This was the assurance given by Robert Sears, AmCham director for external affairs, in an exclusive interview with the Philippines Graphic.

The 109-year-old association is a wily survivor of feudal Philippine politics, stamping its presence during the heydays of the American colonial period and maintaining its grip on the nation’s business and economic life long after the declaration of Philippine Independence in 1946.

AmCham outlasted the Marcos dictatorship, waded through three Edsa People Power uprisings, and tackled with dexterity the idiosyncrasies of the administrations of former Presidents Fidel V. Ramos, Joseph Estrada, Gloria Macapagal-Arroyo and now, President Aquino.

Initiated in 1902 and incorporated in 1920, AmCham is the oldest American chamber anywhere in the world and the first of its kind to be organized in Asia.

Since its creation, the organization has held offices in various sections of Manila—at Plaza Lawton, Sta. Cruz and Escolta, later moving to Kalaw Street in Binondo and, last, in 1984, to the Corinthian Plaza on Paseo de Roxas.

Beginning with little more than a hundred members, AmCham has steadily grown over the years, peaking at over 700 members in the late 1980s, until it plateaued to the present number of 620 members. About 90 percent of its current members are firms; the remaining 10 percent are individuals.

 

No links with CIA

It is not surprising, therefore, that most of the local big business players and big lobby groups have maintained close links with AmCham. These include the Employers Confederation of the Philippines (Ecop), Philippine Chamber of Commerce and Industry (PCCI), Philippine Association of Multinational Regional Headquarters (Pamuri), Makati Business Club (MBC), Management Association of the Philippines (MAP), Financial Executives Institute of the Philippines (Finex), and other trade and business organizations.

AmCham officials are quick to point out, however, that they have no links with the US Central Intelligence Agency (CIA) despite a recent allegation by arrested WikiLeaks founder Julian Assange that many American business groups are working with the CIA.

“No, never, we have our own work,” said Sears, who laughed out loud when asked in jest about their possible CIA connections.

Which is not to say that the American business bloc does not engage in politics. In 2009 it lobbied against the bill of then-House Speaker Prospero Nograles that sought to limit the number of casual and contractual employees that foreign-owned companies can hire.

Amcham, along with PCCI, Ecop and MAP, considered the outcome of their efforts a victory. The bill failed to reach second reading. No new or old version of the bill has been refiled this year in Congress.

 

Mum on RH

With regard to the controversial Reproductive-health bill, AmCham chose to adopt a moderate stand and refused to comment on whether it is for or against the RH bill that Congress still has to enact into law. It has, likewise, opted not to say anything on the proposed across-the-board salary-increase bill now pending in the House.

Controversies and political scandals notwithstanding, Sears maintained the view that the Philippines is still the best place for Americans to do business in Asia.

The AmCham official admitted that most of their members make huge profits in the country. The Philippines has a big market, owing to its growth rate of 2.3 percent per year and is strategically located in Southeast Asia, he added.

Most important of all, Sears said, Filipinos are easy to get along with and are fast learners, with good command of the English language.

 

Second to none

“Filipinos are second to none,” said Sears, a former US Air Force captain who fought in the Vietnam War from 1966 to 1970. He stressed that even during the most turbulent phase of the Marcos dictatorship, none of their members packed up to relocate to Vietnam, Indonesia, or Malaysia.

“In my 31 years in the organization, I only know one firm that packed up—FedEx—because its operations is really suited in China, that’s why it now holds its regional office there,” Sears, Amcham president in 1988 and 1989, said.

Perhaps, proof of the huge profits American companies make in the Philippines is the fact that at least 10 of the AmCham member-firms that landed on Forbes magazine’s top company list have regional offices in the Philippines.

These are Citibank, Procter and Gamble, Coca-Cola, McDonald’s, Colgate-Palmolive, JPMorgan, Texas Instrument, Chevron, Convergys and GN Power. “They all made it big here, so why go to other countries?” Sears said.

 

‘Culture of bribery’

For all the billion-dollar profits realized in more than half a century of doing business in the Philippines, AmCham said there is still much room for improvement insofar as the trade and investment relations between the US and the Philippine is concerned.

