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than the tax breaks, market leader Toyota Motor
Philippines (TMP) reminded the government that it is the
predictability and consistency in the policy environment
that will make investments flow into the country.
“That
[consistency] is every businessman’s dream. That is why
others are going to countries such as
Thailand
and Vietnam,” Dr. David Go, TMP senior executive vice
president, told the BusinessMirror.
Go said
they are really concerned that the initial proposal of
the Board of Investments (BOI) to remove auto assembly
from the list of activities that will be eligible for
full government incentives under the new Investment
Priorities Plan (IPP) will derail the plans of Toyota’s
mother unit to continuously expand its manufacturing
operations here.
“It will
really affect us. Investments for the assembly of a new
model will probably not be considered anymore,” he said.
Go said
the government should reciprocate the growing confidence
of investors in the country by not tinkering so much
with policies that have made them put up stakes here in
the first place.
He said
taking an activity in and out of the IPP from time to
time is a major turnoff because investors hate
inconsistency in investment policies.
The BOI,
Go said, should understand the situation of the
industry, where new projects go through a three-year
planning stage.
Auto
assembly has been eligible for full perks—topped by
income-tax holidays and duty-free importation of
equipment and raw materials—in the last two years as it
is included in the priority sectors.
While
TMP already celebrated its new milestone of producing
400,000 units of vehicles last week, Yuji Takahashi, TMP
Comptrollership Division head, said the achievement is
nothing compared with Toyota’s subsidiary in Thailand,
which already manufactured 10 times more than that of
the Philippines.
Takahashi said the
Thailand
unit opened just about the same time TMP started
operations but the Thai government has been supportive
of the growth of the auto industry there, which made the
big difference.
Unlike
the Philippines, Thailand protected its domestic
industry from imported competitors through tariff
barriers, Takahashi said.
He said
the Philippines, with a market smaller than Thailand,
“is already very open.”
Takahashi said they have no problem with liberalization
as long as the government would help the industry become
more competitive. |
