Cebu gets first German “big-ticket” investment

CEBU, Philippines - With the current stronger relationship between the two nations, Germany will continue to be a significant economic partner for the Philippines in the years ahead, particularly in the fields of trade, investment and tourism.

This was according to Michael Hasper who is the Deputy Head of Mission and Charge d’ Affaires of the Embassy of the Federal Republic of Germany in the Philippines who graced the inauguration of the office of Daimler Group Services Philippines, Inc. at Creativo IT Center II Building along Mindanao Avenue in Cebu Business Park last Saturday.

The Cebu-based shared service center of the German manufacturer of premium passenger cars commercial vehicles and trucks shall provide services and consultancies in the areas of financing and accounting to Mercedes Benz sales organizations and other Daimler subsidiaries in Africa, Asia-Pacific, Europe and Germany.

Hasper said that the opening of the first office of the Daimler Group in the Philippines signifies the proof of trust in the country that has posted an upswing in terms of its economic performance. He said that this could be considered as the first German “big-ticket” investment in Cebu.

“The Philippines works hard to achieve a strong economic performance and to develop the trade agreement with Germany and we could see that German companies are venturing into fresh investment trends in the country. The growth opportunities and diversification of the Philippine economy, specifically in terms of human services and infrastructure, do not go unrecognized to Germany. There is much more to come,” he said.

He emphasized that the dynamic partnership of both countries is evident with the increase of bilateral trade volume of Germany and Philippines to 3.8 billion euros worth of exports and imports last year.

He cited that Germany imports electronics, of which majority are semiconductors, agricultural products and consumer goods like furniture from the Philippines.

Germany is considered to be the biggest export market for Philippine goods in Europe. Philippines, on the other hand, needs exports from Germany when it comes to machinery, electronics, and chemical products.

“Germany has trade deficits so we import more from the Philippines than Philippines import from us,” Hasper said.

He said that the gross domestic product of Germany is mostly accounted for by exports from other countries, adding that globalization is considered to be the “key to success” of the German economy.

“German companies are always on the lookout. Our economy and enterprises are looking at the world to look for investment opportunities and markets where we can sell our products. Globalization which is the key element in our economy brings countries together to negotiate on the spot,” he said.

He cited that there is an estimate of 100 to 150 German companies in the Philippines.

Early this year, Finance Secretary of the Philippines Cesar Purisima went to Germany to sign the revised bilateral double taxation agreement (DTA) with the German Federal Ministry of Finance that is expected to facilitate bilateral trade and investments.

Both countries have agreed on the adoption of new standards in the tax treaty which is designed to provide further protection against the risk of double taxation wherein the same income is taxable in the two nations.

Meanwhile, Christof Wegner who is the commercial counselor of the Republic of the German Embassy to the Philippines said that tourism is another growth opportunity of the Philippines to attract more Germans coming into the country.

He cited that the key drivers for the Philippine tourism include diving, eco-tourism, white sand beaches, and new tourist activities.

He suggested that the Philippines has to develop the eco-tourism industry in the country and make it more sustainable. He said that most Germans are actually more interested with eco-tourism which is currently gaining ground and the use of eco-source materials such as renewable energies.

“Germans are looking for new destinations with unspoiled natural beauty and they are willing to pay premium for that kind of tourism,” Wegner said, adding that German tourists feel safer to travel far in groups and avail of tour packages.

Hasper then advised the Philippines to invest on the infrastructure of its airports in order to further boost its booming tourism industry.

He described Germans who come to other regions to travel as special type of tourists since an average German tourist often goes to Europe and neighboring countries which are nearer and more accessible. /JMD (FREEMAN)