Taipei, Taiwan—Against a background of robust economic growth and one of the fastest in Southeast in 2013 at 7.2 percent, the Republic of China (Taiwan) recently signed with the Philippines, also rated as Asia’s rising tiger economy, a memorandum of understanding (MOU) on trade and investment, saying the country is “definitely one of the best choices” in the region.
Sun Lih-chyun, Taiwan Executive Yuan spokesman, said in an exclusive interview with the BusinessMirror that the MOU focuses on the exchange of relevant information, mutual conduct of market research, and participation in international trade exhibitions and investment seminars.
Sun said that with Taiwan’s 30 to 40 years of experience in engaging small and medium enterprises, or SMEs, the sector’s contribution to national output are among the things Taiwan can share with the Philippine enterprising sector.
The Philippine government, Sun said, may also be interested in an exchange of information on electronics, machinery, disaster-risk reduction and preparedness, as well as the health-care sector which are some of Taiwan’s strongest points.
Aside from these enterprise areas, Taiwan also sees its manpower sector as one of its strengths; capitalizing on which, according to Sun, will be an advantage to the Philippines because Taiwanese workers, like Filipinos, are versatile. Sun also praised Filipino workers’ quality of labor, adding that the Philippines’s competitive labor conditions and English-speaking citizens are what lure in Taiwanese electronics manufacturing investments.
With Taiwan being the Philippines’s ninth-largest foreign investor, with its total investment reaching $2.106 billion in 2014, there is now a bigger possibility for Taiwanese investors to base component processing in the country and create jobs for Filipinos.
And since Taiwan is the country’s sixth-largest trading partner and ninth-largest export market, Sun said Taiwan would like to push the envelope even further with the signing of a free-trade agreement (FTA) because communication between the two countries is considered “not enough.”
If there will be a formal FTA, Taiwan hopes the Philippine government will lower the tariff, or similar trade barriers, so that trade and future investments would be convenient for the partner countries. “We should get better guarantee, better protection on both sides, [because] the free-trade agreement is a better way to do it,” Sun said.
The recent FTA of Mainland China with South Korea gave Taiwan the reason to reach out to some 30 countries, including the Philippines, and expand its international economic and security relations.
“[When] South Korea signed an FTA with China, that stroke us quite heavily and [that is why] we believe we should [fast-track establishing relations with other] countries, especially in the Asia-Pacific region, and [we think] the Philippines is a good [diplomatic partner].”
“The most important [thing] in economic development is that productivity will increase. We have increased our productivity in the past years and we did very well. However, we still need a fair ground to compete with other countries,” Sun said. “For Taiwan and the Philippines, we don’t have those kinds of problems because the style of development and our products are different,” Sun said.
The Philippines will host the 2015 Asia-Pacific Economic Cooperation (Apec) summit and the country’s priorities—building human resources, preparing for natural disasters and improving health care—are all strongest points of Taiwan. Sun said that, “given the solid foundation and friendship between the Philippines and Taiwan, we believe it is a good timing for us to go further and have a future [development] agreement because [a good economic relation] is going to be beneficial to both [countries].”
“We believe the Philippines can support us in becoming a part of the regional economic development support groups. And, for the Apec summit next year, we believe we have a lot [of things] to contribute to the Philippines and other countries,” he added.
As Taiwan is open to strengthening ties with the Philippines, the country is hopeful of signing a bilateral economic cooperation agreement with the Philippines because, Sun said, “we are not competitors, we complement each other.”