The Philippines and South Korea will sign on Monday agreements envisioned to further strengthen overall ties between the two countries.
South Korean President Lee Myung-bak, who arrived in Manila on Sunday afternoon, will officially begin his state visit with a wreath-laying ceremony at the Rizal Shrine in Luneta before proceeding to Malacañang for a meeting with President Aquino.
The two leaders are expected to discuss, among other things, trade and investment opportunities, and tourism, Deputy Presidential Spokesman Abigail Valte said in an interview over dzRB, the government radio, on Sunday.
"There are many tourists from South Korea who come to the Philippines. We also have common interests in trade and investment. We know that the Republic of Korea is our development partner, particularly in agriculture and infrastructure, so we expect the flow of discussions to go around the topics that were mentioned," Valte said.
Filipino businessmen are hoping the state visit would result in a joint communiqué with South Korea in the form of an accelerated version of an economic partnership agreement (EPA).
The joint communiqué should outline initiatives that will further the exchange of trade, investments and people between the two countries, said Donald Dee, vice chairman and treasurer of the Philippine Chamber of Commerce and Industry (PCCI).
"We don't need to negotiate an EPA with Korea because we are already linked in several areas and we already have the Asean-Korea Free Trade Area [AKFTA]. We no longer have barriers when it comes to tariffs and manufacturing. We only need to have a joint communiqué," Dee told the BusinessMirror.
The document, Dee said, should focus on non-tariff barriers, investments, services and a mutual recognition agreement.
Currently, the country's EPA is with Japan. On a regional basis as part of the Association of Southeast Asian Nations (Asean), however, the Philippines has free-trade agreements with Japan, South Korea, China, India, Australia and New Zealand.
Based on the study of the Universal Access to Competitiveness and Trade, which serves as the PCCI think-tank, Dee said merchandise trade between the two countries increased rapidly since the forging of the AKFTA in 2007. Exports to South Korea are up 23 percent and it is now the eighth-largest trading partner of the Philippines.
South Korean investments, on the other hand, went up from less than $100 million in 2007 to $600 million in 2010. Among the top South Korean investors in the Philippines are Hanjin Heavy Industries and Construction, Samsung Electronics Philippines Manufacturing Corp., and Daelim Industrial Co. Ltd.
On the tourism side, Dee said Koreans make up 22 percent of the total foreign visitors to the Philippines.
With the existing complementarities economically and socially, Dee said the Philippines and South Korea could skip the tedious part of negotiating an EPA and proceed to the forging of a joint communiqué.
"We only need to list down all our matching industries and then reconcile our ambitions and expectations," Dee said.
The joint communiqué, he said, should state that South Korea and the Philippines will work together to enhance the economies of both countries.
The two countries will then separately outline their respective commitments on how their ambitions will be achieved in the areas of trade, investments, services and mutual recognition for the practice of professions.
Coinciding with the visit of Mr. Lee, a former CEO of Hyundai Engineering and Construction, the government has arranged a meeting between the PCCI and the South Korean business delegation at the Manila Hotel on Monday, which the South Korean leader will keynote. President Lee flew in at 1:30 p.m. on Sunday accompanied by his wife, Kim Myun-Ok.
Apart from his Palace engagements, Mr. Lee will also attend a town hall meeting at the Ateneo de Manila University before returning to Malacañang for a state dinner in his honor.
He will depart Manila on Tuesday morning.
