Focused on the Philippines
Bank of China says that its focus on SME cross-border trade and investment will be in the country
Following President Rodrigo Duterte’s state visit to China last month, the Bank of China has decided to focus its SME cross-border trade and investment efforts in the Philippines
IN 2017, Bank of China Ltd.’s (BOC) focus on small and medium enterprises (SME) cross-border trade and investment will solely be with the Philippines, bank officials said yesterday.
BOC officials are inviting Filipino SMEs to take advantage of the “rekindled partnership” between China and the Philippines by participating in the upcoming conference slated in March next year in Manila.
Deng Jun, the country director of BOC-Philippines, said this initiative is meant to help connect more Filipino SMEs to the global supply chain and link them with their counterparts in China and the rest of BOC clients in the world.
The SME cross-border trade and investment conference is an offshoot of President Rodrigo Duterte’s visit to China last October, where the two countries signed a two-year strategic cooperation agreement to boost mutual trade and investment.
The BOC, the Department of Trade and Industry (DTI), the Philippine Chamber of Commerce and Industries (PCCI) and the International Chamber of Commerce (ICC) Philippines were the parties involved in the agreement.
Targeting small businesses
BOC pledged a $3-billion financing facility for SME cooperation and for industrial and infrastructure projects that will aid in the Philippines’ development efforts.
BOC launched the 2017 SME crossborder trade and investment conference through a roadshow in Cebu yesterday attended by the Cebu business community. The bank will re-echo the same roadshow in Manila today.
In the Philippines, SMEs comprise 99.6 percent of all registered businesses and employ 70 percent of the total workforce.
DTI Trade Services Officer John Paul Iñigo, said main challenges of Filipino SMEs include limited access to capital, technology and markets. He said the government hopes to address this longstanding concern of the sector by linking them to financial institutions like BOC, which would link them to potential partners in China and its clients worldwide.
BOC’s global SME cross-border matchmaking service overturns the traditional mode for attracting investments by adopting a six-step process, including establishing a database for Chinese and foreign enterprises, customer matching, remote online matchmaking, one-to-one meeting, onsite inspection and all-around banking service.
Jesus Varela, director general of ICCPhilippines, encouraged the local chambers to provide a the list of SME participants for the conference. BOC, on the other hand, will also provide a directory of their clients for the initial matching.
Welcome news
Business leaders in Cebu lauded this initiative by both countries, citing there truly is a need for intervention to uplift the SME sector.
“This is a great opportunity for our local SMEs to have global matchmaking access and avail of business linkages in China,” said Melanie Ng, president of Cebu Chamber of Commerce and Industry (CCCI), adding that the conference will provide an impetus for more trade opportunities and encourage growth of SMEs who will avail of the cross border matchmaking service being offered by BOC.
Ng also said this roadshow is aligned with the plans of CCCI to establish more links and create more opportunities for their members and SMEs in Cebu.
She cited her participation as a busi- ness delegate during President Duterte’s state visit to Beijing, China, the chamber’s initial meeting with Chinese Consul General Shi Yong and his economic team two weeks ago and CCCI’s strong interest in participating in this upcoming conference as some of the initiatives the chamber has done so far following the country’s pivot to China.
Wider market
Glenn Anthony Soco, president of Mandaue Chamber of Commerce and Industry, sees the initiative as an avenue that will not only bring in capital investments and loans to spur growth of MSMEs, but also open new and wider markets for MSME products, especially to China.
He noted that MCCI will play an active role, especially in match-making and participant generation.
In the past two years, the BOC has held 26 cross-border investment and trade conferences in the world, which attracted over 30,000 people from political and business circles and more than 8,500 enterprises from 57 countries in five continents to participate.
It covered high-end manufacturing, environmental protection, information technology, medical and health, agriculture, food, machinery and equipment, chemical, automobile and other industries.
Nearly 5,000 cooperation intentions were reached in over 9,500 one-to-one ne- gotiations. At least 1,000 cooperation intentions have yielded substantial results.
BOC is a 100-year-old financial institution. It has a commercial banking license in the Philippines and has been in operations in Manila since 2002.
Data from the Philippine Statistics Authority revealed that the Philippines incurred a trade gap of $5.9 billion with China from January to August this year, while it enjoyed a $1.2 billion trade surplus with the United States in the same period.
Records from the Bangko Sentral ng Pilipinas, likewise, show that net US foreign direct investments (FDI) in the Philippines stood at $78.28 billion from January to July 2016 while net FDI from China was at $3.30 million.