The sixth meeting of the Sub-Committee on the Improvement of Business Environment under the Philippines-Japan Economic Partnership Agreement (PJEPA) was held on 11 April 2013 in Manila. Ambassador of Japan, H.E. Toshinao Urabe, and Executive Director of the Department of Trade and Industry, Hon. Lucita P. Reyes, co-chaired the meeting.
Representatives from various Philippine government agencies, Embassy of Japan in the Philippines, Japan International Cooperation Agency (JICA), and Japan External Trade Organization (JETRO) attended the meeting. The private sector was represented by Mr. Takashi Ishigami, President, Japanese Chamber of Commerce and Industry of the Philippines Inc. for the Japanese side and Mr. Sergio R. Ortiz-Luis Jr, President of Philippines Exporters Confederation, Inc. (PHILEXPORT) and Mr. Donald G. Dee, Vice Chairman of Philippine Chamber of Commerce and Industry (PCCI) for the Philippine side.
PJEPA, which entered into force in December 2008, is an important framework for enhancing economic relationship between the two countries. Both sides noted that recent figures related to trade and investment had been very encouraging despite difficult economic situations around the world. To illustrate:
a. Trade volume between the two countries increased in 2012 as compared to 2011; Japan was the largest importer of Philippines’ export marking US$ 9.88 billion in 2012 from US$ 8.90 billion in 2011. Philippines’ import from Japan slightly decreased to US$ 6.45 billion in 2012 from US$ 6.52 billion in 2011.
b. Japan was the second largest investor to the Philippines in terms of investments approved by the Investment Promotion Agencies (IPAs) with the value of PHP 69.0 billion in 2012.
During the meeting, both countries noted continued and renewed interests shown by Japanese investors in the Philippines as evidenced by a series of recent investments by Japanese companies. Both sides welcomed the recent flow of new investments from Japan as an affirmation that the Philippine economy is showing remarkable performance and proving its competitiveness as investment destination. Both sides reaffirmed the usefulness of the Sub-Committee in keeping up this momentum.
Issues discussed in the meeting included tax-related issues, rationalization of investment incentive schemes, affordable, predictable and sustainable supply of electricity, utilization of Batangas and Subic Ports, other issues related to the improvement of business environment.
The Japanese side acknowledged notable measures taken by the Philippine side to make progress in the country’s investment climate, such as passage of Republic Act No. 10378 which rationalizes the taxes paid by international carriers in the country, and substantial progress made by the Philippine side on the monetization of outstanding Value Added Tax (VAT) Tax Credit Certificates (TCCs).
The dialogues aim for steady and concrete progress on the resolution of specific issues in order to ensure that transparent, predictable, and consistent business environment is achieved. Both sides agreed that continued dialogues with business communities are instrumental in inviting further investments to the Philippines; and addressing issues faced by Filipino companies operating in or exporting to Japan. Both sides expressed resolve to reduce outstanding issues before the next meeting of the Sub-Committee.
The next meeting of the Sub-Committee is scheduled in September 2013.
Japanese Version
