What Products & Services Is The Philippines Buying From Russia?
Какие товары и услуги Филиппины покупает в России?
The Philippines is a popular light manufacturing, and tourism hub for foreign investors in Asia and the ASEAN region, which also includes Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Singapore, Thailand & Vietnam.
These countries enjoy free trade between each other, meaning subject to rules of origin regulations, production in one country can be exported, duty free, to the other. ASEAN also has Free Trade Agreements with China and India. This means, given the right circumstances, a Russian-owned manufacturing entity could export, duty free to these additional markets from the Philippines. This is especially true of the Philippines to Indonesia, which is just situated to the south.
The Philippines is of specific interest to Russian investors as it has also expressed willingness to negotiate a Free Trade Agreement with the Eurasian Economic Union. Research on the potential for Russian exporters and manufacturers to assess the Philippines market should be underway for Russian businesses looking to expand into Asia.
The Philippines is a good choice as a developing trade and services partner for Russia, it has a growing per capita income level of US$3,320, and a population base of 105 million. It is therefore a significant consumer market, with the additional benefit of being an ASEAN services centre. Statistics from DBS Bank on this can be found here and Euromonitor here.
It should be noted that the Philippines is also a popular outsourcing destination for English language online and call centre services, and has also signed a Free Trade Agreement with the European Free Trade Association which includes Iceland, Liechtenstein, Norway, and Switzerland. Russian investors in the Philippines can use this FTA to access these markets.
Current Russian trade trends with the Philippines are also on an upwards path, as we can see in these statistics courtesy of Trading Economics (figures in millions of US dollars) and grew steadily during the course of 2019.
It is worth noting that Russia also has a Double Tax Treaty with the Philippines, which if used correctly can reduce profits taxes for Russian entities based in the country. Professional advise should be sought.
In terms of exports to the Philippines, Russia currently sells a variety of products, ranging from oil and gas to fertilizers and automotive parts. A breakdown can be seen here.
It should be noted that there are Quality Control standards differences between Russia and ASEAN nations, and Russian exporters should be aware of these. We covered this in the article Quality Control Challenges For Russian Exporters To ASEAN.
Our practice, Dezan Shira & Associates, has offices in the Philippines, including Manila and Makati, and are familiar with the protocols concerning import/export and can advise on local market conditions. Please contact Maria Kotova at email@example.com for assistance both with local market intelligence and business plan development in addition to corporate establishment, tax advisory and on-going corporate compliance in the Philippines.
- What Products & Services Is Indonesia Buying From Russia?
- Business Opportunities For Russian Companies In ASEAN
During these uncertain times, we must stress that our firm does not approve of the Ukraine conflict. We do not entertain business with sanctioned Russian companies or individuals. However, we are well aware of the new emerging supply chains, can advise on strategic analysis and new logistics corridors, and may assist in non-sanctioned areas. We can help, for example, Russian companies develop operations throughout Asia, including banking advisory services, and trade compliance issues, and have done since 1992.
We also provide financial and sanctions compliance services to foreign companies wishing to access Russia. Additionally, we offer market research and advisory services to foreign exporters interested in accessing Russia as the economy looks to replace Western-sourced products. For assistance, please email firstname.lastname@example.org or visit www.dezshira.com