KEYNOTE SPEECH OF SECRETARY RAMON M. LOPEZ
KOIMA PHILIPPINES-KOREA BUSINESS FORUM
AND NETWORKING LUNCH
11 July 2019, Conrad Hotel, Pasay City
As delivered
Ladies and gentlemen, good morning! Annyeong haseyo!
[Acknowledgements]First, I’d like to thank the Korea Importers Association (KOIMA) for inviting me to speak before you today. And I would like to welcome the Korean delegates of KOIMA to the Philippines as you conduct your buying mission.
Again, as we met last month in Korea, we extended the invitation and we are making sure that your visit would be very fruitful as well as giving you time to look at the other products and other places in the Philippines that hopefully you can find time to also appreciate the culture that we have here in the country.
On a personal note, I would like to thank Chairman Kwang-hee Hong and his team for organizing this mission. This effort was originally set up as part of the celebration of the 70th anniversary of diplomatic relations between the Philippines and Korea this year.
In fact, we are all working on many projects that we hopefully culminate when the President sets in visit to Korea sometime in November this year. When we visited Seoul last month, I discussed this mission with Chairman Hong and the activities agreed upon by KOIMA and the Philippine Trade and Investment Center (PTIC) in Seoul headed by Councilor Jojie Dinsay. During our talk, Chairman Hong requested the support of the Department of Trade and Industry (DTI) to help them achieve their goal of giving Philippine products access to the Korean market.
I wish to assure you that—as we had committed in that meeting—DTI and our partners promise to make your visit here a success especially as far as business matching is concerned. Moreover, we hope to make your trip memorable as well.
PH-KR Trade Relations
As the Ambassador noted earlier, the Philippines and Korea share a long history, recently marking its 70th year anniversary of diplomatic relations. Trade and investments between our two nations have also been booming.
As of 2018, Korea is the Philippines’ 4th largest trading partner, our 8th top export market, and our 2nd top source of imports. We have recognizes well that there is a trade imbalance and that’s the reason why we fully appreciate the efforts being extended by the Korean government. And now, by the KOIMA Group that will look at all other products that they could purchase for the Philippines in the hope of also narrowing the gap of trade imbalance that we have in Korea.
In fact, as we thought of the trade imbalance it is one of the reasons why we initiated the elevation of our trading relationship from what we have right now which is basically an ASEAN—Philippines being part of ASEAN – ASEAN-Korea FTA. And we want to have our own bilateral FTA between Philippines and Korea.
As many of you would know, it started also with our desire to have our key export commodities. In particular, bananas – which are with huge potential in gaining more market access in Korea and making better, I guess the tariff rates that can be offer to our critical export items like bananas, pineapples and other products including industrial products.
So when we we’re discussing that with the Foreign Trade Minister of Korea and we’ve looked at several mechanisms by which we can take this up and then later we decided that having a bilateral FTA would be the best way to discuss all these and have a renegotiation of all the products that can hopefully have a better market access to Korea in an effort to also narrow the trade imbalance between the two countries.
Of course, it would have to be a win-win negotiation and the two negotiating parties have started the talks when we open it up last month. And intention is to have win-win agreement and hopefully giving more preference to products that can hopefully enter the greater way to the Korean market.
PH Exports & Investments
With this in mind, KOIMA’s buying mission is quite auspicious. Presently, the Philippines is the biggest supplier of bananas and pineapples in Korea. I am also aware that products like fresh mango, calamansi which is the Philippine lime, coconut water, virgin coconut oil, and banana chips are very popular with Koreans. However, I would like to encourage you while you’re here to discover the other products from the Philippines that you can bring back home.
For example, the Philippines is promoting food products for export to Korea like canned tuna, chicken, bananas, and dried fruits. We are also pushing for organic and natural products like food and health care products, as well as design-driven products like furnitures as well as garments and chemicals as well. For your consideration as well are electronic parts and components, and software and game development, among others.
I took note of the interests of the KOIMA companies here and I am glad to see that you represent a wide range of products. I am confident that during your business matching later this afternoon, you will meet the right companies from the Philippines as arranged by our DTI team. With your support, we hope to bolster our exports, which would generate more jobs and employment for our people. It would also help address the trade imbalance between our two countries.
Furthermore, we urge you to study the possibility of expanding your production facilities here in the Philippines. This would not only sustain Philippine exports to your country while integrating them into your value chains, it would also allow you to capture the Philippine market of more than 100 million. And considering our trade links to ASEAN, this would give you additional access to the ASEAN market of more than 650 million.
Among priority sectors that you can invest in are food production and processing, agribusiness, and manufacturing. Other sectors that may interest you would be those sectors involved in the BUILD BUILD BUILD — the finance and banking, infrastructure, tourism industry and real estate, among others.
