Philippines-Japan Collaboration For A Sustainable Partnership

The Philippine Embassy in Tokyo, the Philippine Trade and Investment Center in Tokyo and Nikkei Group Asia hosted the 6th Philippines-Japan Investment Virtual Forum on 01 December 2020. The event was held virtually and had an online business matching opportunity for limited participants.

The theme for this year is “Philippines-Japan Sustainable Partnership after COVID-19 Pandemic – Opportunities for Digital Transformation (DX) and Micro Small and Medium Enterprises (MSME) Collaboration”.

Ambassador Jose C. Laurel V delivering his remarks during the 6th Philippines-Japan Investment Virtual Forum on 01 December 2020.

Ambassador Laurel V stated that Japan is consistently one of the Philippines’ biggest trading partners and export market, and a major source of investment, with last year’s bilateral merchandise trade amounting to USD 21.25 billion.

According to the Japan External Trade Organization (JETRO) in 2017, Japan has around 1,502 companies in the Philippines employing 320,000 Filipinos. 60% of these Japanese companies are export manufacturers and exported about USD 13.3 billion worth of products, which amounted to 26% of the Philippines’ total merchandise exports.

He also cited that during the official visit of President Rodrigo Roa Duterte in May 2019, there were 26 business agreements worth USD 5.5 billion signed by Japanese companies. These projects will result in the generation of 82,737 new jobs in the Philippines.

Trade and Industry Secretary Ramon Lopez informed the participants that, prior to the COVID-19 pandemic, the Philippines boosted economic development fundamentals. The Philippines is the 3rd fastest growing economy in Asia, with a growth of 6.6% in the period of 2016 – 2019 and the 2019 per capita GDP at USD $3,500.

Despite the setbacks and challenges brought about by the pandemic, Secretary Lopez stated that the Philippines still remains a conducive place to do business, as it is considered as one of the top emerging economies and countries for investments. The Economist also ranked the country as the 6th emerging economy with high financial strength. Meanwhile, the CEOWorld Magazine placed the Philippines among the top ten countries to invest in post-COVID era.

Finance Secretary Carlos G. Dominguez III highlighted the Philippine Government’s zero-to-10 point socioeconomic agenda of governance, which aims to enact policies that would both grow the economic pie and share it fairly among Filipinos.

He also discussed the Corporate Recovery and Tax Incentives for Enterprises (CREATE bill), which aims to provide an outright ten percentage points cut, from 30 percent to 20 percent, in corporate income tax rates of domestic corporations with taxable income equivalent to 5 million pesos or about 104 thousand US dollars and below.

ASEAN-Japan Centre Secretary General Masataka Fujita mentioned that Japan is the second largest trade partner in both exports and imports with the Philippine trade with Japan being balanced out (USD $10 billion in both exports and imports).

He said that the Philippines has the potential to strengthen Global Value Chains (GVCs) with both ASEAN countries and non-ASEAN countries.

The continued partnership between the Philippines and Japan will help both countries in the recovery efforts to rise from the COVID-19 pandemic.