Amid closer ties between Manila and Beijing under President Duterte’s watch, the Philippines was among the Asean countries that benefited the most from new investments related to China’s Belt and Road Initiative in recent years, United Overseas Bank (UOB) Ltd. said.
“Mainland Chinese foreign direct investment (FDI) and construction projects in countries in the Association of Southeast Asia Nations (Asean) have increased by 85 percent and 33 percent, respectively, since the start of the Belt and Road Initiative, with growth concentrated in Indonesia, Malaysia, the Philippines and Vietnam,” UOB said in a joint report with the Hong Kong University of Science and Technology’s Institute for Emerging Market Studies.
In the case of the Philippines, “the political rapprochement between mainland China and the Philippines that is taking place during the Duterte administration is boosting trade and investment relations,” UOB said.
“The market strives to attract Chinese investors through its visa-on-arrival policy and relaxation of visa policies for Chinese workers,” UOB noted.
UOB said that since 2017 or President Duterte’s first full year in office, China had become the Philippines’ most important source of FDI, while “investment from the US has diminished in recent years.”
Citing Philippine government data, UOB noted that investment pledges by Chinese firms reached $965.8 million worth in 2018, on top of another $33.9 million from investors based in Hong Kong, a special administrative region of China.
UOB also cited a surge in FDI from the British Virgin Islands as it was “serving as an investment platform for multinational corporations … to benefit from its favorable legal and tax regimes for their investments.” INQ