Electronics giant New Kinpo Group (NKG), one of the biggest Taiwanese investors in the country, will invest more than P3 billion in improving its business here in the next five years, but warned that the government should be cautious of removing perks when the economy has not yet reached its peak.
NKG will spend $65 million (or more than P3 billion) to improve current operations and put up new facilities to meet growing demand its products.
In a recent interview with the Inquirer, NKG CEO Simon Shen said they would open up two new facilities next month. This would be followed by another facility that would open in the middle of next year.
“The company has a high interest in investing in the Philippines. So far, we have already invested more than $185 million in the Philippines. In the next three to five years, the total investment in the Philippines would go up to $250 million,” he said.
The company, which produces 35 million calculators in the Philippines yearly, among other products, expects continuous growth in terms of sales in 2018 and 2019. NKG exports most of its products.
However, the company official warned against an ongoing move to rationalize the tax incentives that the government offers to investors like NKG.
This develops as the Duterte administration is pushing for the second comprehensive tax reform package, which would not only lower corporate income tax but also reduce some tax perks as well.
“The Philippines needs to compete with different countries. Even though the Philippines wants to do this, they need to consider different situations [in other countries],” he said.
“For example, they need to consider the tax incentives in Indonesia, Vietnam, or even China,” he added, noting that the company operates in other countries as well.
The package would most likely affect companies registered under investment promotion agencies (IPAs), which attract local and foreign investors to do business in the Philippines by offering tax perks. —ROY C. CANIVEL