by Jan Michael Carpo, Reporter
Secretary Alfredo E. Pascual of the Department of Trade and Industry (DTI) said in a media interview recently that the Philippines has long been prepared to participate in the Regional Comprehensive Economic Partnership (RCEP) and is now ready to take in more investors to the nation.
The RCEP is considered the largest free trade bloc in the region and usually entails a multilateral trade agreement between and among ASEAN countries, which includes the Philippines, China, Japan, South Korea, Australia and New Zealand. It provides for an open, inclusive, and rules-based trading system in order to promote deeper economic integration in the region.
“We want to ‘Make it Happen in the Philippines,’ and we are prepared,” the trade secretary said. “I think the Philippines has been ready for some time (for RCEP). Our neighboring countries have gotten ahead, and they’re starting to reap the benefits.“
Given the scope of economic activity that the RCEP can bring, the head of the DTI added that there are numerous opportunities that the country can explore for both international and domestic enterprises, particularly in the areas of industrial manufacturing and innovation sectors.
A wide range of prospects for investors
The RCEP is home to China, South Korea, and Japan, as well as to 50% of the world’s manufacturing output, 70% of its electronic items, and 50% of its automobile products.
According to the DTI secretary, “The Philippines now has the necessary foundation to support a robust innovation ecosystem.”
This foundation includes a strong intellectual property regime, the passage of the Philippine Innovation Act and Innovative Startup Act, as well as the creation of various Regional Inclusive Innovation Centers (RIICs) and Innovation & Technology Support Offices (ITSOs) that are now spread out across the nation.
Given the scope of the economy, Pascual said that prospective investors should be made aware that the country has enough room for investments and offers a wide range of prospects. Additionally, he said that the country’s trade and investment strategy is “clear and stable” as a result of its participation in the mega trade agreement and recent significant economic reforms.
“In order to maintain its position as a regional innovation hub, the Philippines must continue to promote more investment in green technologies, energy, logistics, smart agriculture, and information technology,” he added.
Dynamic workforce, strategic location, and clear trade policies
In a press statement, Pascual further emphasized that the Philippines’ expertise in the IT and Business Process Management (IT-BPM) sector makes the country an ideal candidate to earn a position in the region’s burgeoning e-commerce market.
Allan B. Gepty, assistant secretary of the DTI, echoed Pascual’s statement, saying, “This is the reason the thorough sections in the RCEP arrangement on e-commerce, intellectual property and services, including financial services and telecommunications services, are considered as essential foundations to drawing in more expenditures in the country.”
Gepty further revealed that the Philippines’ core competitive edge in the region is also the country’s main “negotiator” at the RCEP — these are the 3Ps or the People, Place, and Policy of the nation. “A dynamic workforce, strategic location, as well as clear trade and investment policies. These characteristics are the core competitive edge of our nation,” he added.
Following “strong” investment approvals obtained in January 2023 alone, Pascual — who also serves as chairman of the Philippine Board of Investments (BOI) — has since revised the agency’s 2023 investment registration target from P1 trillion to P1.5 trillion.
When asked if the country’s ratification of the RCEP had a hand in the modification of the Philippines’ investment registration objective for 2023, the trade secretary stressed that he is confident the massive trade agreement “can contribute to pushing investors to decide to set up shop in the Philippines.”
The trade deal is expected to boost Philippine exports through enhanced market access in the region. It will also provide cheaper goods for production and manufacturing, as well as ensure transparent rules and clear mechanisms for resolving trade issues and concerns. More importantly, it will allow micro, small and medium enterprises to participate in the global value chain.