Domingo eyes Asian investors for auto sector
The government is wooing companies from richer Asian neighbors to invest in local facilities and bridge gaps in the country’s auto manufacturing supply chain, allowing the Philippines to build and export more cars.
Trade and Industry Secretary Gregory Domingo said the main target were Chinese investors, many of whom were exploring opportunities in the Philippines.
“What we are looking for is to fill up the supply chain,” Domingo said in a recent interview.
His statements came following a recent visit by a delegation from the China Council for the Promotion of International Trade (CCPIT), which is looking at investment opportunities in the country.
China is the Philippines’ largest trading partner.
“Our interest is to find auto parts suppliers for gaps. We need plastic moldings, steel tools, dies. We can get that from anywhere, but China, being a big manufacturer, would be a natural place to look,” Domingo said.
To entice investors, the government is preparing a “road map” for the auto industry that would enumerate perks for manufacturers and other incentives that aim to create more jobs.
Other likely provisions would be the mandatory replacement of all 10-year-old vehicles and the inclusion of manufacturing fuel-efficient cars under the list of priority investments that receive automatic tax perks.
“That’s already moving,” Domingo said of the road map, but declined to say when it would be released.
He said that aside from China, the country also wants to attract investors from Japan and South Korea, which both have large auto manufacturing sectors.
Increased production in the country is expected to serve both the local and foreign car markets.
DTI records show that there are just 33 registered cars for every 1,000 Filipinos, indicating higher room for growth compared with more mature neighbors.
The local auto manufacturing industry directly employs 868,000 employees.
The top three car companies contributed the following amounts to the government in 2012 in the form of taxes and duties for imports: Toyota, P7 billion; Mitsubishi, P5.5 billion; and Hyundai, P4.8 billion.