Taiwan firms seeking to steer clear of US-China trade war turn to Philippines

A bilateral investment agreement between the Philippines and Taiwan had helped the country's case in getting these Taiwan-based companies to consider the Philippines.
A bilateral investment agreement between the Philippines and Taiwan had helped the country's case in getting these Taiwan-based companies to consider the Philippines.PHOTO: ST FILE

MANILA/BEIJING (THE PHILIPPINE DAILY INQUIRER/ASIA NEWS NETWORK, REUTERS) - Some Taiwan-based manufacturing companies that supply parts to popular tech firms such as Apple are interested in setting up shop in the Philippines, as they look for ways to avoid the United States-China trade war.

Philippine Trade Undersecretary Ceferino Rodolfo said this earlier this month, telling reporters that some companies were already firm in their plans to manufacture here in the Philippines.

A bilateral investment agreement between the Philippines and Taiwan had helped the country's case in getting these Taiwan-based companies to consider the Philippines.

These firms include computer giant Wistron Infocomm, which will make a comeback nearly a decade since it left the Philippines, a return brought about by the US-China trade war.

Taiwan-based Catcher Technology, which also has operations in various parts of China, is likewise interested to set up shop in the Philippines.

Mr Rodolfo said the company was looking for a 60ha area for its facility. Further details, such as investment costs, were not disclosed, however.

The bilateral investment agreement signed by the Department of Trade and Industry with Taiwan in 2017 had played a part in attracting Taiwan companies to the Philippines.

 
 
 
 

"We enhanced (our relations) to a bilateral (investment) agreement, which was signed last year. So they saw this, and we also have protection for intellectual property rights," Mr Rodolfo said.

"They see that it's good here in the Philippines, so Wistron - that's one (example) - is going (back) to Subic," he explained. This is how the Philippines benefits from the trade war, he added.

The bilateral investment agreement, however, had caused concerns in Beijing, as it says that Taiwan has no right to diplomatic recognition because it is part of China.

Speaking in Beijing, Chinese Foreign Ministry spokesman Geng Shuang had said that China had no problem with normal trade relations other countries had with Taiwan, but opposed any kind of official exchanges, according to a Reuters report on Dec 8.

"We are extremely concerned that the relevant Philippine department signed with Taiwan investment protection agreements or other cooperation documents that are obviously official in character," Mr Geng told a daily news briefing.

China hopes that the Philippines sticks to the "one China" principle and avoids having the Taiwan issue damage relations between Beijing and Manila, Mr Geng added.

China and the Philippines have largely mended relations that were strained over a territorial dispute in the South China Sea following the election of Mr Rodrigo Duterte as president in 2017, Reuters reported.

However, Taiwan and the Philippines have also traditionally had close business and cultural ties, despite Manila severing its formal diplomatic relations with Taipei in 1975.