Mindanao, particularly the Muslim region, is seen as the next possible business destination as areas begin to open up with the signing of the Bangsamoro peace plan but basic structures need to be in place to entice ventures into the resource-rich area.
Speakers in the “Connection, Cooperation, and Commerce for Peace and Development in Muslim Mindanao” forum held on Dec. 13 said infrastructure and the need to understand culture is important as firms begin to think about expanding the Autonomous Region of Muslim Mindanao (ARMM) – the future Bangsamoro.
The forum, organize by the Eisenhower Fellows Association of the Philippines, the ARMM government, and think tank Brain Trust, Inc., aimed to gather interested groups that are eyeing investments in the region.
“There is significant potential and renewed hope that fosters trust in investors. Ayala historically had a presence in Muslim Mindanao so there is space for Ayala to aggressively expand. We need to encourage capital flows there built a level playing field must be established.” Said Ayala Corp, Chairman and Chief Executive Jaime Augusto Zobel de Ayala in his keynote speech.
He said Muslim Mindanao “needs soft and hard infrastructure including roads and telecommunications lines because of lack of it makes it difficult for businesses to locate.”
Legitimate institutions and functional bureaucracies are also needed.
“There is little development without security and at the same time security cannot happen without development. Legitimate institutions must be built and the private sector is key for that. Investors also need input from people in the area so the private sector can coordinate with the government,” said Motoo Kinishi, World Bank country director.
He added risk assurance facilities must also be offered to businesses planning to invest in the Bangsamoro region.
In addition, businesses have been encouraged to study local cultural practices and even work with local companies and institutions to ease into the market.
“You cannot transplant a Metro Manila business model to the ARMM as we experienced with our banks so you need to be very familiar with the culture,” said Mr. Zobel relating that banks in the region rely less on loans to generate revenue.
For one, the Sharia law, the legal code of Muslims, prohibits the payment of interest on debt.
Firms that have been successful in the region have forged partnerships with local government units to enhance business potential.
Meanwhile, areas in which business may invest include tourism, housing, agribusiness and infrastructure.
HSBC Philippines Chief Executive Wick A. Veloso, on the sidelines of the same event, said, “We are very interested to find out what are the business opportunities in Muslim Mindanao, primarily because we have a lot of customers overseas and we should be in a position to advise them regarding the opportunities in the Philippines.”
Foreign business groups such as the European Chamber of Commerce of the Philippines have also cited the potential of the region for investors. - E.N. J. David
Sources: Business World; Special Feature; 17 January 2013
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