It is reported that Japan is allotting $2.2 billion to incentivize Japanese companies to move out of China and transfer their factories back into their country or to a good alternative. These companies will start looking for the most favorable country to host their manufacturing facilities and Philippines is not the top investment destination choice. I think any foreign company will look to relocate to a country that possesses the following advantages: a) stable government, leaders that serve their country with dignity and loyal purpose, b) tax incentives or reasonable and fairly simple tax schemes, c) generally lower cost of doing business– taxes, electricity cost, salaries and wages, d) ease of doing business, less red tape and bureaucracy, policies must be consistent, f) advance telecommunication services such as reliable high speed internet, g) Educated and proficient in English work-force, h) peace and order, safety and security of their company officials, i) good infrastructure for efficient and stable supply chain of raw materials and supplies, j) friendly or liberal business environment.
The top two choices are Vietnam and Thailand.
Japan wants to reduce their reliance on China and the perception of how the Philippines manages its response in addressing the pandemic also plays a role in their decision to move or not their factories to our country.