Story & photo by Danielle Gabriel
The British Chamber of Commerce of the Philippines (BCCP) said the country will only see a sizable increase in foreign direct investments (FDI) if the country’s business environment progresses into the same level like in some of its Asean neighbors.
BCCP Chairman Cris Nelson said British companies are looking for a reduction in red tape and an improvement in regulations before they start coming in to the country.
“British investors will always look at tax incentives and they will always look at regulations. I think one of the aspects that is part of the 10-point plan of the administration is reducing red tape. Setting up and ease of doing business is something that needs to be focused on. There are many laws layered upon other regulations,” Nelson said.
He added: “I think our take in the context of regulation, ease of doing business and setting up is key focus for companies because they want to be able to establish themselves right. It is not yet felt.”
In June the Philippines ranked 99th out of 190 economies in the World Bank’s international survey on ease of doing business. However, among its neighbors, Singapore ranked second; Malaysia, 23rd; Thailand, 46th; Brunei Darussalam, 72nd; Vietnam, 82nd; and Indonesia, 91st.
Still, even with FDIs falling flat in 2015 at only $5.72 billion, there are encouraging signs as for the first eight months of the year, FDI inflows have already reached $5.41 billion.
According to Nelson, the Philippines is attracting more of the attention largely due to its young population and having the fastest economic growth rate in the region. He added that British companies are looking to partner with Philippine companies in infrastructure.
He said companies that have joined the cross-sector trade mission in October are also expected to push through in establishing partnerships with local counterparts.
These companies are energy supplier Economic Energy UK, ISO certification company International Management Systems Marketing, aviation engine provider Norvic Aero Engines Ltd., information-technology firm PTS Consulting, craft whiskey company R&B Distillers, aromatherapy and skin-care brand Eve Taylor, clothing alteration boutique The Zip Yard and custom furniture company Larimar Furniture.
In the latest International Merchandise Trade Statistics released by the Philippine Statistics Authority, bilateral trade between the UK and the Philippines registered at $484.88 million for the first semester of 2016, the fourth highest among European Union countries. However, trade deficit remains at $23.44 million.
Nelson said, the British government has been boosting efforts to encourage more exporters to do business.
“There is an overall drive for British companies to do export. What we are seeing is the conscious drive by the government to increase exports and trade investments,” Nelson said.
The Duterte administration is looking at improving the ease of doing business in the country by simplifying procedures and cutting on the approvals needed for the establishment of businesses in the country. It is also reviewing the investments negative list and creating a nationwide database.
Image credits: Danielle Gabriel