Philippines wants to open export zone with Taiwan

Jul 20, 2008, 20:45 GMT

Taipei - The Philippines wants to launch an export zone with Taiwan despite a lack of diplomatic ties, Manila's envoy to Taipei said in a newspaper interview published Monday.

In the interview with the Taipei Times, Antonio Basilio, managing director of the Manila Economic and Cultural Office (MECO), said that the Philippines wants to boost trade ties with Taiwan because of the two countries' geographical proximity.

Only about 100 kilometres separate Taiwan's southern tip and the Philippines' northernmost island.

'We are negotiating the establishment of an economic corridor that would link Taiwan's export zones with Subic and Clark export zones in the Philippines,' Basillio said.

'The idea is to create a virtual export zone, a seamless link between businesses in Taiwan and businesses in the Philippines. Within this virtual export zone, they could move workers and goods freely from one area to another, depending on demand and the requirements of the market.'

Basilio said that the Philippines is trying to promote itself as one a top outsourcing destination, because many Filipinos can speak English and are knowledgeable not only in customer services, such as call centers, but also in design, photo typing, accounting, medical transcription and other skills.

Tourism is another link that needs to be strengthened, Basilio said.

'Taiwan is now the fifth-largest source of tourists to the Philippines, while in the past Taiwan was the third-largest source, with as many as 250,000 Taiwanese visiting the Philippines each year,' he said.

To change that, the two countries must launch more flights and do more promotion, he said.

There are currently direct flights from Taiwan to Manila, Cebu and the tourist island of Boracay. 'We are working on flights to Clark, which is the hub for budget carriers going on to various parts of Southeast Asia,' he said.

Basilio invited Taiwan firms to invest in Philippine infrastructure projects including sea ports, operation of airports and telecommunications.

The Philippines cut diplomatic ties with Taiwan to recognize China in 1975, but it opened MECO as its de factor embassy in Taipei to handle unofficial ties with Taiwan.

Despite lack of formal ties, Taiwan and the Philippines have maintained close economic ties.

In 1994, former Taiwan president Lee Teng-hui made a private visit to the Philippines to discuss Taiwanese investment in the Subic Bay export zone, causing China to protest Manila's violating the 'one China' policy.

Currently, some 60,000 Philippine workers and 26,000 Filipino maids are working in Taiwan.