How Philippine entrepreneurs can profit from the trillion-dollar ‘Belt & Road’

San Miguel beer and Oishi snacks in Belarus? BDO and Metrobank in Bangladesh or Ukraine? PLDT and Emperador in Algeria or Sudan? PAL and Cebu Pacific flying to Sri Lanka’s $13 billion Colombo Port City (now being built by China) or to Eastern Europe?

How can more of our MSME entrepreneurs benefit from the trillion-dollar “Belt & Road” infrastructure plans proposed by China President Xi Jinping to boost free trade? Twenty-nine heads of state like President Rody Duterte, plus heads of the IMF, World Bank, and the UN attended the May 14-15 summit in Beijing.

Six days before the summit, US-educated Chinese Ambassador Zhao Jianhua held a very well-received dinner dialogue with the young Filipino Chinese entrepreneurs of the Anvil Business Club on May 5 at the ballroom of Edsa Shangri-La Hotel to discuss this and other topics.

The new “Silk Road”: The Belt & Road infrastructure investment plans

Sell more to Asia, Europe & Africa

Apart from tapping the world’s biggest and increasingly affluent consumer market of China’s 1.4 billion people, how can we profit from the phenomenon of whole regions opening up to trade and investments via new trains, seaports, highways, better Internet and telecommunications to be built by the Belt & Road plan?

How can we sell more to oil-rich Central Asia, east and central Europe, Africa, Russia, and South Asia, which should become our new markets for Philippine exports, services, tourism, OFWs, etc.?

Europe-educated geopolitics analyst Celso Cainglet said, “Let us not forget that China’s Belt & Road plans can help finance our Philippine infrastructure projects under Dutertenomics, and MSMEs can benefit by providing allied services. The new infrastructures can also finally make inclusive economic growth a reality.”

Global consultancy McKinsey said Belt & Road will involve about 65 percent of the world’s population, one-third of its GDP and can help move a quarter of global trade and services. Xi’s plan has been called “the biggest development push in world history.” 

How can we leverage President Duterte’s reputation as a strong leader and our Philippine economy’s dynamism to overcome our geographic distance from Eurasia and join this Belt & Road plan?

Here are “six golden opportunities” Ambassador Zhao Jianhua cited in the ongoing normalization of the ties between the Philippines and China, though he stressed that there many more opportunities:

1. Better Philippine-China ties to boost trade. Ambassador Zhao said that normalization of bilateral relations between the two countries “has ushered in a new era for bilateral economic partnership and cooperation.” The envoy revealed China has become the Philippines’ No. 1 trading partner, and that 171 out of the world’s 193 countries also count China as their No. 1 trade partner.

He said, “To transform our leaders’ consensus into concrete results, the two countries are working hand in hand to implement a series of cooperation projects in infrastructure, trade and investment, industrial parks, agriculture, tourism, etc. Some are already delivering tangible benefits to our two peoples, including the coming of more Chinese tourists, trade deals and investments. Many more business potentials are waiting to be tapped by talented young entrepreneurs of our two countries.”

2. The Belt & Road Initiative and China’s economic growth offer business opportunities. The envoy said, “Despite a sluggish global economy, China’s economic growth reached 6.7 percent in 2016. With the fundamentals remaining sound and stable, China’s economy is undergoing major changes in terms of development model, economic structure and drivers of growth. In 2013, Chinese President Xi Jinping put forward the “Belt and Road” initiative, “boosting policy coordination, regional connectivity, unimpeded trade, financial integration and people-to-people bonds.”

He said, “So far, over 100 countries and international organizations have responded warmly to the initiative, with the signing of nearly 50 inter-governmental agreements of cooperation. Concrete and targeted projects in infrastructure construction, industrial capacity cooperation and economic zones have been rolled out, creating over 180,000 jobs and spurring economic development in countries along the routes. The establishment of AIIB further injects strong financial support to this initiative.”

3. “Dutertenomics” means synergies for the Philippine and Chinese economies. Ambassador Zhao said, “The launching of Dutertenomics will translate into more synergies between the Chinese and Philippine development plans. Dutertenomics, which includes the administration’s main governance and fiscal policies, comprehensive big-ticket infrastructure programs and upgraded social services — all these schemes are perfectly matching China’s current economic reform and opening up strategies. Our two countries and business sectors in particular can take concrete measures in the above areas to explore future cooperation and expand our mutual interests.”

4. ASEAN’s focus on MSMEs. Zhao said, “Among this year’s ASEAN community-building priorities selected by the Philippines as the rotating ASEAN chairman, there is increased emphasis on ASEAN SMEs as drivers of inclusive and innovative growth in the region, which comprise up to 99 percent of registered businesses and generate a large proportion of total employment in the region.”

He continued, “This will translate into proactive steps for enhancing the ecosystem for micro and SME development and competitiveness to participate in and take advantage of domestic, regional and global market opportunities and increasing access to financing. One example is that during Chinese Vice Premier Wang Yang’s visit to the Philippines last March, more than 670 Filipino and Chinese SMEs participated in a cross-border business matching session and forged deals. This will provide young Filipino entrepreneurs with more opportunities to go beyond the boundary of the Philippines.”

5. ASEAN-China tourism and education cooperation. Ambassador Zhao said, “The ASEAN-China tourism and education cooperation injects new vitality to people-to-people exchanges.” The total number of tourist arrivals from China to ASEAN countries in 2016 reached 19.8 million, representing a year-on-year increase of 6.4 percent, while the number of ASEAN tourists to China recorded 10.34 million, an increase of 57.8  percent.

He added, “With the opening of the 2017 ASEAN-China Year of Tourism Cooperation, two-way personnel exchange would be further boosted. The Philippines will become the particular highlight in this regard. In 2017, the number of Chinese tourists to the Philippines is expected to reach one million, a 70-percent increase over the previous year.

6. Filipino-Chinese entrepreneurs as a special asset and bridge. Zhao said that our unique cultural identity presents enormous opportunities for us to get a deeper understanding of the two cultures, and to serve as links for mutual exchange and cooperation between the Philippines and China in various sectors. “With China’s determination to further pursue integration and common prosperity with the world, and with the improving bilateral ties between our two countries, I am sure that the Filipino-Chinese entrepreneurs will find your unique position in this historic transition.”

The envoy advised us to travel to China more, and also to bring more Chinese friends and business partners to the Philippines. “I hope you could pay more attention to the regional and global dynamics and adopt a paradigm shift, therefore seizing the opportunities out of this rapidly changing world.”

According to Zhao, China attaches importance to the Philippines. “We believe young entrepreneurs will play a bigger role in promoting China-Philippines relations in the future while achieving their own career and life successes.”

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