FTA for Greater Trade
Your visit today is most opportune, given that the Philippines and Korea have begun negotiations of the FTA last month as I have mentioned. These negotiations herald the new chapter in the relationship of our two nations, borne on the back of our mutual interest for such an agreement.
In the Philippines, the FTA means we can achieve enhanced market access for our products and services. We also hope to find complementation in resources and industries that would create equitable balance of trade. For example, this FTA may enhance market access for our agricultural products into the Korean market. It could also help us establish an e-vehicle industry because the Philippines can support potential investments for example in the battery industry with its nickel and copper resources.
We have talked also in the e-vehicle industry last month in our visit. And we are now working on a program that can hopefully develop a manufacturing resurgence program for the e-vehicle, because we said that if we want to be big and to be a front runner in this industry, our government will have to give extra support – support beyond the usual fiscal and non-fiscal incentives. So our group is right now working on such program.
We are hopeful that our respective teams can complete the negotiation by November of this year. Technically, they have to be finish sometime September – in terms of negotiation, of the basic terms so that it can be ready for signature by November. I’m confident that KOIMA and Philippine exporters will benefit from this agreement once it’s concluded.
Start of JCTEC Talks
Last month, we also had our first meeting of the Philippine-Korea Joint Commission on Trade and Economic Cooperation (JCTEC). These activities signal the importance we accord to your nation as a major trade and investment partner.
During that meeting, Areas of Cooperation that could be implemented between the Philippines and Korea were presented and discussed. We also conferred on how we could best strengthen economic relations between our two countries.
The JCTEC is equally important as the FTA as it tackles the broader perspective of economic cooperation. Through this venue, we can push for greater trade cooperation and economic cooperation that can help KOIMA and Philippine exporters.
I was just also told by our Undersecretary that Korea has the FTA Academy. And of course this is one possible area of cooperation to cooperate on establishing an FTA Academy also in the Philippines.
Take Part in PH Growth Story
So we always say this, that it’s a good time always to take part in the growth story of the Philippines. The Philippines really continue to enjoy rapid growth average over 6% in the past 15 quarters and a very stable positive grow in the past over 80 quarters. And that shows that the Philippines is really well on his way to the upward growth trajectory.
More importantly, the sectors bumping this up would be manufacturing, construction, and all other industry as well as services. So it’s no longer dependent just on services but really even on the industry sector.
On the expenditure side, we see also the resurgence of the investment, capital formation side as well as the government expenditure in support of the BUILD BUILD BUILD so you would see double digit growth of this sectors that we look at the GDP feature.
More importantly, beyond this income GDP numbers would be how translates the people and we see the huge impact on the people. First, we’ve seen the poverty incidence from 27% to 21%. And Duterte administration is really looking at ending his term with 14% poverty incidence.
Also confirming those numbers would be the recent survey on self-rated poverty and the 38% is the lowest in its history. And that means that the people considered themselves less poor. And as we provide more job opportunities and income opportunities and business opportunities that certainly there’s nowhere to go to bring down this poverty incidence numbers.
Unemployment rate has also gone down to 5.1% that used to be over 6%. Underemployment has also gone down to 13% that had used to be over 19%. So these are very good indicators that really, the growth is leading to more jobs and more economic opportunities for the people.
And you know, one job that you create for a person it’s really actually helping that person and the family be lifted out of poverty. And this is really the essence of what President Duterte has been really pushing all of us to work on. Create all these opportunities for our people. All works come to how it impact to people and this is certainly the passion of everyone in the government to create all this income job opportunities so that everyone can be uplifted when it comes to their status in life.
Conclusion
In conclusion, expanding trade between our two nations will undoubtedly benefit everyone. We fully support your mission as this means more jobs and employment for our people, which would generate greater inclusive growth and shared prosperity. But we will also do our part to create a more conducive business environment in the Philippines. And our President has continuously assured all investors – protection on your investment and making sure that there would be Ease of Doing Business.
Our Anti Red Tape Authority has been working well and there’s a new Director General. So many complaints have been filed on them and were addressed. The people can feel that all these concerns on the Red Tape are now slowly getting to be addressed. And we are also working on aside from the continuously streamlining the processes, we hope to automate and really have an e-government capabilities in government so that we can really facilitate the Ease of Doing Business.
And all this is again is consistent with how the President would like the Filipinos to experience their life here. We don’t want to hear any complaints; we want to address their concerns whether you’re ordinary Filipino making life easy for you. No hassles. No long lines. But at the same time, if you’re also in business that there will be Ease of Doing Business. And definitely President assure all the investors that if there is a problem – there is a group, an office, a person, a government personnel making life difficult for you, just complain and he will allocate time to talk to you so that we can address the problem immediately. So with that, I wish you well and a great session today and tomorrow.
Magandang umaga po! Kamsahamnida.