Why the Philippines may miss out on a potential new wave of foreign investments

As many businessmen await how the US-China tariff negotiations play out, economists are one in saying that if the trade war persists, the Philippines stands to benefit from it. 

Exporters who may be hit by high US tariffs are already assessing countries or territories where they may have to relocate if US President Donald Trump’s high-tariff regime is upheld by courts, which will mean more expensive imported goods for those who live in America.

This could potentially lead to a new wave of foreign investments from enterprises looking to relocate to countries where Trump has imposed low tariffs, which include the Philippines. 

Unfortunately for the Philippines, it appears we’re shooting ourselves in the foot — again. 

At least two countries have raised concerns with the Philippine government over what appears to be a worsening peace and order situation under the Marcos administration.

For instance, one of the issues raised in a recent bilateral meeting between Foreign Affairs Secretary Enrique Manalo and Japanese Foreign Minister Takeshi Iwaya on May 28 in Japan was the peace and order situation in the Philippines.

“Minister Iwaya stated that, in light of the recent security situation in the Philippines, the safety of Japanese nationals residing in the Philippines is essential for promoting investment, and that he strongly hopes for improvements in the security situation in the Philippines,” according to a May 28 press release of the Japanese Ministry of Foreign Affairs. 

“In response, Foreign Minister Manalo explained that the matter is being handled at the highest level and that the Philippine government will make every effort to ensure the safety of Japanese nationals, whether they visit for business or tourism.” 

Among the recent incidents that raised alarm in Japan that was brought to Rappler’s attention involved an armed robbery in a Japanese restaurant on Pasay Road, Makati City on May 4. 

Two armed men wearing helmets suddenly entered the restaurant while customers were eating. They took the customers’ valuables, such as cash and cellphones, and the incident was caught on CCTV and went viral. What made it peculiar was that one of the gunmen returned the cellphones but kept a wallet that had P25,000 in cash, according to various news reports.

And, it’s not just the Japanese who are alarmed over an apparent rise in criminality against foreigners.  

The South Koreans have also raised the same concerns with the Philippine government. 

In a meeting on May 22, Korean embassy representatives met with various Philippine government officials regarding the safety of Koreans in the Philippines.

“The representatives from the Korean Embassy initiated the meeting with accounts of the more recent incidents involving crimes and organized criminal activities committed against South Korean nationals in the Philippines. The representatives sought immediate action and greater support from the Philippine government to prevent future occurrences of such incidents. The cases mentioned included a robbery and attempted murder case reported on the 7th of May 2025, and a separate incident which took place on April 21, 2025, in Angeles City, Pampanga,” according to a May 25 statement from the Presidential Anti-Organized Crime Commission. 

In the Angeles City incident, a Korean was shot dead after he was robbed near a bank in the city’s Korean town. Here’s how Korean network MBN or Maeil Broadcasting Network reported the incident in a news program.

In an incident that happened in May, two Koreans were reportedly robbed of their expensive designer bags and cash in upscale 9th Avenue in Bonifacio Global City, an area that had been considered safe.

Government officials vowed to step up security of Koreans and other foreigners, and said the suspects were also involved in robbery incidents in Pampanga. They said the suspect had been apprehended. They also vowed to step up security of Koreans by improving the Tourist Security Desks in the country and deploying more CCTV cameras. Koreans have been the number one foreign visitors to the Philippines for several years now.

Chinese community

Even earlier than the Japanese and Koreans, the Chinese community in the Philippines, via the Movement for Restoration of Peace and Order, has expressed concerns over recent incidents, such as the killing of businessman Anson Que and his driver by their kidnappers, as well as the kidnapping of a Malaysian-Chinese student in an international school in Taguig City in February this year. The student was rescued by police but the kidnappers slightly severed his right pinky finger to press the family to pay ransom.

“We are one with the public in calling law enforcement authorities to step up, take urgent action, and put up a stop to these senseless acts of violence. We have three cases in just five weeks,” said the civic group in April. “We call on agencies of government to take swift and decisive action to restore peace and security.” 

Lookback

Recall that the Philippines largely missed out on the big wave of Japanese investments in the ’80s due partly to the high-profile kidnapping of Nobuyuki Wakaoji, Manila manager of Mitsui Corporation, after playing golf in Canlubang Golf Club in Laguna in November 1987, days after then-president Cory Aquino returned from a visit to Japan. 

And then, in the nineties, Taiwanese investors looking for alternative destinations with lower production costs, mainly skipped the Philippines as kidnappings became a major problem for the Fidel V. Ramos administration.

Among the major kidnap-for-ransom cases were those of Chinese-Filipino students Kenneth Go and Myron Uy Ramos (both killed in September 1992), and high school student Charlene Sy (killed in January 1993). Taiwanese investor Jack Chou was kidnapped in May 30, 1993 in Sucat, Parañaque and paid P10 million in ransom in Hong Kong.

“The kidnapping menace wreaked havoc, not just in the lives of its victims but also on the Phiippine economy. The economic dislocation caused by the businessmen who opted to close shop and move elsewhere, by the victims whose families moved out of the country, and by domestic investors who shelves their plans for expansion, cannot be quantified. Compounding the problem is the capital flight and the hesitancy of foreign investors to come in due to the hostile business climate,” wrote Chinese-Filipino community leader Teresita Ang See, in a paper presented in September 1993 and published in the book, China,Taiwan, and the Ethnic Chinese in the Philippine Economy. 

The last Social Weather Stations (SWS) survey on families victimized by common crimes, conducted in September 2024, saw an increase to 6.1% in September 2024, 2.3 points higher than the 3.8% in June. Street robbery and break-ins also slightly increased from June. 

If the Philippines doesn’t get its act together on this critical problem, we might end up missing out on a new wave of potential foreign investments — again. – Rappler.com