More companies target Manila as regional hub

More companies target Manila as regional hub

MANILA (UPI): The government said yesterday four more foreign firms are planning to make the Philippines the center of their Asia-Pacific operations, boosting the country's bid to become the region's next business hub.

The Trade and Industry Department said the latest firms eyeing Manila are the Swiss medical instruments maker Allo Pro Ag, Hong Kong's shipping consulting firm Caterlog International, German pharmaceutical firm Asta Medica and British Virgin Islands' cargo company TransAsian Air.

"There really is a lot of interest to come here in the Philippines," Dennis Miralles, chief of the Trade Department's regional investments group, told United Press International. "In terms of operating costs such as cheap rental and labor, we have an advantage."

The entry of the four foreign firms brings to 19 the number of companies that have registered with the Board of Investments to set up regional centers in the country since January.

Those companies include baby foods maker Gerber Finance Co. and heavy machineries manufacturer Demag Delaval Turbomachinery Corp., both U.S.-based firms.

Analysts have down played, however, the Philippines' potential to become the region's next business hub. They have said that despite the economic and social advances made during the first half of President Fidel Ramos' term, the sectors crucial to business such as telecommunications and transportation are still undergoing birth pains, having been deregulated only recently.

But Millares is confident foreign firms will see that the Philippines is catching up with the development of its industrialized neighbors.

With a goal of reaching a newly-industrialized status by the year 2000, Ramos opened up long-protected industries such as aviation, banking and telecommunications.

In the last three years, the government has opened the country's doors to 10 new foreign banks, broken the former monopoly of the Philippine Long Distance Telephone Co. and allowed new carriers to compete freely with Philippine Airlines.

The government has also generously given special incentives such as tax breaks and duty free importation of goods to foreign firms.

Special economic zones, which offer the most incentives, have also been attracting labor intensive industries to their fold. A former U.S. naval base in Subic, just north of Manila, has been the most aggressive among the growth centers in luring foreign firms. The Subic Bay Freeport Zone -- which has already taken in international cargo firm Federal Express and oil company Coastal Petroleum investing in its area -- aims to become the next Hong Kong-style free port.

Miralles said other Hong Kong-based companies have also expressed interest in taking a look at the Philippines as an alternative base for their operations.

He said some 175 firms attended some two weeks ago a Manila- sponsored investment seminar in Hong Kong aimed at wooing in more investors to the country. Some of those firms have already coordinated with the Trade Department for setting up possible bases in the country.