The Philippines and the United Arab Emirates (UAE) are headed towards unprecedented economic relations as the two countries concluded negotiations for the Investment Promotion and Protection Agreement (IPPA) and jointly announced to start official discussions on a Comprehensive Economic Partnership Agreement (CEPA) in February.
At the sidelines of the Philippines’ National Day at Expo 2020 Dubai on 11 February 2022, Department of Trade and Industry (DTI) Secretary Ramon Lopez and UAE Minister of State Ahmed Ali Al Sayegh recognized the signing of the start of negotiations for the CEPA and committed towards the eventual signing of the IPPA.
After the bilateral meeting, Secretary Lopez and UAE Minister for Foreign Trade Thani bin Ahmed Al Zeyoudi signed the joint statement formally announcing the intent to pursue CEPA.
This is an opportune time for UAE investors as the Philippines develops the necessary investment landscape through significant economic and regulatory reforms such as the liberalization of the Public Service Act, Retail Trade Law, Foreign Investments Act, the CREATE Act and the aggressive Build Build Build programs of the Duterte administration. These are supported by the Philippines’ efforts to improve ease of doing business by streamlining government processes, reducing processing time, and cutting bureaucratic red tape. The opportunities for FDI into several activities are broader and coupled with the IPPA, these investments will reap the benefits of all these reforms and agreements.
“The IPPA is modern, business friendly, and comprehensive, covering promotion, facilitation and protection of investments. The Agreement provides for the establishment of a Joint Committee on Investments (JCI), which will serve as a platform to more closely coordinate and collaborate in implementing a focused investment promotion that create greater impact to both our economies. I urge both sides to quickly convene so we can soon realize the objectives of the Agreement”, Secretary Lopez said.
To further maximize the opportunities for complementation in shared areas of interests and priorities, the Philippines and the UAE are also in the process of finalizing a Memorandum of Understanding (MOU) on Economic and Technical Cooperation, which, together with the IPPA, provides the solid foundation for pursuing the Comprehensive Economic Partnership Agreement.
“These initiatives are expected to boost trade and investments between two countries, leading to more diversified economic activities, development of new industries, employment generation, and higher consumer spending as we partner for shared prosperity. The Philippines may serve as a UAE’s strategic hub for the Southeast Asian region, as economic activities continue to shift to Asia. Active engagement between government and business sectors is key in ensuring that both countries will maximize benefits of the Agreements, including diversifying and expanding economic interests,” the trade chief continues.
The DTI Secretary was accompanied in the bilateral meeting by Senator Aquilino Pimentel III, Special Envoy of the President and Presidential Adviser on Foreign Affairs Robert Borje, Philippine Ambassador to the UAE Hjayceelyn Quintana, Congresswoman Julienne Baronda,
Congressman Christopher De Venecia, Congresswoman Stella Quimbo, Secretary of Agriculture William Dar, Secretary of Labor and Employment Silvestre Bello III, Presidential Communications Operations Office (PCOO) Secretary Martin Andanar, Acting Secretary of Public Works and Highways Roger Mercado.
Philippines ready for more UAE investments
The IPPA is an important pillar for realizing investment opportunities from the UAE, especially those that will tap into their sovereign wealth funds with combined assets of over USD1.6 trillion. Four of the world’s largest funds are based in the UAE, namely the Abu Dhabi Investment Authority, the Investment Corporation of Dubai, Mubadala Investment Company, and ADQ.
The UAE’s SWFs will benefit from investing in key sectors in the Philippines, such as agribusiness/agriculture, energy efficiency technologies/renewable energy, IT-BPM/shared services, manufacturing, oil and gas, processed and specialty food, tourism and hospitality, and real estate development.
The Philippines welcomed Letters of Intent from GCC companies during the Philippines Country Business Briefing held on the same day. These LOIs are expected to bring in USD600 million worth of investments and generate 4,000 job opportunities in the country’s healthcare, energy, tourism and hospitality, and dairy industries. (30)
