Japan’s emperor and empress are making a historic visit this week to the Philippines, with which it has been enjoying improved bilateral economic ties, in part due to the Philippine Japan Economic Partnership Agreement (Pjepa).
Japan is the Philippines’ top trading partner and largest investment source, attributed largely to the easing of restrictions and tariff barriers under the Pjepa.
Data from the Department of Trade and Industry showed that total bilateral trade between the two countries grew from 2010 to 2014 at a rate of 7 percent a year.
From only $14.6 billion in 2010, bilateral trade between the two countries grew by 31 percent to $19.15 billion in 2014.
The Philippines enjoys a trade surplus as its exports to Japan, which grew every year by 15.39 percent from 2010 to 2014, have consistently outpaced the country’s imports of Japanese goods.
Latest data from the Philippine Statistics Authority also showed that as of end-November 2015, Japan was still the country’s top export destination for electronic products, construction materials, transport, and minerals, accounting for $11.4 billion or 21 percent of the Philippines’ total export revenues for the period.
According to the DTI’s Export Marketing Bureau, exporters of Philippine food products face “very good prospects” in Japan, which imports a huge amount of food products, including seafood and fruits, due to the increasing diversification of the people’s diet and advancing age of its farmers.
In terms of investments, Japanese companies invested P35.7 billion in the country in 2014, as many of them remained bullish on the business opportunities here, particularly in the manufacturing sector.
This optimism stemmed from the Philippines’ strong economic growth and highly skilled, English-speaking labor pool.
Nobuo Fujii, vice president of the Japanese Chamber of Commerce and Industry of the Philippines Inc. (JCCIPI), said in an interview with the Inquirer that closer coordination between Japan and the Philippines was realized due to the Pjepa.
According to Fujii, the provisions under the Pjepa have similarly benefited the Japanese automotive, food, and tourism industries, while the Philippines also saw improved access for its nurses and caregivers over the past years.
Both countries believe there remained enough room for bilateral trade and investment ties to improve further if more concessions will be provided under the Pjepa, which is already up for review.
The Philippines, for one, is seeking zero duties and the scrapping of quotas for agricultural products such as bananas and pineapples.
The Pjepa was signed on Sept. 9, 2006 in Helsinki, Finland by former President Gloria Macapagal-Arroyo and former Japanese Prime Minister Junichiro Koizumi. It was ratified by the Philippine Senate in 2008.