Beijing firm plans to establish plant for environment-friendly bikes, motorcycles and scooters in Davao City

DAVAO CITY (MindaNews / 26 June) – A Beijing-based multinational manufacturing firm is planning to build a light manufacturing plant here for environment-friendly electric bicycles, motorcycles, and scooters that will be sold to the market within the Brunei, Indonesia, Malaysia, and Philippines East ASEAN Growth Area (BIMP-EAGA).

Art Milan, president of the Davao City Chamber of Commerce and Industry Inc. (DCCCII), said in an interview at the sidelines of “Wednesdays’ at Habi at Kape” that members of the Davao chamber had met with representatives of the Chinese company on Tuesday to do an initial discussion on their possible entry to the region as its manufacturing hub.

He said a 20-member Chinese delegation would return to Davao City in August to do a market study since electricity-run public transportation vehicles are something new to the Philippines.

“They don’t have a timeline…. They are planning to meet with local businessmen in August during the general membership meeting of DCCCII. They want to get market data, they wanted to get the pulse,” he said.

Milan recalled telling the Chinese executives that the domestic market of the motorcycles is dominated by Japanese brands.

He said the Chinese wanted to enter Davao because of it is strategically located within BIMP-EAGA, covering the entire sultanate of Brunei Darussalam; provinces of Kalimantan, Sulawesi, Maluku, West Papua and Papua in Indonesia; states of Sabah and Sarawak and the federal territory of Labuan in Malaysia; and Mindanao and the province of Palawan in the Philippines.

Once the plant is established, he believes the Chinese firm would be exporting products from Davao to the BIMP-EAGA. “Export probably. That’s their plan, that’s why they want to set up their manufacturing plant in Davao,” he said.

“They look at it as a launching pad to enter BIMP countries. According to the Chinese, aside from Mindanao, with Davao as the center, you can access the market of east Indonesia, east Malaysia, and Brunei,” he said.

Due to the lack of industrial park in the city, Milan said he would bring the Chinese to the Floreindo-owned Aflo Industrial Estate in Panabo City and to Sta. Cruz town in Davao del Sur as potential areas to host their plants.

He surmised that some Chinese firms wanted to expand their operations outside China as the labor cost there is shooting up because the standard of living there is starting to get costly.

During the recent Davao Investment Conference (Davao Icon), there were around 40 Chinese business executives who joined, the most number of foreign delegates who joined the conference.

Milan said delegates from Japan, Singapore, South Korea, Malaysia, Indonesia, and European countries graced the Davao Icon, which aimed to encourage investors to invest in Mindanao and Davao’s tourism, infrastructure, real estate, information and communication technology, and Halal trade industries.

Approved Chinese investments in the country in 2018 reached P50.692 billion or higher by more than 2,000 percent compared to the P2.333 billion recorded in 2017, according to a data released by the Philippine Statistics Authority (PSA) on February 28.

Investments from China comprised 28.3 percent, the highest, of the P179 billion in total foreign investments approved last year.

Singapore came in second with approved investment pledges worth P21.181 billion. Japan pledged P19.727 billion in investments; British Virgin Islands, P16.165 billion; Malaysia, P14.652 billion; United States of America, P12.858 billion; Taiwan, P4.2 billion; United Kingdom, P3.81 billion; France, P2.561 billion; and Australia, P2.410 billion.

These figures were based on the pledges approved by the Board of Investments, Clark Development Corporation, Philippine Economic Zone Authority, Subic Bay Metropolitan Authority, Authority of the Freeport Area of Bataan, BOI-Autonomous Region of Muslim Mindanao, and Cagayan Economic Zone Authority.

Manufacturing emerged as the most preferred investment area with P85.124 billion or 47.6 percent of the total foreign investments. Electricity, gas, steam, and air conditioning supply came in second most preferred with P30.048 billion. (Antonio L. Colina IV / MindaNews)