Chinese firms eyeing agri, garments ventures in Phl

MANILA, Philippines - The Department of Trade and Industry (DTI) said Chinese companies, specifically from Shanghai, are looking at the Philippines for trade and investment opportunities this year.

Several companies in China are sourcing agro-based products, including fresh Cavendish bananas from the Philippines, while other firms are locating in the country for their garments production.

“Our bilateral relations with China are greatly influenced by trade and investments between our two countries. We have seen remarkable increase in terms of Philippine exports to China and Chinese investments in the Philippines in the past months,” Trade and Industry Secretary Gregory L. Domingo said.

From January to July this year, China was the Philippines’ third largest trading partner, with cumulative growth of 31 percent, according to data from the National Statistics Office (NSO). Philippine exports to China likewise experienced double-digit growth of 38.7 percent for the July period, latest data showed.

Chinese firm Shanghai Haodong International Trade Co. Ltd. recently sourced 60 containers of fresh Cavendish bananas from the Philippines amounting to P23.22 million. The company requires six to 10 40-footer containers of fresh Cavendish bananas every week.

The Philippine Trade and Investment Center (PTIC), the commercial post of the DTI in Shanghai, and the Bureau of Export Trade Promotion (BETP), have assisted Shanghai Haodong recently to match them with local banana growers who can provide a steady supply of fresh bananas to China.

Another firm, China’s high-end garments producer Shanghai Zephyr, has chosen the Philippines as location of its production facility. The project’s initial cut-and-sew operations are expected to employ 150 workers.

The growth and rising income of the middle class in the southern and eastern regions of China, including Guangzhou and Shanghai, present various touchpoints for increased trade with China, the DTI has observed.

China has become the world’s fastest growing economy today. Along with China’s economic expansion, the growth of the Chinese middle class also presents opportunities to foreign companies who can capitalize on this rising wealth and consumer market.

According to the Euro Monitor, China’s middle-income earners will likely reach 700 million by 2020, a trend that will transform China’s consumer market.

During the recent visit of President Aquino in China, a total of $13 billion actual and possible investments were committed by Chinese businessmen to the Philippines.

Under the Philippine Export Development Plan 2011-2013, China has been identified as an important market for Philippine exports.

The recent signing of the ASEAN-China free trade agreement (CAFTA) effectively eliminated tariffs of close to 90 percent of goods flowing into China from ASEAN, opening doors for ASEAN member countries to access a market of close to two billion consumers.

Since the implementation of CAFTA, ASEAN-China total trade has been increasing at an annual average rate of 26 percent.