RP-German chamber drafting road map for bilateral trade

MANILA, Philippines - The German-Philippine Chamber of Commerce and Industry, Inc. (GPCCI), a 44-member group formed last March, said in a press conference Wednesday that it is drafting a road map for developing bilateral trade, which hit P189 billion in 2006. "There’s a lot of room for improvement in bilateral trade. The chamber aims to facilitate dialogue between [the countries’] stakeholders, key agencies and organizations," chamber president Franz Roland Odenthal told reporters. He said the Philippines remains on the radar screen of German businessmen, but the country needs to curb corruption and improve physical, political and education infrastructure to help improve investor sentiment. Physical infrastructure, particularly good roads, railways, ports and airports; and education infrastructure, particularly improved skills and knowledge in the engineering, business administration disciplines, are vital to attracting more German investors, Mr. Odenthal said. Political infrastructure, meanwhile, pertains to stable and competent government policies. For instance, German investors said they remain committed to investing in the Philippines despite delays in the opening of the Ninoy Aquino International Airport Terminal III (NAIA III), which is the subject of a local and international legal battle over compensation between the government and Fraport AG. The German government decided last April to pay Fraport AG €41.9 million under the federal government’s investment guarantee program, in this case covering its troubled investment in NAIA III. A Fraport statement that time quoted executive board chairman Wilhelm Bender as saying that "The unlawful behavior of the Philippine government will not pay off. We will not accept the expropriation done and we will get our money back for our engagement in the Philippines." Mr. Odenthal said "they [German businessmen] need to be assured that it’s safe to invest hereThe country’s image also remains a concern." He also cited a number of upcoming German investments in the country’s energy, business process outsourcing, tourism and maritime industries but declined to be more specific. "Germany always considers the Philippines when it comes to investments in Southeast Asia, but infrastructure may be an obstacle," Mr. Odenthal said. Gunter Matschuk, GPCCI first vice-president, said the country’s image abroad had greatly improved but added that "with a broad sectoral presence in power generation, automotive and tourism, among others, the chamber also identifies the need for a focused public representation to bring industry concerns forward." Germany is the Philippines’ 6th largest foreign investor with businesses in major industries such as technology, pharmaceutical, airlines, shipping, logistics and consumer goods. German exports amounted to €1.1 billion, or P73 billion, in 2006, consisting largely of machinery, aircraft, chemical and pharmaceutical products, while Philippine exports of mainly office machines and electronic goods to Germany hit €1.9 billion, or P126.1 billion, that same year. In terms of development aid, Germany said the Philippines remains a priority country, with Germany having granted over €556.8 million, or P37 billion, for financial cooperation and €262.5 million, or P17.42 billion, for technical cooperation in 2006. Priority areas of German-Philippine development cooperation are economic reform and the establishment of a market economy, support of health sector reform and population management, as well as environment and resource management, including the promotion of renewable sources of energy. - Bernardette S. Sto. Domingo, BusinessWorld