Philippines, China upgrade bilateral trading agreement

BEIJING (MindaNews/16 Aug) – Government economic managers of the Philippines and China held a top-level meeting recently to further spur bilateral trade between the two nations.

The meeting, which was held in Shanghai on August 5, covered “wide range of bilateral economic cooperation” that is expected to be formally signed during the scheduled state visit of Philippine President Benigno S. Aquino III here this month.

Trade and Industry Undersecretary for Policy Adrian Cristobal and his Chinese counterpart, Vice Minister for Commerce Chen Jian, who both co-chaired the meeting, discussed the possibility of expanding further the two nations’ bilateral trade and investments, China’s overseas development assistance to the Philippines, technical cooperation on statistics and standards, the ASEAN (Association of Southeast Asian Nations)-China Free Trade Agreement, and factors in the existing environment which hamper the smooth flow of goods, investment and services.

The meeting has special significance as it took place just ahead of the planned visit of President Aquino to China.

Cristobal noted that China is “the leading partner of the Philippines” when it comes to trade, investments, development assistance and technical cooperation.

“Proof of this was that the President sent a high-level economic managers team to China to invite investments in the infrastructure sector in the Philippines,” he said, adding that exports have fully recovered from the slump experienced in 2009 financial crisis and the Philippines seeks to double this by 2016.

Data from the China Ministry of Commerce showed that bilateral trades between the Philippines and China have reached $27.7 billion in 2010.

Chinese Ambassador to Manila Liu Jianchao has said that Chinese exports to the Philippines for 2010 hit $11.5 billion, an increase of 34.3 percent from 2009, while total imports from China reached $16.2 billion, a 35.6 percent growth from the previous year. On the Philippine side, export to, and imports from, China both breached the $1-billion mark last year.

It said China’s investments to the country also peaked at $86 million, up by 112 percent as compared to 2009, while total Philippine investments to China amounted to $116 million in 2010.

At present, China and ASEAN member countries have an existing trade agreement that was created in 2001, the main objective being to promote a free flow of market and dismantle trade barriers.

The China-ASEAN Free Trade Area has greatly promoted bilateral economic, trade and investment cooperation in recent years with the implementation of zero-tariff policy.

Last week, the Philippines, along with other four member countries of ASEAN, has edged out Japan in becoming the third largest trading partner of China.

During the meeting, Cristobal encouraged Chinese businessmen and investors to look at the agribusiness and food industry in the Philippines, help the southeast country to boost its capacity to produce for China.

In this, China can bring in not only its capital but share its great advances in agricultural technology. China is capable and ready to transfer technology in this field, he said.

China should look at the strength of the Philippines in the area of business process outsourcing (BPO), Cristobal said.

Although the Philippines is a small country, it is successful in the BPO sector, being number one in voice and number three in backroom operations, he said. He added that the Philippines can also help in servicing China’s aging population.

For his part, Chen said China is serious in importing agriculture products, particularly fruits, from the Philippines.

He said China is also looking for some ways “to help the Philippines shore up the need of capital for its economic modernization program.”

“[Both sides should] get down to business and not let minor issues distract their attention,” he said.

China and the Philippines have figured in a word war following the tension in the West Philippine Sea or South China Sea over territorial claims.

Cristobal said both sides are also looking on how to improve its relations.

“Tourism would be a key to this effort, as this would promote more investments and trade,” he said. (Darwin Wally T. Wee / MindaNews)