Encouraged by the improvement in RP-Taiwan relations, Taiwanese businessmen have launched an aggressive search for investment prospects but political uncertainties cloud the prospects of the Philippines becoming a favored destination for investments.
Despite the country’s proximity to Taiwan and the favorable investment prospects, leaders of the Taiwanese business community said other Southeast Asian countries have consistently beaten the Philippines in the contest for attracting investments from Taiwan.
Renowned Taiwanese businessman Jeffrey L.S. Koo told reporters that even Taiwanese investors were baffled by the fact that Taiwanese investments in the Philippines are the lowest in the whole of Southeast Asia.
Koo, one of the most powerful businessmen in Taiwan, as in the Philippines as honorary chairman of the Chinese-Philippine Business Council (CPBC), attending the 15th Joint Meeting of the CPBC and the Philippine-Chinese Business Council (PCBC).
Koo owns Chinatrust Philippines Commercial Corp., one of the very few commercial banks in the country that is 100 percent foreign-owned. Aside from banking, the Koo group also has interests in cement through its controversial subsidiary, Taiwan Cement Corp. (TCC) which exports cement into the country. According to Koo, he is on the look-out for investments in banking and cement production.
"We are in the midst of expanding our banking operation in Malaysia because there is a huge Taiwanese community there but we are also looking at expanding our banking business here," he said.
Chinatrust has been rumored to be negotiating for the acquisition of an interest in Equitable Banking Corp. but Koo denied any knowledge of the planned acquisition.
"Maybe we are, I don’t know because I have not received any report from my people," was his non-committal reply. Nevertheless, he said he is constantly on the look-out for possible merger with other banks as Chinatrust moves to expand its network in the country.
Koo did not rule out the possibility of going into cement production, saying he has not stopped looking for a possible acquisition.
"As far as I know, we have been trying to acquire cement interests in the Philippines but somehow it hasn’t been successful," he said. "I don’t really know why because my cousin [Leslie Koo] is the one running the cement business."
According to Koo, Taiwan’s accumulated investments in Southeast Asia amounted to $43.7 billion as of June 2000. The largest share, he said, went to Indonesia amounting to $17 billion, followed by Thailand with $10.2 billion. Malaysia, Vietnam and Singapore cornered $8.8 billion, $4.9 billion and $1.7 billion each respectively, while the Philippines attracted less than $1 billion.
"Why? I don’t know," Koo said. "But one thing is sure, something has to be done to correct this situation. The Philippines is an ideal destination, we have to figure out why investments from Taiwan are not coming in."
When Taiwanese investors started searching for off-shore investments in the mid 1980s, Koo said the Philippines was one of the front-liners because of the cultural similarities, skilled and cost-effective labor, resources and incentives. However, the investments never materialized as other Southeast Asian countries attracted the bulk of capital outflow from Taiwan.
"The only thing I can think of is political instability," Koo said. "Personally, though, I have put more money in the Philippines than any other countries."