Japanese companies remain bullish with Phl operations

MANILA — Japanese companies remain confident with their operations in the Philippines as well as with the country’s economic prospects, the president of the Japan Chamber of Commerce and Industry of the Philippines said yesterday.

Hiroshi Shiraishi said Japanese companies operating in the Philippines are still keen on expanding their operations given the country’s prospects.

"Existing Japanese companies will continue to invest in their factories," the Japanese official said at the second day of the 43rd Philippine Business Conference and Expo held in Manila Thursday.

Shiraishi said that many Japanese companies have positive prospects on the Philippines with the 10-point socio-economic agenda pursued by the current government.

He said among the reasons making the Philippines an attractive investment destination for Japanese firms include its quality labor pool and cheap labor costs, English speaking workforce, government incentives and the country’s robust domestic market.

Shiraishi believes that existing Japanese companies here are very aggressive to expand.

Moreover, he said it is also an opportunity to invite small and medium Japanese enterprises to invest in the Philippines as most big Japanese firms are already in the country.

He said Japanese SMEs have high interest on the Philippines, adding that the country should become more attractive.

"More or less, they will need to have partnership with Philippine companies," he said.

"The interest is growing on the Philippine market," Shiraishi added.

He said Japanese companies need time to be assured that the current government incentives in the country would be continued.

He said they are also optimistic on the government’s tax reform program.

However, the Japan Chamber official urged the Philippine government to open its economy to foreign investors by relaxing the Foreign Investment Negative List (FINL) to create a better business environment.

Earlier, the government vowed to aggressively liberalize the 2017 FINL by opening up more areas of the economy to foreign investors.

Data from the Philippine Statistics Authority showed foreign investments approved by the country’s seven investment promotion agencies fell 54.9 percent in the second quarter to P18.2 billion from P40.4 billion in the same period last year.

For the first semester, total approved foreign investment commitments reached P41 billion, 38.4 percent lower than the P66.6 billion in the same period in 2016.

Furthermore, initial data from the Japan External Trade Organization (JETRO) showed Japan’s direct investment into the country plunged 56.6 percent to $561 million in the first five months of 2017 while Japanese investment in other Southeast Asian countries like Vietnam, Thailand and Singapore had risen double digits in the same period.

The date further showed that in 2016, Japanese investment in the Philippines surged 52.1 percent to $2.31 billion from $1.52 billion in 2015.