Europe-PH News

The Americans, the Japanese and Chinese are still the top trading partners of the Philippines. But they may face tough competition sooner or later from Russia.

With oil as its major commodity exports, Russia may one day become our major trading partner. Fresh Philippine agricultural products are enticing to the Russians and the local produce could balance the trade with Russia.

American investors, though, are still pouring it on in the Philippines. American companies, for one, have invested over P413 billion in projects registered with the Philippine Economic Zone Authority (PEZA), cementing the United States’ position as one of the country’s largest and longest-standing investment partners.

PEZA director-general Tereso Panga said during last week’s 80th anniversary celebration of Philippines-US diplomatic relations, organized by the American Chamber of Commerce of the Philippines, that 249 US enterprises accounted for 12.4 percent of total investments approved by the agency.

The PEZA chief said the cumulative investments had generated more than 382,000 jobs, boosted exports and supported the country’s push toward upper-middle-income country (UMIC) status.

Major US companies operating in economic zones include Texas Instruments, Google, ON Semiconductor Philippines, JPMorgan Chase, Wells Fargo, Collins Aerospace and Coherent.

Panga said the Philippines and the US could further deepen investment cooperation through initiatives such as Pax Silica, the planned technology hub in New Clark City, and the Luzon Economic Corridor.

The projects are expected to attract high-value investments in artificial intelligence, electronics manufacturing services, semiconductor manufacturing services, digital infrastructure, research and development and green ore processing.

The Philippines and Japan, meanwhile, plan to conclude and sign a review of their landmark Japan-Philippines Economic Partnership Agreement (JPEPA) trade pact by November 2026, or 20 years after the initial agreement was signed.

JPEPA covers trade in goods and services, investments, intellectual property and economic cooperation. Agricultural products, particularly bananas, remain a vital component of Philippine exports to Japan.

Russia, though, is one economic power that the Philippines cannot ignore. The Philippines just last week promoted Cebu as a strategic entry point for foreign capital into the Philippines during the Moscow-Cebu Business Forum, part of a broader push to draw investors from Russia into the province’s economy.

Board of Investments (BOI) Cebu investment specialist Floreza Alpuerto outlined the country’s investment climate and government efforts to build a more competitive business environment. She made the pitch in an event organized under the “Days of Moscow in Cebu” initiative, marking the 50th anniversary of diplomatic relations between the Philippines and Russia.

“Cebu serves as a strategic gateway to the Philippine market, offering access to a skilled workforce, expanding industries and robust logistics connectivity,” Alpuerto said.

President Ferdinand Marcos Jr. cemented the Russian initiative when he visited Russia in June for a three-day working visit. The Russia-Philippine talks focused on food security, energy cooperation, trade and broader economic relations.

The Philippines is confronted with energy supply challenges and rising concerns over global commodity volatility. Oil, nuclear energy cooperation and trade were among the key topics raised during meeting with Russian President Vladimir Putin.  Manila, in particular, explored additional sources of energy and agricultural imports to bolster domestic supply chains.

The warming trade relations with Russia comes at the heels of the UMIC status earned by the Philippines.

The new status, according to the European Chamber of Commerce of the Philippines (ECCP) and the American Chamber of Commerce of the Philippines (AmCham), will strengthen the country’s investment appeal,

The World Bank’s recognition sends a strong signal to global investors at a time when multinational companies are reconfiguring supply chains, expanding regional operations and seeking new growth markets across the Indo-Pacific, says AmCham.

Many American companies view the Philippines as one of Southeast Asia’s most attractive investment destinations because of its young and skilled workforce, strong English proficiency, expanding consumer market and long-standing economic ties with US.

Philippine trade with Russia, however, should not take a backseat. The Philippines and Russia have maintained diplomatic relations for decades but the bilateral economic ties remain relatively modest compared with Manila’s trade relations with major partners in Asia, Europe and North America.

Russia and the Philippines should step up their efforts and start dealing with each other as major trading partners.