PCCI AVP Rene Simbulan and BCCI President Violy Luna joined the Philippine delegation that attended the 18th Joint Meeting of the China-Philippines Business Council and the Philippine-China Business Council on SME Partnership and Development last October 18-20, 2004 in Taipei.

Minister Ho Mei-Yueh of the Ministry of Economic Affairs delivered his keynote speech with DTI Sec. Purisima, PCCI President Noemi Saludo as head of the Philippine delegation. Minister Ho highlighted the complementary characteristic of the industrial structures of the Philippines and Taiwan. Taiwan is the fourth biggest source of foreign direct investment to the Philippines, with a bilateral trade value of USS4.5B in the first eight months of 2004. In both countries, SMEs comprise 97% of all firms nationwide and employs 70% of the labor force, thus contributing 30% of total business revenue. SMEs are collectively the major force behind economic growth.

Taiwan is promoting the "Go South" policy in investments, which prioritizes Southeast Asian countries as investment locations for Taiwanese business and avoiding over-concentration of investment in mainland China. Under this policy, incentives are provided to encourage firms to invest in Southeast Asia, and the Philippines is one of the favored investment destinations under this plan.

The Taiwan experience emphasized the need to attain political and social stability, timely implementation of effective economic policies, and vigorous private entrepreneurship as key factors to development.

Dr. Robert S.Q. Lai, Director General of the Small and Medium Enterprise Administration further suggested the need to consider the adoption of an export-oriented strategy and to select a group of strategic industries as priorities for government support and promotion. The government should collaborate with civic organizations for promotion of foreign trade, thereby helping companies access international markets. The exchange rate should be kept stable to promote savings and thereby turn savings to productive capital. Start-up capital with reasonable equity and management assistance of start-up enterprises are likewise important.

Minister Ho suggested the strengthening of relationships between the CPBC and PCBC and to expand the production networks and supply chains between enterprises in the two countries. Positive results are expected to be achieved under this collaboration.