On March 6, Philippine Trade and Industry Secretary Gregory Domingo stated that rising labor costs in southern China are prompting large foreign manufacturers to relocate to the Philippines.
According to overseas media reports, Domingo indicated that Japanese investors have shown "particularly strong interest" as they seek land in Philippine economic zones, with investment areas including electronics, shipbuilding, and the steel industry. He mentioned that investors preparing to relocate to the Philippines also include some garment factories that are about to close in China.
Domingo noted that a large company that had previously left the Philippines has decided to return, and another company is also considering moving back to the Philippines. He stated that many investment delegations have already visited the Philippines for inspections.
Philippine officials have not estimated the scale of foreign investment or how many jobs foreign capital will create. Domingo also declined to disclose which companies are preparing to relocate to the Philippines.
Since the 1980s, China has implemented economic liberalization policies and has become the world's factory with low labor costs.
However, rising wages and increased production costs have diminished China's attractiveness to foreign manufacturers. Some Southeast Asian countries with still low labor costs are beginning to attract foreign investment.
In the first nine months of last year, the total amount of foreign direct investment in the Philippines exceeded $2 billion.
