Predictability ‘essential’

Predictability ‘essential’


""Japanese businesses remain interested in going to the Philippines and other ASEAN (Association of Southeast Asian Nations) countries," Minister of Economy, Trade and Industry Yukio Edano told visiting Southeast Asian journalists last Thursday.


"With Manila and Tokyo gearing up for a review of the Japan-Philippines Economic Partnership Agreement (JPEPA) later this year, Mr. Edano said, "Enhancing predictability within the borders of your country is very important -- in terms of trade and investment rules and regulations..."


""The big companies, they have legal and international affairs departments to help them sift through various investment regimes, but for SMEs (small- and medium-scale enterprises) who are now very interested in the Philippines and other ASEAN countries, it is different ... so predictability of regulations and other business conditions has to be enhanced ... these have to be very clear."
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"Mr. Edano, who was appointed to his post in September last year after a stint as chief government spokesman, said the predictability of regulations was also a key concern for Japan with regard to the Trans-Pacific Partnership (TPP) initiative, a broader trade pact proposal that Tokyo has formally asked to join.


"The TPP, aimed at liberalizing trade and investment among participants, has seen rising interest among major Asia-Pacific economies.


"The group now consists of Australia, Brunei Darussalam, Chile, Malaysia, New Zealand, Peru, Singapore, Vietnam and the United States. Broad outlines of the pact were set last November and an agreement could be finalized this year.


'The Philippines has also expressed its interest in the US-backed deal but has yet to seek an invitation. Daunting preconditions, including the need to revise laws that impose restrictions on investments, have been seen as hurdles.
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"Data provided by the Japan External Trade Organization (JETRO) to the visiting Southeast Asian journalists last Thursday showed that while direct investments in the Philippines nearly doubled to $1.02 billion last year from $514 million in 2010, the flows were still the smallest among six ASEAN countries. Thailand received the biggest share at $7,133 billion; Singapore got $4.491 billion; Indonesia, $3.610 billion; Vietnam, $1.858 billion; and Malaysia, $1.438 billion.
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"JETRO’s "Survey of Japanese-affiliated firms in Asia and Oceania", conducted from Aug. 1-Sept. 15 last year, showed the top five "business problems" of Japanese firms in Philippines as comprising forex volatility (55.4%), local procurement difficulties (54.7%), staff abilities (50.9%), wage hikes (48.4%) and an increase in procurement costs (46.7%).


"In the same JETRO briefing, however, Takayuki Nagashima, director general of the organization’s Overseas Research Department, noted that increasing inquiries on the Philippines indicated that "investments should rise.""