Philippine and Japanese companies will sign close to P300 billion worth of business deals this week during President Rodrigo Duterte’s four-day visit to Japan, according to Trade Secretary Ramon Lopez.
The investment deals and pledges would create 80,000 jobs for Filipinos, Lopez said in a statement. He said he would witness the signing of over 20 business agreements on the sidelines of an international conference in Tokyo.
The President will arrive in Tokyo on Tuesday to attend Nikkei’s 25th International Conference on The Future of Asia and to sit down for a bilateral meeting with Japanese Prime Minister Shinzo Abe.
The annual gathering, according to its official website, will be attended by political, economic and academic leaders who will “offer their opinions frankly and freely on regional issues and the role of Asia in the world.”
Lopez said most of the investment pledges would be in infrastructure, manufacturing, electronics, medical devices, business process outsourcing, power, electricity, transport, automotive, food manufacturing and marine manpower industries.
He said Japanese investors remained bullish on the sustained growth momentum under the Duterte administration given its aggressive infrastructure buildup, meaningful investment and financial reforms and demographic advantages.
Japan is the Philippines’ third major export market and import supplier.
In 2018, Japan was the Philippines’ second major trading partner with total trade of $20 billion—$9.5 billion in exports to Japan and $10.5 billion in imports from Japan.
Fear of losing perks
The DTI will hold a business forum and roundtable discussions to have a closer dialogue with Japanese investors and provide an opportunity for greater business-to-business interactions.
Export-oriented Japanese companies operating in the Philippines are among the most worried foreign investors about the government plan to rationalize tax incentives, fearing that the perks they enjoy will be removed under the tax reform program.
Finance Secretary Carlos Dominguez III has assured Japanese investors that the pending second tax reform package aimed at rationalizing their fiscal incentives would be beneficial to both the government and the business sector.
At a recent meeting with Osaka-based Kansai Economic Federation, Dominguez told Japanese businessmen that the second package of the administration’s tax reform program would be a game-changer that would expand, rather than curtail, opportunities for them to do business in the Philippines.
The tax reform program aims to cut the corporate income tax rate and rationalize investment incentives.
On Tuesday night, the President is expected to land in Tokyo, two days ahead of the Nikkei conference. It will be his seventh meeting with Abe since he assumed the presidency in 2016 and his third visit to Japan.
The President will be accompanied by Lopez, Dominguez, Foreign Secretary Teodoro Locsin Jr., Agriculture Secretary Emmanuel Piñol, Public Works Secretary Mark Villar, Cabinet Secretary Karlo Nograles, Tourism Secretary Bernadette Romulo-Puyat, Transportation Secretary Arthur Tugade, Science and Technology Secretary Fortunato de la Peña and Energy Secretary Alfonso Cusi.
Also in his entourage are Socioeconomic Planning Secretary Ernesto Pernia, ICT Undersecretary Eliseo Rio Jr., Presidential Communications Secretary Martin Andanar, National Security Adviser Hermogenes Esperon Jr., his spokesperson Salvador Panelo and his peace adviser Carlito Galvez Jr.
On Wednesday, the President is expected to sit down for a roundtable meeting with several Japanese businessmen and grace the business forum. On Thursday night, he will also meet the Filipino community based in Tokyo.