PEZA is aiming to start discussions this year and plan the technicalities on how to get BIMB-EAGA to become more active
by DASHVEENJIT KAUR / pic by ISMAIL CHE RUS
The Philippines aims to revive the Brunei, Indonesia, Malaysia and the Philippines-East Asean Growth Area (BIMP-EAGA) by next year to increase trade and investment within the subregion.
The Philippine Economic Zone Authority (PEZA) DG Charito Plaza said the agency intends to speak to the leaders of the respective nations on reviving the 24-year-old subregional economic cooperation in the first quarter of next year.
“We are aiming to start discussions this year and plan the technicalities on how to get BIMB-EAGA to become more active for the benefits of all the periphery regions,” she told reporters at the press conference of the Philippines Investment Forum 2018 in Kuala Lumpur yesterday.
Plaza said the Philippines urges for a discussion by this year, so that a summit among the four nations can be held in the first four months of 2019.
“We know each nation is in need of the other to accelerate economic growth, hence, we look forward to holding a BIMB-EAGA summit next year,” she added.
BIMP-EAGA was launched in Davao City, the Philippines, on March 24, 1994.
The region comprises the sultanate of Brunei; the provinces of Kalimantan, Sulawesi, Maluku, West Papua in Indonesia; Sabah, Sarawak and the Labuan Federal Territory in Malaysia; and Mindanao and Palawan in the Philippines.
“BIMP-EAGA has had its ups and downs over the last two decades, but a revival will accelerate economic development in areas that are geographically distant from their national capitals, yet in strategic proximity to each other.
“The Philippines’ focus will be on Mindanao as it is the poorest province in the country and requires new investments, Plaza added.
Malaysian Deputy International Trade and Industry Minister Dr Ong Kian Ming (picture) encouraged Malaysian companies to invest in Mindanao, especially in infrastructure projects.
“These periphery regions are actually ideal for companies from China and the US to relocate, and help improve the logistics amid the trade tensions between them,” Ong told reporters on the sidelines of the forum.
Developments in BIMP-EAGA will also improve the economic growth of East Malaysia as opportunities lie ahead for Sabah and Mindanao on the back of possible trade diversions.
“As a trade-dependent country, Malaysia foresees there will be a diversion of capital into Asean as well.
“Asean countries should work together to attract foreign direct investment (FDI) from China and the US into the region,” Ong added.
In his keynote address, Ong urged Asean countries to work together to develop attractive investment packages for foreign investors intending to relocate or invest here.
Malaysia and the Philippines have a high dependency on trade and both are integrated into the regional and global supply chains, according to Ong, and thus, these countries are exposed to the ramifications brought by trade conflicts.
“Our businesses should look into how we can make Asean into a cohesive unit to take advantage of this trade diversion happening because of the US-China trade war.
“There are many opportunities for us to co-invest and make this region a strategic hub in Asean so that we can export to markets like China and the US,” he added.
Ong noted that there is vast potential for Malaysia and the Philippines to work together to expand economic relations.
“Our governments and the private sector can reap the benefits of stronger regional growth by adopting strategies to strengthen business linkages and expand collaborative initiatives,” he said, noting that in 2017, bilateral trade between both nations grew by 26.1% year-on-year (YoY) to US$5.94 billion (RM24.59 billion).
Malaysia’s net investment to the Philippines increased by 360% YoY to US$13.78 million in 2017 and was ranked the second-largest investor in the Philippines among the Asean countries with an FDI of RM196 million.
Malaysian investments in the Philippines are mainly in infrastructure, manufacturing, call centres, palm oil, hospitality, and information and communications technology.
“Some of our notable companies who are currently operating in the Philippines, include Resorts World Hotel, Shangri-La Hotels and Resorts, Malayan Banking Bhd, Mitra Energy Philippines Ltd and AlloyMtd Group,” Ong said.
The minister said Malaysian companies could explore the halal services sector such as halal restaurants and halal food franchising business in the Philippines.
“I encourage the Philippine business community to set up operations in Malaysia, especially in designated halal parks,” he said.