Biz environment, power rates cause of concern for foreign investors

JAPANESE OFFICIALS cited the Philippine business environment, power rates, infrastructure, and foreign equity limits as continuing concerns for the East Asian investors at a routine meeting between both parties convened under a bilateral free trade deal, the Japanese embassy said in a statement yesterday.

This came as President Benigno S. C. Aquino III prepares for a three-day official working visit to Japan beginning Sept. 25 to meet with the newly elected Japanese Prime Minister Yoshihiko Noda and visit the disaster-stricken Ishinomaki City in Miyagi Prefecture.

The third meeting of the Sub-Committee on the Improvement of Business Environment, chaired by Japanese Ambassador Toshinao Urabe and Trade Undersecretary Adrian S. Cristobal, Jr., reviewed the Japan-Philippines Economic Partnership Agreement (JPEPA) with a view of creating a more favorable investment climate for foreign businesses.

Officials at the meeting represented various local government agencies, the Japanese embassy, and the Philippine arms of the Japan International Cooperation Agency (JICA) and the Japan External Trade Organization (JETRO). The private sector, meanwhile, was represented by Nobuya Ichiki, Japanese Chamber of Commerce and Industry of the Philippines, Inc. president, and Ambassador Donald G. Dee, Philippines Chamber of Commerce and Industry vice-chairman.

“Tax-related issues including VAT (value added tax) refund as well as other issues related to the improvement of [the] business environment, such as the price and demand-and-supply projections of electricity, improvement of logistics including roads, ports and airports, limitation on foreign ownership in certain business sectors and human resource development were… discussed in the meeting,” the statement read.

Nevertheless, foreign officials praised the current administration’s anti-corruption measures, noting transparency, predictability, and consistency are keys to improving business environment and drawing in more investments.

“The Japanese side was very much encouraged by the commitments by the Philippine Government to steadily implement concrete measures for that end,” the statement said.

Both parties will be holding the next sub-committee meeting in March next year. The first and second gatherings, meanwhile, were held in June 2009 and May 2010.

The free trade agreement, which came into force in December 2008, managed to create a smooth and prolific economic partnership despite a global economic slowdown and financial crisis, the review body agreed.

“[T]he recent figures related to trade and investment were very encouraging despite difficult economic situations the two countries had to face during these times,” the embassy said.

Japan remains the biggest investor in the Philippines in terms of activities approved by the Investment Promotion Agency (IPA) with the value of P58.3 billion in 2010, the statement noted.
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By: Eliza J. Diaz
Source: Business World, Sept. 16, 2011
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