BWorld 815, On investment promotion and world peace

On investment promotion and world peace

August 19, 2025 | 12:02 am

My Cup Of Liberty

By Bienvenido S. Oplas, Jr.

https://www.bworldonline.com/opinion/2025/08/19/692278/on-investment-promotion-and-world-peace/

 

Last week, the Philippine Statistics Authority (PSA) released the data on approved foreign investments for the second quarter (Q2) of 2025. I checked and compared Q1 and Q2 2025 results over the same period in 2024.

 

The Board of Investments and the Philippine Economic Zone Authority remain the country’s largest investment promotion agencies (IPAs) and there has been a significant decline in total foreign investments, from P345 billion in 2024 to P95 billion in 2025.

 

The largest sources of investment last year were Switzerland with P235 billion and the Netherlands with P40 billion. This year the largest sources are Singapore and South Korea (see Table 1). 

 

The bulk of the foreign investments last year were in the Electricity, gas, and steam sector with P282 billion out of the P345 billion total, followed by Manufacturing with P25 billion. As to the destination of foreign investments, the bulk went to Calabarzon with P123 billion and Negros Island with P86 billion. This year, the Bicol region got P32 billion of the total P95 billion, followed by Calabarzon with P25 billion.

 

The past two weeks showed the President and some members of the economic team busy with various investment promotions. President Ferdinand R. Marcos, Jr. and several Secretaries were in India and among the events held there was the Philippine-India Business Forum in Bengaluru, on Aug. 7.

 

Department of Finance (DoF) Secretary Ralph G. Recto was among the speakers in that forum and he said that: “The Philippines is the natural hub for Indian companies in IT, fintech, blockchain, AI, and BPO looking to expand their operations in Southeast Asia.” There were around 160 Indian investors from key sectors such as IT-BPM, manufacturing, infrastructure, and healthcare, among others.

 

On Aug. 13 in Manila, Mr. Recto met with the officials from the Sumitomo Mitsui Financial Group led by its President and Group CEO Toru Nakashima who expressed their confidence in the Philippines. And on Aug. 14, Mr. Recto also met with the US-ASEAN Business Council (US-ABC) members, led by its Senior Vice-President and Regional Managing Director Ted Osius, and discussed recent investment liberalization measures.

 

The Philippines is not as attractive a destination as many of its East Asian neighbors when it comes to getting foreign direct investments (FDI), partly because of our geography, poor infrastructure including power generation, and governance. Two decades ago, in 2004, the Philippines had an FDI inward stock (instock, cumulative for FDI inflows minus outflows yearly) value of $12.7 billion. This rose to $56.6 billion in 2014 and $125.5 billion in 2024 (see Table 2).

 

A number of East Asian nations have had modest FDI instock because they transformed into net exporters of capital. In 2024 Taiwan had instock of $148 billion but outward stock (outstock) of $532 billion. South Korea had instock of $287 billion but outstock of $763 billion. And Japan had instock of $220 billion but outstock of $2,151 billion. China is quickly transforming into net exporter of capital, its outstock was only $883 billion in 2014 but expanded to $3,118 billion in 2024, an increase of $2.24 trillion in just one decade.

 

Foreign investors always partner with domestic investors, suppliers, and contractors. Hence, FDI expansion means domestic investment expansion, more jobs created, more taxes collected, and more infrastructure projects funded.

 

One good thing going for us is that the Ukraine war will end soon. The Trump-Putin meeting last Friday in Alaska resulted not just in a ceasefire plan but a peace plan. Not just a temporary halt to the war but ending the war. Ukraine’s President Volodymyr Zelensky will meet with US President Donald Trump in Washington DC on Monday, and if he agrees with the Trump-Putin agreement — and he likely will because there are big costs to him if he does not — a formal peace plan can be announced by the three leaders as early as this week.

 

Countries and governments should focus on peace and prosperity and not war mongering. They should focus on commerce, investments, and tourism, on more cargo ships not battleships, on more commercial planes not fighter jets, on more trucks and backhoes not more battle tanks. All conflicts, especially those related to territorial disputes between and among neighbors, should prioritize diplomacy and de-escalation, not escalation of conflict.

 

Last week, Aug. 14, marked the 80th year of Japan’s surrender and the end of World War 2, although Sept. 2 is the official date of the end of the war. Humanity has progressed over 80 years of having no world wars. We should push for 90 years, 150 years, or longer of having no world wars. More investment and trade among countries is an important aspect of this goal.