Booming Philipines

Three weeks after a trip to China, President Benigno Aquino is in the United States this week. Next week he takes a trip to Japan to press investment opportunities and spread the word to investors in major trading partners that things are changing.

The Philippines has massive untapped mineral wealth, a prime position between Southeast and North Asia, a large, growing and English-speaking population, and more than 7,100 islands offer the scope for every type of tourist activity. But bitter experience of endemic corruption, legal inconsistency, violence and stifling bureaucracy has made foreign business wary and seen the country fall behind its neighbours.

Japan's ambassador to the Philippines Toshinao Urabe said, "It's about red tape, and about the weakness of institutions, infrastructure, and about electricity and traffic jams. It's nothing secret". He also added that ,"We are attracted by the potential of the Philippine economy. You have a huge population, you have the resources."

Philipines attracts billions

Data from ASEAN shows the Philippines attracted just $1.7 billion, or 2.3 percent of the 75.6 billion US dollars of foreign direct investment that flowed into the 10 members of the Association of South East Asian Nations (ASEAN) in 2010, trailing Singapore, Indonesia, Malaysia, Vietnam and Thailand. The country has mineral reserves, including massive gold and copper deposits, estimated to be worth around 1 trillion dollars.

Among ASEAN countries, the Philippines ranks sixth for tourist arrivals, drawing just under 5 percent of almost 74 million people visiting the region in 2010.

"We are not where we should be," Aquino told Reuters in an interview. The interest is there, he says. His trip to China produced 7 billion to 9 billion dollars of potential investments, and the government cotinually receives unsolicted proposals.

Conglomerates heading towards Southeast Asia

Aquino said that "one airline and hotel conglomerate wanted to build 30 hotels, with the first two to open next year. However, the group has not decided what routes would be serviced or where all the hotels would be built."

Aquino's election last year raised hopes of improved governance after two administrations dogged by allegations of corruption and wrongdoing.

And there are signs of improvement - the Philippines has jumped 10 places to 75th in the World Economic Forum's global competitiveness index.

Aquino said "I see my role really as to complete what they (his parents) both started and nurtured. This would be the culmination that we finally have overcome that hump and that the progress will continue regardless of who is here.The greatest tragedy would be for the next generation to undergo the same problems we did. That would mean we're an utter failure."

Author: Marina Joarder (Reuters)
Editor: Grahame Lucas