UK trade envoy: Brexit opens door to new era of trade with PH
MANILA, Philippines – The Philippines and the United Kingdom (UK) have been in the international spotlight for less than celebratory reasons: Brexit for the latter, and questions about extrajudicial killings for the former.
As far as the UK's trade envoy to the Philippines is concerned, these issues won't hinder the budding, and potentially hugely lucrative, trade partnership between the two countries.
Richard Graham, UK Prime Minister Teresa May’s trade envoy to the Philippines and Member of Parliament (MP), made the assessment following a joint lunch meeting between the British Embassy and the Makati Business Club in Makati on Friday, August 25.
The trade envoy flew to the country to drum up business support and to establish stronger ties with the new administration, through meetings with President Rodrigo Duterte, Trade Secretary Ramon Lopez, and prominent Philippine businessmen.
Graham was upbeat about improved bilateral trade between the two countries
“The trade is broadly balanced at the moment and I hope that will continue. I think there’s probably more demand in the UK for textiles and design from the Philippines than is currently recognized, and at the same time, there’s a good opportunity for niche UK SMEs to manufacture here or in partnership," he said.
He said that the UK "is more aware of the great growth of the ASEAN region as a whole and is looking in more detail into the individual countries in it and what can be done."
Opportunities from Brexit
Trade with the UK, of course, is anticipated to be complicated by Brexit, but Graham said that far from a hindrance, the exit from the EU is a good opportunity to expand relations.
Graham said he expects Article 50 to be triggered at some point in early 2017, signaling the official notice to exit the EU, but that in the intervening period, the UK can have informal discussions on the kind of agreements it would like to have after leaving the European Union.
“We’ve had some very good informal discussions already, first with President Duterte as well as the trade secretary. These were relatively broad meetings but there was enthusiasm on both sides to not just continue the relationships but to actually strengthen it," he said.
The Philippine trade chief agreed with the assessment, pointing out that “creating our own bilateral arrangements with [the UK] carries the advantage that of being able to focus on specific products and rather than taking into account the whole EU”.
Lopez added that the UK is a world leader in social enterprises and hoped that its enterprises would not only invest in that sector but also assist in developing local MSMEs.
The trade secretary also pointed to aerospace as another crucial area where the partnership can be furthered noting that the UK is global force with firms like BE aerospace already in the country.
“Our aerospace manufacturing sector has been growing continuously and we are particularly interested in securing more investments and technology transfers from the UK which is a global force in the industry,” he said.
Graham for his part also emphasized the fact that the flow of investment need not only be one way, noting that that since Brexit, there has been a surge of investment in the UK because the pound dropped in value.
“Effectively people who are buying businesses or goods are now able to buy them at 10%-11% cheaper than they were two months ago. So its kind of like an early Christmas sale if you like," he said.
That would also open the door, he said, for the leading Philippine firms to invest in the UK following the lead of firms like Monde Nissin.
“Ramon Lopez has just started as trade secretary and I just started as the trade envoy, so I hope this is the beginning of a beautiful relationship,” Graham said.
Bilateral trade between Philippines and the UK has picked up in recent years, growing by an average of 7% annually since 2010. Last year, overall trade grew by 28% to hit around 628 million British Pounds or $829.7 million.
Graham said what’s even more impressive is that the figure in terms of measurable goods and services is up by 38% – a remarkable achievement especially as the Philippines' overall trade with the EU dipped slightly last year.
Human rights issue
Graham doesn’t believe that negative perceptions on extrajudicial killings in the Philippine government's war on drugs would affect potential UK investments to the country.
“Human rights are important, make no mistake about it and they’re important for the Philippines as well as the UK, but its very important that the environment for business continues as it has done,” he said.
He continued: “The rule of law, as the President stressed, is the rule of law and sanctity of contracts is very important and opening up the doors for more foreign investment is a clear goal,” he said.
Graham added that UK businessmen will be most interested in the extra push for infrastructure through Public Private Partnerships outlined in the administration's 10-point socioeconomic agenda.
“That opens the door for UK infrastructure experts; master planners, architects, companies who have done lots of similar projects around the world and I think that along with the liberalization of foreign investment restrictions will be what businesses will most focus on,” he explained.
Graham described himself as a balikbayan to the Philippines, as he was based in Philippines as general manager of airline Cathay Pacific in the mid-1980s. – Rappler.com
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