18 February 2021 via Zoom 

Ladies and gentlemen, good day! 

We would like to offer our warm greetings to the guests and participants of today’s business conference. We hope that everyone is keeping safe against the COVID-19 pandemic. We would also like to thank the organizers, the Philippine Chamber of Commerce and Industry (PCCI) and the Confederation of Indian Industry (CCI), for inviting us to be a part of this conference.  

We’ve always considered India as one of our strongest trade and investment partners. In 2020, you were the Philippines’ 14th top trading partner, our 13th top export market, and our 13th foremost import supplier. What’s more, you were our 15th top investment partner for 2019, with the same ranking as of January to September 2020. However, there are still many economic opportunities that have yet to be fully tapped for our bilateral relations to reach its full potential. 

Despite the pandemic, the Philippines and India were able to hold a virtual meeting of the 13th Philippines-India Joint Working Group on Trade and Investments (JWGTI) last year. During the meeting, both nations agreed to consider a possible Preferential Trade Agreement as a means to improve the current market access conditions for products of interest. More importantly, both sides discussed potential collaboration and cooperation initiatives on a wide range of areas—particularly infrastructure.  

The significance of infrastructure as a priority sector between both our countries was emphasized with the participation during the JWGTI meeting of Mr. Vivek Singhal, CEO of GRM Group. For everyone’s information, GRM Group has partnered with Megaworld Philippines to expand and modernize our Mactan – Cebu International Airport, as well as our Ninoy Aquino International Airport (NAIA).  

India was also encouraged to consider the opportunities in Philippine infrastructure and construction, given the complementarities in the sector. During the discussions, our Board of Investments (BOI) presented six Public-Private Partnership (PPP) rail projects under our massive “Build, Build, Build” infrastructure program. Meanwhile, the Philippines also conveyed its interest to participate in India’s port modernization and new port development projects under the Sagarmala and the Bharatmala Projects.  

To this end, we invite you to look into possible partnerships with local construction companies for the development of infrastructure and construction projects in India. We would like to point out that construction and related engineering services was our top export product in the ‘70s. As such, our companies have built and continue to build famous landmarks and structures globally. 

Like the rest of the world, the Philippine construction industry was heavily affected by the economic challenges wrought by the pandemic, declining by 26% last year as our GDP fell to -9.5%. But we’ve been seeing signs of economic recovery with the continued improvement of our GDP in the following quarters in 2020, from a record-low -16.5% in the 2nd quarter to -11.5% in the 3rd quarter and -8.3% in the 4th quarter. But like a rising tide, quarter on quarter, our GDP grew by 8% from 2nd to 3rd quarter, and 5.6% from 3rd to 4th quarter. 

What’s more, our National Economic and Development Authority (NEDA) estimate the contribution of the construction industry to our country’s GDP to reach as much as USD 1.3T by 2022. This shows that our construction industry still remains one of the best drivers for our country’s economic recovery and employment-generation with multiplier effect on jobs through business transformation and internationalization. 

We also continue to ease restrictions on foreign participation in the domestic construction industry to provide fair competition between local and foreign construction players, and encourage negotiations in accessing foreign construction markets. Easing restrictions likewise allows the transfer of knowledge and innovative technology from foreign construction companies to local players and stakeholders. 

In 2019, we also launched our Philippine Construction Industry Roadmap 2020-2030 (PCIR 2020-2030), which was crafted to further develop and grow the Philippine construction industry. This roadmap envisions a modern, efficient, future-oriented, and globally-competitive industry, increasing jobs generated from four million at the start of that roadmap to seven million highly skilled employees. 

And to facilitate greater trade and investment in the country, the Philippines is continuously pursuing reforms to foster a better business environment. For example, we have the game-changing Corporate Recovery and Tax Incentives for Enterprises Act (or CREATE) awaiting the signature of Philippine President Rodrigo Roa Duterte. CREATE will certainly encourage more investments with the lowering of the corporate income tax rate from 30% to 20% for Micro, Small, and Medium Enterprises (MSMEs), and 25% for large corporations. Modernizing the incentives system likewise makes the incentives such as Income Tax Holiday (ITH), Special Corporate Income Tax Rates (SCIT) or Enhanced deductions (ED) scheme, available to industries considered Strategic, Critical or export-oriented. 

Furthermore, given that India did not pursue its membership in the Regional Comprehensive Economic Partnership or RCEP, Indian businesses can still benefit from the mega free trade agreement through the Philippines’ own participation. Once it becomes effective, RCEP is expected to boost intra-regional investment and trade with ASEAN expected to play a vital role in this agreement.  

To conclude, as the Philippines and India continue to build stronger trade and investment ties, we hope that you will partner with us in pushing the Philippines’ economic recovery in the post-COVID future. Through jobs and employment generated by business and investments, our people can gain a more comfortable and higher quality of life as promised by our President Rodrigo Roa Duterte. 

Thank you and mabuhay tayong lahat. 

Date of Release: 18 February 2021