The Philippines should “do much more” and “push harder” to improve the country’s investment climate as it continues to lag behind neighbours in Asia, said Akio Isomata, economic minister of the embassy of Japan in the Philippines at a press conference in Manila held on March 14.
He cited congested logistics infrastructure, including roads and ports, expensive and unstable power supply and the delayed release of tax refunds as major concerns among Japanese investors.
Japan is a leading economic and development partner of the Philippines, with a number of Japanese companies operating in the country, and the largest source of official development assistance, with $593.3 million in aid disbursements in 2011 as per latest available figures, including military aid.
In turn, Japan is the Philippines’ top export market and leading trading partner, accounting for around $13 billion in total bilateral trade in 2012, according to figures of the Department of Foreign Affairs
Despite the glowing statistics of the economy, the Philippines “cannot afford to be complacent” amid the optimism generated by its standout growth rate of 6.6 per cent in 2012, Isomata said.
He added that implementation of aid-supported infrastructure projects remains slow and poor maintenance, especially for roads and ports, was another concern.
Japanese companies are also hoping for improvements in the energy sector, including a stable and affordable power supply, whose current rates are known to be the most expensive in Southeast Asia.
He also recommended a pay rise for public servants in the Philippine government in order to “dispense their responsibilities as they should” and “mobilise the bureaucracy.”
Akihiro Ushimaru, President of the Japan Chamber of Commerce in Mindanao, also cited power supply and infrastructure as major concerns for his fellow Japanese investors.