“There is too much bureaucracy [and] red tape, and the Philippines is quite protectionist,” Sears said, without batting an eyelash.

He also mentioned the “culture of bribery” in the Philippines that American firms learned to deal with in order to expedite the release of documents and business papers.

He added that all American companies doing business in the Philippines are covered by the Foreign Corrupt Practices Act, a US law that punishes American firms that resort to bribery in doing business.

 

Filipino barriers

“The Philippines is moving too slow. This country reformed slowly than most Asian countries. Many of its laws and regulations are no longer in tune to the present setup,” the 67-year-old Sears explained.

If it were up to AmCham, what some Filipinos regard as the “nationalist” provisions of the Philippine Constitution or Philippine laws would be repealed as soon as possible for being “irritating and out of tune” with the times. These provisions include the 60-40 division of any foreign-owned company in the country; the barring of foreign businessman from owning land; and the disallowing of foreigners to enter the retail-trade business in the country.

“Remove these barriers, and one day you will wake up like Malaysia. It’s strict for bad business but wide open for foreign direct investments,” Sears said.

Malaysia, according to Sears, opened its economy in the last 25 years. The
result made the country the second most developed nation in Southeast Asia, he said.

Sears also detailed “other problems” they encountered while doing business in the country. These are the “too high minimum wage, high cost of electricity, lack of infrastructure, and unstable peace and order or security, especially in many provinces in Mindanao.”

 

US profit formula

The AmCham official said their organization was “confident toward the Aquino administration.”

“People are beginning to realize that his mission is noble and aims to straighten up the economy. Even his Cabinet must be given credit as it has the same idea. One-track mind as we observe, and that is what this country needs,” Sears said.

Thinking like a veteran foreign investor on the lookout for more profits, Sears appealed to the country’s lawmakers to institute further reforms. He said these reforms should include opening further the economy to foreigners, especially in the mining sector.

In the eyes of the AmCham, the country’s current banking laws are biased toward local banks. Laws on banking in the Philippines should be relaxed to promote reciprocity in doing business, Sears said. “We don’t mean to become nosy. It’s still up to them if they want to hear us.”

“Foreign banks here are limited only to several branches. Why can’t foreign banks be allowed to open more so that the opportunity will be equal? In a way more jobs can be created by that policy,” he said.

Under the General Banking Act signed shortly after the new Bangko Sentral ng Pilipinas (BSP) was created in 1993, foreign bank branches in the Philippines, like Citibank, are limited to six.

In a text message, Nestor Espenilla, BSP deputy governor for the supervision and examination sector, said AmCham’s observation on limited branches of foreign banks in the country is “too general to comment on.”

“That’s the law. But if it’s a locally incorporated foreign bank like Citibank Savings, same privilege as local. It’s their call. The rules are fair enough,” Espenilla told the Philippines Graphic.

AmCham said it remains very bullish about the Philippine economy and identified seven core industries that would soon make it big if given the needed push and support. These industries include agribusiness, business outsourcing, creative industries, infrastructure, mining, manufacturing and tourism.

According to AmCham, agribusiness would fare well since the Philippines has one of the most fertile lands in the world.

Business outsourcing (call centers) will prosper because Filipinos have superb speaking skills and are very good in diction.

Creative industries and infrastructure are likewise seen as having good development potential because of the number of qualified engineers, architects and artists the country has produced over the years.

Foreign investors have expressed interest in exploiting the country’s mining resources that they said have been largely untapped because of the existing limitations in the Constitution concerning foreign ownership of land.

Similarly, foreign businessmen regard manufacturing and tourism as two areas that could generate considerable jobs for millions of unemployed and underemployed Filipinos.

“The Philippines has tremendous opportunities to grow because of its God-given resources. That is our fearless forecast. We’ve been here for over a hundred years, and we will stay here to witness our expectation for your country,” Sears said.

 

Reprinted from the June 27, 2011, issue of the Philippines Graphic

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In Photo: American Chamber of Commerce executive director Robert Sears welcomes representatives from AmCham members.

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