RP 9th in list of 12 emerging markets for UK investors

MANILA, Philippines - The Philippines ranked ninth among 12 countries picked as key emerging markets for global investors in 2009, according to new research published by UK Trade & Investment.

The survey, titled “Which of the following emerging countries are you considering to invest in the next few years,” listed the Philippines among 12 countries now favored by investors.

Last year, a similar survey was conducted among several countries and the Philippines ranked 23rd.

The British Embassy in Manila said UK Secretary of State Lord Mandelson revealed the findings of the new report at the Economist Intelligence Unit’s Emerging Markets Summit in London yesterday.

The report examines global business attitudes to emerging markets in light of the global downturn.

“The report we’re publishing today has a few basic messages. First, the basic conditions in the emerging economies are varied and not universal. China and India have continued to grow rapidly, although at less than the trend rate of the last decade. Other parts of the emerging world are also performing well relative to the rich world, but well below recent trends,” Mandelson said.

“On a more positive point, most of the 500-plus companies surveyed by the report are cautious about quick recovery but they were very positive about the long term potential of the emerging economies,” he added.

The survey found that 77 percent of companies expect the prospects for the global economy to improve in 2010-2011. 60 percent of companies surveyed expected to derive more than 20 percent of their total revenues from emerging markets in five years’ time – almost double the current figure of 31 percent.

However, political risk, including the risk of nationalization and expropriation, was cited by 50 percent of survey respondents as the greatest government-related obstacle to doing business in emerging markets.

In the Philippines, local and foreign chambers highlighted the need for continued reforms despite significant progress.

Despite the economic downturn, emerging markets support global profitability. Emerging market economies, on the back of the continued high growth and market size of China and India, have outperformed those of developed countries in 2009.

 “It’s clear that many British businesses have been able to hedge their recession performance thanks to a strong presence in the emerging economies. And they do see a long game in which WTO-membership and improving legal and commercial environments will make it easier to do business there,” he said.

British Ambassador Stephen Lillie said he was very upbeat about the Philippines as an exciting investor haven in Asia.

“The global recession was a wake-up call for companies to diversify their export base and seek out new opportunities in the emerging world. We are encouraging UK business to look to the Philippines and find new business in this exciting new market.”

The United Kingdom is the top net Foreign Direct Investment (FDI) investor in the Philippines, investing $298.17 million last year. There are currently around 200 British companies active in the Philippines, ranging from big multi-nationals to small and medium enterprises (SMEs).

President Arroyo delivered a keynote message during the Emerging Markets Summit in London yesterday. Over 300 business leaders and investors from all over the world participated in the forum, giving President Arroyo the opportunity to share the Philippines’ view on Asia’s leadership in the global economic recovery and to promote the Philippines as an investment destination.

Mrs. Arroyo highlighted the resiliency and continued growth of the Philippine economy, which posted 1.5 percent economic growth in the second quarter of 2009.

The President also said the UK has generously offered its assistance and support to the ongoing peace efforts in Mindanao, including sharing its own experience in securing peace in Northern Ireland.