A ‘new dawn’ in Philippines-US economic ties

BABE’S EYE VIEW FROM WASHINGTON D.C. - Ambassador B. Romualdez - The Philippine Star

As instructed by the President, we prepared a fully jam-packed schedule for him during his six-day working visit to the United States. He had countless meetings and dialogues with business executives of top American companies, as well as forums/roundtable discussions with organizations that include the US-ASEAN Business Council, the US Chamber of Commerce, Asia Society and the World Bank Group.

The meetings covered key sectors that include digital infrastructure, business process management, information technology, aviation, security, agriculture and energy as well as climate change and disaster response. The discussion with global food corporation Cargill for instance centered on boosting agricultural productivity and how the Philippines can attain food security and self-sufficiency. The dialogue with NuScale Power – whose groundbreaking proprietary technology in designing advanced nuclear small modular reactors has made it an industry leader – was very informative as it delved on clean energy and the potential of nuclear in lowering electricity costs and mitigating climate change. Other companies that met with the president include Boeing, WasteFuel and Procter & Gamble.

A key engagement was the Philippine Economic Briefing, and joining the president were members of his economic and infrastructure teams that include Finance Secretary Ben Diokno, BSP Governor Felipe Medalla, Trade Secretary Alfredo Pascual, NEDA chief Arsenio Balisacan, Budget Secretary Amenah Pangandaman, Transportation Secretary Jimmy Bautista, Tourism Secretary Christina Frasco, Public Works and Highways Secretary Manuel Bonoan and Information and Communications Technology Secretary Ivan John Uy.

Among the big names that composed the business delegation that joined the president in New York are Aboitiz Group CEO Sabin Aboitiz who is also lead convenor of the Private Sector Advisory Council, ICTSI chairman Ricky Razon, the SM Group’s Hans Sy, San Miguel Corp. chairman and CEO Ramon Ang, JG Summit president Lance Gokongwei, Michael Tan of the LT Group, Armscor CEO Martin Tuason, George Barcelon of PCCI and Magsaysay Group president and CEO Doris Ho.

President Marcos invited “strategic investors” to participate in the country’s economic resurgence, saying that “key structural reforms have been set into place to allow for wider participation in our industries. With the Corporate Recovery and Tax Incentives for Enterprises Act or what we refer to as CREATE and the economic liberalization measures, we have expanded the space for foreign investments in previously protected sectors, especially those that employ advanced technologies and research and development activities.”

He spoke about the strong and enduring ties between the United States and the Philippines in all aspects of the relationship that include the areas of trade, commerce and development, with the US being our third largest trading partner and fourth major source of foreign direct investments. He also assured businessmen about the reliability of the Philippines as a host for international partnerships, highlighting the country’s favorable business climate, sound macroeconomic fundamentals and the clear roadmap towards economic recovery and sustained growth, stressing that an even wider space has been created for mutually beneficial investments.

Meeting him in person, the US business executives, institutional investors and fund managers who took part in the economic briefing welcomed the openness of the President in listening to their concerns. The way PBBM articulated his economic recovery program resonated extremely well with the businessmen, giving them confidence and the assurance they needed to hear, during the economic briefing.

As Sabin Aboitiz put it, the President has the ability to “bring together the best minds in business, use them to find real solutions to real problems and then immediately implement them like he was flipping a switch.”

Several American investors also privately told me that they were encouraged by what they heard from the President and his team, all looking at expanding their operations in the country while some are mulling the possibility of diversifying their manufacturing activities or moving their operations out of China due to the supply chain disruptions brought about by the pandemic, increasing labor wages and costs, the trade war between the US and China, among other issues.

Those that could benefit from the situation are ASEAN member-nations that include the Philippines. In fact, a lot of global companies have been resorting to the “China Plus One” strategy, which is simply the diversification of their manufacturing businesses to other Asian countries, with the ASEAN region a strong contender with its combined GDP of $3.3 trillion in 2021 amounting to 3.4 percent of world GDP, according to IHS Markit.

“Over the long-term, the ASEAN region is expected to overcome the protracted negative economic shocks caused by the COVID-19 pandemic and continue to be one of the fastest growing regions of the world economy,” IHS Markit said in its report last August.

While we work closely with our ASEAN brothers here in Washington to enhance relations between the regional bloc and the United States, as diplomats, we also have our national interest and specific agenda that we must pursue for our respective nations – making us competitors in one sense. My description is that “we are gladiators by day, but collaborators at night.”

PBBM has always been interested in business and had always wanted to be a businessman. Judging from the outcome of his working visit to New York, he is turning out to be our number one marketing executive – promoting the country as the “smart investment choice” – and that the best time to do business with the Philippines is now.

While we generated $3.9 billion in investment pledges, that is really just the beginning of what I see to be a “new dawn” in our economic relationship with the United States – and that moment has come.

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