The Philippines is becoming a favored investment destination for large multinational companies that hope to expand and diversify their manufacturing operations worldwide, according to an official of investment banking giant BofA Merrill Lynch. He cited rising factory costs in China as one of the reasons behind the trend.
BofA Merrill Lynch's New York-based executive vice chairman for international corporate and investment banking James Quigley, said in a press briefing that currently there is greater transparency and a higher fundamental comfort level in doing business in the Philippines.
He added that because of the country's centralized location in Asia, its highly regarded free democracy that works, its historical close ties with the United States of America and its strong demographics the Philippines is considered an attractive place to move manufacturing operations.
Quigley also said that if the Philippines continues doing the right thing, its share of foreign direct investment (FDI) flows will also increase. He added that he feels "very strongly" that as multinational corporations look to move labor-intensive manufacturing operations to emerging markets, the Philippines can become the preferred destination of those foreign direct investments.
Corporate leaders around the world, according to Quigley, were becoming "uniformly comfortable" with the Philippine government's actions. Investors were also encouraged by the country's sound local banking system, more equity and fixed capital formation and public fiscal sector surpluses. Manila is also logistically well situated in the region. Demographics point to more potentially beneficial situations and trends: an expanding middle class, increasing need for significant investment in infrastructure and the growing number of world class multinational corporations that are based in Manila.
The BofA Merrill Lynch official added that there is real growth locally and more people are focusing on demographics, on local policies, political stability and the success of the democracy and local policies.