A creeping Chinese ‘invasion’

EYES WIDE OPEN - Iris Gonzales - The Philippine Star

In my mind’s eye, the modern day Trojan Horse is filled with Chinese and even taller than the 25 feet wooden horse which successfully invaded the ancient city of Troy.

In reality though, there’s no war and there’s no ancient city to conquer.

But there is China and the rest of the world for its expansion. China’s Trojan Horse is galloping across a modern day version of the ancient Silk Road, dubbed as China’s One Belt One Road.

The Philippines isn’t spared and if you look around, there is now a Chinese invasion of sorts happening in the country — from infrastructure, telecommunications, property, and now, the gaming industry.

In Greek mythology, the Greeks used a giant wooden horse and hid a select force of men inside to enter the city of Troy after a fruitless 10-year war against the Trojans. That night, the men crept out of the horse and opened the gates for the rest of the Greek army to come in. Caught off guard, the Trojans were helpless as the Greeks destroyed the city of Troy and successfully ended the war.

The ancient tale isn’t exactly the perfect metaphor for China’s aggressive expansion in the Philippines. It might also be an exaggeration to say there is a creeping Chinese invasion in the country, but the imagery is on point.

Clearly, the Philippines is seeing an aggressive expansion of Chinese businesses because of China’s One Belt One Road policy and President Duterte’s pivot to China.

We’re seeing this expansion across various industries – from offshore gaming, to property, to telecommunications, and now to a multi-million dollar casino in Boracay.

Beijing must be ecstatic.

Offshore gaming

When the Duterte administration introduced the Philippine Offshore Gaming Operations or POGO landscape in 2016, Chinese gaming companies flocked to the country.

There are now 53 offshore gaming licensees and a lot are Chinese companies.


And because of the influx of offshore gaming companies, the property sector was caught by surprise.

Demand for both office and residential space has grown by leaps and bounds, making up for the slowdown in the traditional business process outsourcing (BPO) industry.

Property giants have changed their plans, building offices for POGOs instead of the traditional office clients.

They have started to raise prices, too, taking advantage of the surge in demand from Chinese buyers who are in the Philippines now because of the growing POGO industry.

They are mostly Chinese employees working in POGO companies.

Over dinner recently, DMCI Holdings chairman and president Sid Consunji said they are indeed seeing a shift in buyers of DMCI Homes.

Mainland Chinese buyers now account for more than half of the company’s overseas sales in the first quarter of the year. Overseas sales comprise half of the buyers of DMCI Homes.

But they are taking steps to limit the acquisition of Chinese buyers because they may end up having absentee residents similar to Shanghai and Beijing wherein the buildings are totally sold out, but no one is living in the building.

“It’s our objective to sell to the end users — preferably the local end user,” he said.

The growth is, indeed, phenomenal.

Last year, online gaming accounted for 223,902 square meters of office space from just 56,000 sqm in 2016, according to property consultant David Leechiu.

Cruise ships

The Chinese have also filled the cruise ships docking in our shores. Indeed, the tourism sector is enjoying an influx of Chinese arrivals.

In the first two months of the year, 256,880 Chinese tourists visited the Philippines, making China “the most improved market at an impressive 56.44 percent growth rate,” the tourism department said.

Junket players

And because of the warmer relations between Manila and Beijing, the country’s casinos are also enjoying big bets from Chinese gamblers.

Hello, China

Those vying to become the country’s third telco player are also Chinese companies – China Telecom, China Mobile and North Telecommunications. They are in talks with potential Filipino partners.

Galaxy casino

As if all these expansion isn’t enough, Chinese casino giant Galaxy Entertainment Group has just been issued a license to build a $550 million casino resort in Boracay.

One Belt One Road

The “One Belt and One Road” strategy of the Chinese government is obviously working. It is envisioned to be an economic corridor that will be a modern version of the Silk Road, established during the Han dynasty for the lucrative trade of China’s famous silk.

The Philippines isn’t really part of the route, but is clearly a target of Chinese businesses for their expansion.

No Chinese invasion but...

The expansion is happening fast. But some local property companies are saying that some local government units are not very comfortable with the influx of huge Chinese population in their areas, citing a host of social problems such as excessive drinking and gambling.

Indeed, the growing Chinese presence here may be a double-edged sword. While I have no doubt that more businesses in the country would translate to more jobs for Filipinos, I hope the benefits far outweigh the disadvantages.

I hope the Chinese companies won’t displace or gobble up our local companies. I also hope there won’t be any tweaking of laws – especially in utilities – just to favor foreign companies including Chinese firms.

It’s okay to roll out the red carpet, but let’s also be cautious. After all, it remains to be seen whether China will turn out to be a cuddly white panda or a fire-spewing dragon.

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