FRESH optimism is surging among investors in the United States about doing business in Asia, particularly in the Philippines, but governments and industries are called to reduce barriers to trade and investment to attract more American investors and keep them for the long haul.
Visiting US Secretary of Commerce Penny Pritzker said in a luncheon speech before Philippine and American businessmen in the financial district of Makati on Wednesday US business groups are seeing “tremendous opportunity for mutually beneficial growth in the Association of Southeast Asian Nations (Asean) region.”
“US businesses can help create shared prosperity and deepen the economic connections that increase opportunity for all,” she said.
Pritzker highlighted the features of the economies that make the region attractive for US investors:
“US businesses want to be part of the solution as countries across the region look to support a growing middle class, develop world-class infrastructure, unleash sustainable energy and invest in their future,” she said.
US economic strategy in Asia
Describing the US strategy for the Asia-Pacific region, she said:
“The US economic engagement strategy in the region has three key pillars: strengthening partnerships with long-established trading partners, helping develop the ‘hard’ and ‘soft’ infrastructure that moves goods and people and building and strengthening regional mechanisms that promote a level playing field for all businesses.”
She emphasized the US’ long-term commitment to strengthening well-established trading partnerships in the region, supporting emerging Asian economies as they develop infrastructure and enter the global trading system, and building and strengthening regional mechanisms such as the Trans-Pacific Partnership (TPP), the Association for Asia-Pacific Economic Cooperation (APEC) and the Asean.
The Philippines is keen to be part of the TPP, which the US sees as the most promising pathway to promoting Asia-Pacific economic integration, and the best way for countries in the region to encourage economic reform and development, increase regional and global competitiveness, and create jobs.
In her Philippine visit, Pritzker is joined by a delegation of US business executives and the US-Asean Business Council, with a clear focus on strengthening the trade relationship between the US and the Philippines, and eventually the Asean region, as well as encouraging even deeper business-to-business ties.
Building on growth momentum
The US Commerce Department took note of the resilience of the Philippine economy as it went through and survived tragic natural disasters and volatile financial markets. Economic growth has been consistent during the last two years and is projected to remain so through 2016.
US commerce officials at a roundtable session with reporters on Wednesday also acknowledged the Philippines’ significant progress in implementing economic policy and institutional reforms and has achieved remarkable improvement in gross domestic product (GDP) growth, competitiveness, intellectual property protection and enforcement, tax revenues, and the country’s sovereign debt ranking.
The US is supporting that effort through the Partnership for Growth (PFG), an enhanced engagement of 15 US government agencies aiming to address the most significant constraints to growth in the Philippines and to stimulate inclusive economic expansion, they said.
USAID and the Millennium Challenge Corporation account for the majority of PFG financial resources amounting to more than $750 million.
US Embassy records released to the media show the US and the Philippines have a strong, $24 billion-a-year trade relationship, and commerce officials said both governments are committed to building on that for mutual benefit.
The US mentioned its recent efforts toward that goal. First, it said, the Philippines was removed from the US Special 301 Watch List “based on significant advances in the protection and enforcement of intellectual property rights,” while the Federal Aviation Administration granted the country a Category 1 rating, paving the way for the country’s airlines to service US routes.
It also cited progress mentioned on worker rights issues in the Philippines, which it said will allow the US government to close a Generalized System of Preferences (GSP) review of worker rights in the country without any change to the Philippines’ GSP trade benefits.
Lastly, it called attention to actions taken to further strengthen and expand bilateral agricultural trade—including positive action on US meat and vegetable exports to the Philippines as well as Philippine fruit exports to the United States—recognizing the sector’s increasing importance to the bilateral relationship.
The US said it will continue to support the Philippine government’s medium- to long-term recovery efforts following Typhoon Haiyan, directed at infrastructure and livelihood development, by working hand in hand with the Presidential Assistant for Rehabilitation and Recovery and local government units. The United States is providing $140 million to support recovery efforts.
Philippine-US relations share extensive people-to-people ties. About 350,000 Americans reside in the Philippines, and about 600,000 US citizens visit the country each year. There are approximately 4 million people of Philippine descent in the US.
In 2013, the US Embassy in Manila processed close to 200,000 non-immigrant visa applications and nearly 65,000 immigrant visa cases.
The Philippines is the second stop of this trip, which began Monday in Vietnam. The trip will wrap up with a final stop in Burma, where Secretary Pritzker will reaffirm US support for the positive political and economic reforms taking place there and meet with civil society leaders, government officials, and the Burmese business community. This is Secretary Pritzker’s third trip to Asia since assuming office almost a year ago.