According to The World Bank, the Philippines is currently one of the most dynamic economies in the East Asia region. The country’s growth is projected at 6.9 percent in 2017 and 2018, making the Philippines a top regional performer.
Aside from equitable tax reforms, the Philippine government has an ambitious plan to improve the ease of doing business. This, together with ramping up support for public investments in infrastructure and social services are part of the Philippine Development Plan 2017-2022, which was approved in February 2016.
For entrepreneurs who are looking to invest in the Philippines, there is no better time to do so than now. Read on for five of the best reasons to bet huge on the Philippines for investments.
1.Future Economic Giant
In late-2005, Goldman Sachs came up with the term ‘N-11.’ It refers to the 11 countries that have BRIC-like potential to rival G7 nations. The N-11 countries are Bangladesh, Egypt, Indonesia, Iran, Mexico, Nigeria, Pakistan, Philippines, Turkey, South Korea, and Vietnam.
In 2015, the Philippines is one of the fastest growing economies in the N-11 by real GDP. Currently, it is the 43rd largest economy in the world. But by 2050, the country is expected to make huge leaps, with experts projecting it to become the 14th largest globally.
2. Great ROI
Large multinational corporations such as Toyota, Intel, and IBM, to name a few have turned to the Philippines to take advantage of the country’s highly-educated workforce. Low domestic wages enable such corporations to lower their costs as well as reap benefits from the country’s leadership in outsourcing.
3. Increased FDI
Another reason to invest in the Philippines? Improved FDI, which experts are hoping to rival that of fellow ASEAN countries in the coming years. In 2016, FDI into the Philippines reached US$6.2 billion – a 22.2 percent increase from the previous year.
Other factors that would usher in foreign direct investments into the country include:
- The country’s membership to ASEAN
- Abundant natural resources
- Favorable investment policy
- Strategic location; and
- Skilled, English-speaking workforce
4. Tax and Diplomacy Reforms
The current administration is seeking to lower taxes on business and personal incomes. With tax reforms, both foreign and local companies stand to benefit so it is best to position themselves before the renewed economic boom. That means starting a new business or expanding operations as soon as possible.
Also under the new administration, the Philippines is poised to normalize and repair ties with China, the second largest economy in the world. With the country maintaining good relations with the US and China, there is no doubt that diplomacy reforms will boost the economy.
5. Unlimited Business Opportunities
According to investphilippines.gov.ph, the Philippines is the most strategic location for companies that want entry to the large ASEAN market and the trade opportunities it offers. Best sectors for investment include:
- Manufacturing (e.g. Pharmaceuticals)
- IT and BPO
- Tourism; and
- Agri-Business
Another thing to note is the Philippines’ support of a BOT (build-operate-transfer) investment scheme. This means the country allows 100 percent ownership in almost all sectors, with even government corporations being privatized. There are also incentives to consider such as tax exemptions, as well as duty-free importation of certain materials and equipment.
Are You Looking to Invest in the Philippines?
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