas of opportunity open, the Philippines’ robust and high economic growth, low inflation and ample money supply provide good reason for the country to expand its relations with Russia further, Pernia added.

Russian Ambassador to the Philippines Igor Anatolyevich Khovaev emphasized that the political environment in his country has become much more favorable, allowing it to enhance its bilateral relations with the Philippines.

The areas of cooperation where he sees the two countries could strengthen their ties are in politics, trade and investments, security and defense, science and technology, education and culture, and tourism, energy, transport infrastructure, among others.

“It is really a chance that should not be missed,” he said.

In particullar, Khovaev said Russia has a wide array of oil and gas projects, which account for 25 percent of its gross domestic product.

“The energy sector of Russia is focused now on the Asia-Pacific region,” he said.

“Another major sector is transportation infrastructure. Russia is a transportation superpower, especially that we have a highly developed network of railways. So Russian companies are ready to come into the Philippines and be engaged in railways projects,” he added.

Khovaev also stressed that the economic and trade sanctions on Russia by other developed economies have forced it to diversify its economy and find new domestic drivers of growth, new economic partners in different regions of the world.

“Russian businesses are actively penetrating regional markets and in this respect, we consider the Philippines as a major promising partner of Russia in the Asia-Pacific region,” he said.

“We are interested in building a long-term and reliable partnership between Russia and the Philippines. The partnership will contribute to the development of both our nations and also to regional peace, stability and sustainable development. We have no hidden agenda,” he added.

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