The American Chamber of Commerce and Industry said Friday American investments in the Philippines will stay but business expansion plans are on hold due to “back to back” uncertainties.
Chamber senior adviser John Forbes said in breakfast forum in Makati City that President Rodrigo Duterte’s pronouncements of economic separation of the Philippines from the US had “rattled American investors.”
“Investors want investment stability in a country so expansion of investments are expected. I see no withdrawals of investments but a slowdown or delays of expansion projects,” he said.
Forbes, however, said Duterte’s message was taken out of context. His Cabinet members later explained that Duterte did not mean severance of ties but more of a “diversification of relationships and that means that American investors are still welcomed in the Philippines.”
Forbes said the second uncertainty was US President Donald Trump’s policy to bring back all American businesses back to the US, especially those in the services sectors like business process outsourcing and the US decision to withdraw from the economic alliance Trans-Pacific Partnership.
Trump earlier announced plans to bring back jobs to the US by banning US companies outsourcing jobs and talents abroad and urging manufacturers to return to the US.
He also announced other protectionist policies like the renegotiation of the North American Free Trade Agreement with the intention of imposing tariffs on American products entering the US market.
Trump negotiated for the drafting of a bill on anti-offshoring to bring back call center jobs to the US. Majority of the BPOs operating from the Philippines are American companies.
Forbes declined to identify which industries may delay their investment plans. He cited a recent report showing IT-BPO companies were putting on hold expansion activities due to Trump’s protectionist policy that threatens to penalize any offshoring activities.
BPO firms, he said, could be getting cautious because of the perception that the Philippines might not be a reliable place to go to.
Forbes remains optimistic that despite an apparent miscommunication on both sides, the bilateral economic activities would continue because of the strong US-Philippines ties.
The Trump administration, he said, should realize that 95 percent of consumers of American products were overseas and only five percent were from America.
“Hopefully, US policies elsewhere in Asia, including the Philippines, will not change radically,” he said.