Phl, Korea to boost trade, investment ties

MANILA, Philippines - The Philippines is looking to enhance its cooperation in terms of trade and investments with South Korea to take advantage of the Association of Southeast Asian Nations’ (Asean) move towards economic integration.

Speaking at the Asean-Korea Forum, Foreign Affairs Secretary Albert del Rosario said it is in the interest of the Philippines to pursue a strategic relationship with South Korea.

He said the Philippines sees trade and investments as an area of focus in pursuing stronger ties with South Korea.

“We offer the Philippines as a gateway to Korea’s engagement to Asean,” he said.

He noted that South Korea was among the Philippines’ biggest trading partners last year, accounting for seven percent of total trade.

South Korea was also one of the biggest sources of investments to the Philippines, having poured in P8.5 billion last year with 7.2 percent earmarked for manufacturing.

Park Bun Soon, a professor from Hongik University, said in his presentation in the same event that while economic integration is seen to provide gains for Asean members, there is a need for the Philippines to work with South Korea for it to benefit from such and contribute to the further development of the region.

At present, Park noted that the Philippines is the least benefitting from trade and investment cooperation in the Asean.

The Philippines trade with other countries in the Asean accounts for only 19.1 percent of its total trade, among the lowest in the region.

The Philippines is also the lowest recipient of foreign direct investments among Asean members, with inflows worth $3.86 billion last year.

Given the upcoming Asean Economic Community (AEC), Park said there is a need for the Philippines to make greater effort to raise the efficiency and productivity of the economy in the long-term.

The AEC is seen to allow free flow of goods, services, skilled labor, investments and capital within the region.

“The Philippines should find ways to raise its investment rate in order to expand production capacity and employment generation because the current consumption-led growth is intrinsically difficult to achieve sustainable growth,” Park said.

While South Korea has been more active in making investments in the Philippines, Park said it should continue to disseminate information and encourage its businesses to check opportunities here.

Park said both countries should cooperate to expand the export capacity of the Philippines through greater links between their small and medium enterprises.