MANILA, Philippines – Taiwan expects better trade and investment ties with the Philippines amid the implementation of its New Southbound Policy.
Kristy Hsu, director of the Chung Hua Institution for Economic Research’s (CHIER) Taiwan ASEAN Studies Center, said that through the policy, they expect to balance the Philippines’ large labor contribution to Taiwan with higher investments.
Hsu said there are around 122,000 Filipino workers in Taiwan, most of whom are in the computer and electronics sector. In addition, over 60% of foreign workers assembling electronic parts in Taiwan are Filipinos.
Aside from contributing to Taiwan’s labor force, the Philippines is also Taiwan’s fourth largest trade partner. However, only 3% of Taiwan’s outbound investments are directed to the Philippines.
Hsu pointed to the country’s population and government, noting that “less democratic governments tend to be more efficient.”
But Hsu said that prior to the implementation of the New Southbound Policy, both countries had cooperated in the areas of “education, human resources, including tourism, and [now] smart agriculture or aqua-agriculture.”
Taiwan launched the New Southbound Policy in 2016 in a bid to lessen its dependence on China. As an alternative, Taiwan is seeking to improve relations with 18 countries, including the Philippines.
Manila Economic and Cultural Office (MECO) Chairman and Resident Representative Angelito Banayo said they have committed to assist Taiwanese firms looking to set up business in the Philippines.
“We want to position the Philippines as the gateway of Taiwan to markets identified in its New Southbound Policy, and as a hub for its global market access strategies,” Banayo added.
In December 2017, MECO and Taiwan Economic Cultural Office signed a bilateral investment protection and promotion agreement to ease the entry of Taiwanese investments into the Philippines.
This resulted in Wistron’s return to Subic in 2018 after moving its operations to China in 2010. Wistron is the computer manufacturing arm of Acer Inc.
Electronics manufacturer New Kinpo Group also announced its intention to set up its Southeast Asian hub in the Philippines, which will increase its current fulltime workforce from 10,000 to 18,000 over the next two years.
The company produces a number of household brands such as Toshiba, Dyson, and Hewlett Packard. – Rappler.com
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