Investments from the United Arab Emirates (UAE) may double by next year as the Philippines ratifies its Investment Promotion and Reciprocal Protection of Investments Agreement (IPPA) with the Middle Eastern country, according to the Department of Trade and Industry (DTI).
'The Secretary (Alfredo Pascual) was able to secure from the office of the president the ratification of the Investment Promotion and Protection Agreement,' Trade Undersecretary Ceferino Rodolfo said in a press briefing.
Rodolfo said the ratification, which was made by President Marcos on Nov.29, paves the way for the IPPA's entry into force as soon as the Department of Foreign Affairs (DFA) notifies the UAE side that the country has completed the domestic ratification process.
'On the part of the UAE, they were able to notify us early part of this year that they have gone through the domestic process. So within 30 days from the issuance of the DFA, the IPPA will be enforced,' Rodolfo said.
Pascual said the IPPA is a modern, business-friendly and comprehensive agreement that involves investment protection and facilitation, and features continued cooperation between both countries.
'I look forward to the implementation of the agreement, especially as both sides are exploring other possible investments and cooperation in areas like renewable energy, research and development, and skills development,' he said.
With the IPPA, Rodolfo said this would already significantly increase the investments coming from the UAE.
'We will see now that maybe by next year, investments coming from the UAE will double,' Rodolfo said.
'Since both sides have already undertaken their respective internal processes necessary for the effectivity of the agreement, it is now time to establish the Joint Committee on Investment for collaboration on investment areas of mutual interest to realize more UAE investments in the Philippines,' Rodolfo said.
Data from the DTI showed that net foreign direct investments from UAE amounted to $2.64 million in 2022.
BOI Governor and IPPA lead negotiator Marjorie Ramos-Samaniego said that with the ratification, the government's investment promotion efforts for the UAE is now in full swing.
Samaniego explained that the investment agreement provides for a rules-based framework for the protection, promotion and facilitation of investments from both countries.
'The agreement, which provides for national and most-favored-nation and fair and equitable treatment of investment, compensation for losses, guarantee against expropriation, and free transfers of capital, among others, was negotiated during the height of the pandemic, with the full support from our Inter-agency Committee on Investments namely, the Departments of Foreign Affairs, Finance, Justice and the Bangko Sentral ng Pilipinas. This demonstrates the firm resolve of both countries to bolster our economic ties,' she said.
Pascual said the implementation of the IPPA would pave the way for the Philippines to be a strategic hub for investments from the Middle Eastern region, particularly for priority sectors such as renewable energy, energy efficiency technologies, agribusiness, infrastructure, innovation, and information technology and business process management.
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