By Leslie D. Venzon of PNA
The Philippines remains an attractive investment destination among companies from the Asia-Pacific Economic Cooperation (APEC) economies given its large domestic market and high talented labor pool.
This, despite a survey result showing that Asia-Pacific chief executive officers (CEOs) believe that prospects for business growth over the next 12 months are dimming fast amid financial market volatility and cyber security concerns.
PwC network’s fifth annual APEC CEO Survey covering 800 CEOs and industry leaders indicates that around half of them still intend to raise investments next year, particularly in the Philippines, Vietnam and Singapore.
The majority of CEOs (53 percent) planned to increase investments, with most of that investment (68 percent) aimed for the APEC region despite their dwindling confidence in revenue growth.
Alexander Cabrera, chairman and senior partner at PwC Philippines, identified the huge domestic market and availability of talent as the Philippines’ competitive advantage.
“The Philippines is a nation of very good professionals –doctors, accountants, architects and engineers. …Because the skills will move more freely and they know that the Philippines is a source of those skills, that’s really raising their (CEOs) confidence level that if they come here, if they bring the business to the Philippines, that there will be enough (human) resource here to support that business,” he said in an interview.
To further attract investments, Cabrera underscored the need to simplify doing business in the Philippines to be at par with the global economies.
He noted the country should also continue focusing on development of the small and medium enterprises (SMEs).
“If these SMEs will be assisted during their formative stage, if the time that they can access the foreign markets will be shortened, if they will be part of the value chain of the big corporations, that will produce the inclusive growth that is really important,” he added.
Cabrera said the middle class in the Philippines needs to be likewise enlarged.
“That effectively expands the domestic market of these businesses in the Philippines. That’s also a big source of business growth,” he said.
Meanwhile, the PwC’s survey shows that there is a clear diversification of investments within the APEC region, with China, the United States and Indonesia remain the main draws for CEO business investments.
“I think (on) diversification of the investment locations, we are really beneficiaries of the slowdown in China,” Cabrera said.
He believed that Philippine CEOs appear not affected by the coming elections.
“I think the fact they remained optimistic about revenue growth may prove maybe the point of some prophets of boom. They are saying that regardless of who wins in the next elections, the economic gains of the Philippines are irreversible,” added Cabrera.
More of the 800 APEC business leaders surveyed –PwC’s largest sample ever—think that expanded broadband access and increased participation in the digital economy hold the most promise for their business from regional connectivity, ahead of regional trade projects or new infrastructure in underdeveloped areas of the region.
They are also optimistic a free trade area in Asia Pacific could be a reality by 2020 as regional integration proceeds on several fronts.
CEOs consider the ASEAN Economic Community as the ‘mega regional’ game changer, while there are also hopes that Trans-Pacific Partnership (TPP) will boost exports and fuel regional growth.
The PwC’s 2015 APEC CEO Survey, conducted between June 23 and August 21, was released Monday ahead of the annual APEC Leaders Meeting on Nov. 18 to 19. (PNA) FPV/LDV
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