RP awakens to the potentials of its neighbors

RP awakens to the potentials of its neighbors

By Mynardo Macaraig

DAVAO, Philippines (AFP): After courting investors and traders
from the United States, Europe, Japan and the so-called tiger
economies of Asia, the Philippines is finally awakening to the
potential of its nearest neighbors, Brunei, Indonesia and
Malaysia.

Philippine President Fidel Ramos made business tie-ups a key
priority in bilateral meetings with the heads of state of Brunei,
Malaysia and Indonesia here last week and in the summit of the
Association of Southeast Asian Nations (ASEAN) leaders in Jakarta
last Saturday.

The Philippines' main business group, the Philippine Chamber
of Commerce and Industry (PCCI), last month hosted a national
conference in this southern city, specifically to court business
leaders of nearby regions of the three countries.

Joint ventures and other business agreements worth 42 billion
pesos (US$1.5 billion), all located in the southern Philippine
region of Mindanao and its neighboring islands, were signed at
the conference.

Yong Teck Lee, chief minister of the nearby Malaysian state of
Sabah, said the 300-member delegation he brought to Davao signed
25 business agreements amounting to about 21 billion pesos ($87
million) during their visit.

More significant were the contacts made at the meeting, as
well as the first-hand look that the 500 foreign delegates had of
Mindanao, which has long suffered from a reputation of
instability and danger, even among Filipinos elsewhere in the
country.

Armad Ali, an official of Sabah's Bumiputra Chamber of
Commerce, said "our visit has been very fruitful" and that he is
negotiating to import seaweed and agricultural products from the
Philippines while exporting white onions and soap to Mindanao.

The main benificiary of the conference seems to be the city of
Davao, the trading center of the Mindanao area, which during the
1980s gained notoriety due to a series of urban assassinations by
communist guerrillas.

But the communists have since dwindled in number, to be
replaced by shopping malls and new cars filling the streets.
"Today, the only killings are killings (made) in business," said
PCCI chairman Aurelio Periquet.

A Philippine scheme to integrate the economies of the Mindanao
area with those of the three nearby Asian nations under the so-
called East ASEAN Growth Area (EAGA), has also captured the
imagination of business and government leaders.

ASEAN includes the Philippines, Brunei, Indonesia and Malaysia
as well as Singapore, Thailand and Vietnam.

"Mindanao could be known for growth rates that could equal
Asia's fastest growing economies," said Nicholas Miles, managing
director of GHK Hong Kong Ltd., a consulting agency.

An Asian Development Bank (ADB) report on the potential of the
EAGA identified scores of projects that could be carried out in
the region in the short-term, including fishing joint ventures
between Mindanao and the neighboring areas.

Mindanao could also serve as EAGA's source for such products
and services as clay roof tiles and bricks, metal containers,
pre-fabricated building components, concrete products,
construction services, structural steel products, cement and
marble processing, the report said.

However, the ADB also found trade barriers, lack of investment
incentives, government red tape and inadequate transport and
financial services still hampered the development of cross-border
trade in the area.