Philippines calls for Chinese investment

A call for more Chinese investment in the Philippines was made by an official from the island nation on Wednesday.

This investment was needed especially to build roads and bridges, said Rogelio Singson, secretary of the Philippine Department of Public Works and Highways.

The Philippines has introduced a hierarchy system to attract foreign contractors, he said. This requires a minimum investment or equity capital of about $21.12 million for smaller projects and about $64 million for projects such as roads and bridges.

"It means smaller contractors in the Philippines could get small contracts and could also be involved in larger constructions. I know there are a lot of Chinese contractors who have that much equity capital," Singson said.

He said that in one group of projects, four out of six had been awarded to Chinese contractors, adding, "We welcome more Chinese investment, especially in roads and bridges construction."

Singson highlighted the importance of investment in connectivity building in his country.

The Philippines has increased its investment in infrastructure from about 1.8 percent of its GDP to about 5 percent to improve the quality and safety of roads and bridges and social services such as schools and hospitals, especially in rural areas.

Laurent Sinclair, a Pacific affairs research analyst, said there is still a disparity in the region's infrastructure development.

This is because such development is based largely on technical know-how, necessity and - perhaps, most important - foreign investment.

"As returns on investment are based on projects for a certain country's economic future over another's, this has created a hierarchy in the region, based on growth projections," he said.

Singson said the Philippines is focusing on three major infrastructure areas - roads and bridges, tourism and farm-to-market routes.

He said the country sees tourism as one of its major economic drivers and the improvement of farm-to-market routes as a key way to eliminate poverty by lowering logistics costs. Most of the country's poverty is found in farming communities.

"We hope foreign enterprises can set up their bases here in the Philippines so that they can attract more overseas Philippine workers to return and that more work can be done here as well as in the ASEAN (Association of Southeast Asian Nations) region," Singson said.

To boost regional infrastructure development, China has launched its Belt and Road Initiative and the Asian Infrastructure Investment Bank.