From August 23 to 26, the young Filipino-Chinese entrepreneurs of the Anvil Business Club and our peers in the Young Entrepreneurs of Malaysia will co-sponsor and hold the grand launch of the “First Asian Entrepreneurs Business Exchange” at the IOI Putrajaya Marriott Hotel in Kuala Lumpur. Anvil just came back from week-long visits to Singapore and Thailand, and is again scheduled in September to go to Quanzhou City in Fujian province and Jiangsu province in eastern China to promote economic exchanges with young entrepreneurs and top government leaders.
At recent Anvil dinners hosted by Merrill Lynch top bosses from Malaysia and Nomura Securities officials from Hong Kong — both meetings held in Shangri-La Hotel Makati — Merrill Lynch executives forecast that Philippine stocks would be among the best for investments in the world and were upbeat about the Philippines’ economic future. Despite the volatility of the US stock market in recent weeks due to concerns about the US economy, I will tell young entrepreneurs from all over Asia to invest in the Philippines now for numerous reasons, some of which are listed here:
1. Political stability and economic reforms. In the last three years of the unpopular presidency of Gloria Macapagal Arroyo, her top priority now will be to cement her legacy in the annals of history so that people will remember her more for her admittedly substantial economic reforms than her many unpalatable political controversies. We should give her credit for her very unpopular and yet gutsy economic initiatives such as the Value Added Tax, her persistent efforts to seek balanced budgets, and other economic reforms. But we need more!
For the opposition and other politicians hoping to succeed her in 2010, nobody would want to rock the boat now or help instigate a coup because the main beneficiary would be Vice President Noli de Castro, who also seems to be considering a possible presidential bid in the 2010 election.
The Philippines will therefore enjoy relative political tranquility from now up to 2010, thus making it ideal for increased investments. Whoever can assure the Philippines of sustained economic development after 2010 and attract more investments deserves to win as the next president of the republic!
2. Boom in non-traditional industries. The Philippine economy will greatly benefit from rising new industries such as mining, tourism, business process outsourcing (BPOs) and call centers, with multi-billion-dollar investments now pouring in. These new industries are, fortunately for the Philippines, dollar-earning businesses which can maximize the country’s competitive advantages in sheer wealth of natural resources, beautiful tourism attractions in 7,107 tropical isles and a large pool of English-language-proficient manpower.
Unlike India, a former British colony steeped in their own local Bollywood, the Philippines speaks American-style English and is crazy about Hollywood; thus I believe we are miles and miles ahead of India in BPO and call-center potential since the US is still the largest economy on earth with increasing requirements for outsourcing! These are among the many golden opportunities for new investments for all international entrepreneurs.
President Gloria Arroyo and the whole government should invest our limited funds in strengthening these advantages through better English-language and math/science education, instead of too many unessential courses from primary school to college. Those shameless politicians, bureaucrats or other people caught sabotaging Philippine education by over-padding public school-building expenditures, sub-standard textbooks or other crimes that negatively affect the youth’s education should be publicly shot in the Luneta!
Mining is another winner for the Philippines, which all international investors should rush into before it’s too late. An influx of Chinese and other foreign firms are now tying up with local partners to go to Surigao del Norte, Dinagat Islands, Palawan and other formerly economically backward places to venture into lucrative mining enterprises. Hopefully, there will be more international entrepreneurs who will help provide capital, technologies and overseas markets for more new Philippine mining ventures, because these businesses can directly benefit the rural masses with new infrastructure and new jobs.
The prospect of huge mining bonanzas is now encouraging the seemingly Manila-centric national government to finally pour billions of pesos into new and better roads, ports, bridges, public utilities and even local airports for some of the poorest rural provinces, therefore spurring increased economic development never before seen in these far-flung areas.
3. Business leaders increasing investments. Not only are the business leaders John Gokongwei Jr., with his expanding Cebu Pacific Air and Robinsons Land; Henry Sy with his SM malls, tourism and banks; Lucio Tan with his factories and new Eton realty ventures; the Zobel Ayalas with their Ayala Land and BPI; and Manny Villar of housing developer Vista Land increasing their long-term investments, other, younger entrepreneurs are also investing in large-scale and more long-term ventures.
Business leaders expect real growth to continue in the economy, with a boom in consumer spending from a population already pushing past 90 million people and nearly 10 percent pumping in foreign exchange as overseas Filipino workers (OFWs).
One example is TKC Steel, a quiet new back-door listing on the Philippine Stock Exchange controlled by media-shy, low-key industrialist and former iBank founder Ben Tiu. TKC has already attained its 2007 targets and is upgrading facilities with expectations of higher profits. Tiu declined to give an interview, but confirmed that their projects will bring good news to the Philippine economy, which now also needs more manufacturing.
Named after his late father, the industrialist Tiu Ka Cho, TKC Steel now owns the massive 50-hectare Zhangzhou Stronghold Steelworks Limited in Zhangzhou City, just 15 minutes away from Xiamen City in Fujian province, south China. It manufactures giant steel pipes for export and for the booming infrastructure requirements of China. What is most significant, Ben Tiu said that TKC Steel owns Philippine steel mills that will soon be modernized to become the first-ever integrated steel mill in the Philippines, with estimated investments of P8 billion, to be located either on their existing vast properties in Cagayan de Oro City or Iligan City.
As an expression of unshakable confidence in Asia’s future at a time when the US economy seems to be faltering, the Tiu family has recently launched their Sterling Bank of Asia and will invest in more high-end tourism ventures such as the tearing down of the old Gilarmi Apartments along Makati’s Ayala Avenue to give way to their 62-story Discovery Premium project.
Once ASEAN’s economic laggard due mainly to selfish political conflicts, the Philippines seems to have no way to go now but up in economic expansion and steady development. With no more life-and-death political pressures for survival, President Arroyo hopefully will vigorously set the national direction of focusing all our energies and resources on enhancing Philippine global competitiveness, inviting more foreign investors to put their money here (beyond fast-buck stock market speculation), and really strengthen economic reforms!
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