The Philippines declined by one notch to ninth place among the most attractive foreign destinations for Japanese investors in 2024, according to the Japan Bank for International Cooperation (JBIC).
In a March 21 publication, JBIC said its latest survey report on overseas business operations by Japanese manufacturing companies for Japan's fiscal year (FY) 2024 showed the Philippines' ranking switched with Malaysia among the promising countries for Japanese firms' overseas business over the medium term, or the next three years.
The share of firms that chose the Philippines also declined to 7.1 percent, or 25 out of the 351 Japanese companies surveyed in FY 2024.
In FY 2023, a higher 8.9 percent, or 35 out of 395 surveyed Japanese investors, included the Philippines among promising countries for their foreign business operations.
Malaysia overtook the Philippines in FY 2024, with 7.4 percent, or 26 firms, considering it a viable destination for overseas expansion, landing it in eighth place.
Besides Malaysia, ranked above the Philippines were India and Vietnam, which retained their positions in first and second place, respectively, followed by the United States (US), Indonesia, Thailand, China, and Mexico.
China slid three places from third position in FY 2023, causing the US, Indonesia, and Thailand to move up by one spot.
Mexico remained in seventh place, while Germany rounded out the top 10.
From seventh place in FYs 2019 to 2021, the Philippines fell to eighth in FY 2022 and maintained that position in FY 2023.
While JBIC's report did not indicate why the Philippines' ranking dropped in FY 2024, Manila Bulletin has learned that Japanese businessmen in the country are wary of rising incidents of crime targeting them.
Japanese investors are also awaiting up to ₱200 billion in pending value-added tax (VAT) refunds under the Corporate Recovery and Tax Incentives for Enterprises to Maximize Opportunities for Reinvigorating the Economy (CREATE MORE) Law.
JBIC's survey nonetheless showed that in the ranking of promising countries in the non-manufacturing sector, the Philippines ranked fifth, with 20.3 percent, or 14 out of 69 companies, choosing the country.
India led the pack among promising investment destinations for non-manufacturing firms, followed by Indonesia, Vietnam, and the US.
Also, 10.9 percent of 284 Japanese investors identified the Philippines as one of the countries or regions where they would strengthen or expand their business, ranking 12th.
The Philippines ranked behind the US, India, China, Thailand, the European Union (EU), Vietnam, Indonesia, Malaysia, Taiwan, Mexico, and South Korea.
JBIC's FY 2024 survey was conducted from July to September last year. Japan's FY 2024 started in April 2024 and ends in March 2025.