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We’re attracting Japanese investors|
Late last week, a buzz was created in the Japanese business community by Sumitomo Corporation on the growing attractiveness of the Philippines to Japanese investors. Sumitomo issued a press release that declared “among Asian nations where many Japanese manufactures have invested, the Philippines has been gaining power as an exporting nation…”
Sumitomo cited our “attractive tax incentives as well as rich human resources equipped with English language skill.” Sumitomo went on to say that “in line with this trend, since 2011, the foreign direct investment from Japanese manufacturers to the Philippines has been increasing.”
Thus, Sumitomo announced it has decided to launch an expansion project of an industrial park south of Manila it co-owns with the Lopez Group’s First Philippine Holdings. Sumitomo says it “believes the Philippines will further increase its position as a strategic location for export-oriented industries compared to other Asian nations…”
The Sumitomo press release received wide attention in the Japanese and international press. The Asahi Shimbun reported that Sumitomo “has begun expansion work at the First Philippine Industrial Park in Manila, to add approximately 100 hectares of property for leasing and allow for additional factories to be constructed upon completion.”
The Financial Times, on the other hand, observed that Sumitomo’s move means “a fair amount of this newer investment by Japan Inc is happening at the expense of China, as companies balk at spiraling labor costs after the flare up over a tiny chains of islands in the East China Sea.”
The FT also noted “Japan’s total FDI stock in the Philippines stood at just over $10 billion at the end of 2011, according to government data, more than five times the level of a decade earlier – a rate of growth exceeded only by investment in India (13x), China (8x) and Thailand (6x) over that period, within Asia.”
The fresh interest of Japanese investors in the Philippines is also because of efforts of Manuel M. Lopez, Philippine Ambassador to Japan, to highlight positive developments in the country since the new administration took over. Since he arrived in Tokyo, Mr. Lopez has been constantly meeting with key Japanese industrialists, using his extensive relationships developed from his previous position as Meralco CEO.
Ambassador Lopez e-mailed me from Tokyo his reaction to the Sumitomo story: “Just the fact that the following Japanese companies are going to commence operations this year and at the same time employ thousands of Filipinos is a testimony of what we have been working on… companies such as Murata – chips maker for semiconductor industry… Brother and Canon, both in the printer sector, Bandai – big toy maker, Fuji Optical – makers of optical lenses, Furukawa – maker of wiring harness for automobiles. These are some of the big ones. Uniqlo – the biggest retailer in Japan opened last year in MOA, and is planning 10 new stores in the coming year. There are many smaller ones, and others are about to sign up. Mitsubishi Motors is one. They presented to the President their plans for expansion in the country last week.”
First Philippine Industrial Park (FPIP) which is owned 70 per cent by the Lopez Group and 30 per cent by Sumitomo was established in 1996 in Santo Tomas and Tanauan City in Batangas. It has a total developed land area of about 350 hectares with exports in 2011 of about $1.41 billion.
FPIP has until recently been managed almost from the start by Hector Dimacali. Hector, who is more popularly known as the husband of the owner of the Mary Grace pastry shop chain, nurtured the park’s development through the tough Asian economic crisis and the years during the Arroyo regime when the country’s reputation among foreign investors was at its lowest.
Before he retired last month, Hector presided over the inauguration of the facilities of big locators including Honda, Nestle, Canon, Brother among others. He also successfully negotiated for the expansion of the industrial park by acquiring an adjoining property owned by San Miguel.