New Zealand, Philippine ties stronger at 50

Trade commissioner Hernando Banal II. (L) and Manila-based New Zealand ambassador David Strachan.

It's been half a century since New Zealand's diplomatic relationship with the Philippines began, and both countries are reporting a friendship in great shape - with new aviation links bringing us even closer together.

"I think the political relationship with our two countries is in excellent shape... In the last five to seven years there has been an enormous increase in people-to-people contact," said New Zealand ambassador David Strachan.

Filipino-born New Zealand trade and enterprise commissioner Hernando Banal II, who has previously spent time in New Zealand as an overseas Filipino worker (OFW), said the countries' relationship had come a long way.

"In my experience - 15 years ago - not many Filipinos would have known where New Zealand is," Banal said. "During that time if you mention Anchor milk or Anchor butter then they would suddenly connect that to snow-capped mountains, green fields, meadows and the dairy industry to New Zealand - that was before.

"As well as back in New Zealand during the early years when I first immigrated, Kiwis didn't know much about the Philippines," he added.

This is now changing, said Banal thanks to the Internet, globalisation and a certain Kiwi film series.

Tourism

Strachan said he expects Philippine-New Zealand ties to grow stronger following Air New Zealand's announcement to fly direct to Manila, starting this December.

"The thing to watch now is the nonstop air services which will have a springboard effect to inject greater momentum into the relationship," he added.

Tourism between the two countries has reportedly risen 25 per cent over recent years.

Business networks

There are now 20 established and active Kiwi companies operating in the Philippines including Datacom, Steel Pencil, Fonterra, Griffins and Goodman Fielder.

Banal said the Philippines was a great option for Kiwis wanting to gain entry into the Asian market.

"The business language here is English and the culture is very western-friendly, so a lot of New Zealand companies are realising it's a good opportunity to expand in to Asia."

It is estimated that around 2,000 Kiwis are living in the Philippines.

"...The Philippines is a very strategic gateway to Asia as it is located in the middle of East Asian and South East Asian economies like China, Japan, Korea, Singapore, Thailand and Vietnam."

An increasing number of Kiwi companies like Steel Pencil and Datacom are using the country for back-office operations for global customers, Banal said.

"We have Steel Pencil and Datacom they are here riding on the BPO wave that is flourishing in the Philippines," he said. "These are New Zealand owned companies who are expanding their operations of production capacity by doing their back-office productions in the Philippines."

The Philippines is a very strategic gateway to Asia as it is located in the middle of East Asian and South East Asian economies like China, Japan, Korea, Singapore, Thailand and Vietnam.

Over the last couple of years there have been two major investments from Philippine companies in New Zealand.

"One was the acquisition of Griffins by Universal Robina Corporation, that was a purchase of about NZ$730 million and addition to that, First Pacific brought Goodman Fielder for about NZ$1.4billion," Strachan said.

"That's also very promising that dynamic businesses here [in the Philippines] see New Zealand as a land of opportunity - their investing in our country and creating jobs and using the New Zealand brand to enter other markets in the ASEAN region.."

Business development between the Philippines and New Zealand is also on the rise.

Over the next 10 years Strachan and Banal said they expect to see more New Zealand labels and brands in Filipino supermarkets including more confectionery, frozen meats and Kiwi wines.

Collaborations outside of distribution, dairy, healthcare and construction sectors are next on the cards.

What we're good at in the world is governance and our models of governance - sustainable development of fisheries, what we do in terms of qualifications and food safety, business registration, vocational training - these are all things that are of interest to Filipinos.

New Zealanders and Filipinos currently work closely in geothermal, dairy, healthcare and construction sectors, but Banal said he expects to see more Filipinos in the ICT and construction sectors in New Zealand in coming years.

"There has been a big jump in the number of construction workers coming from the Philippines and I can see also the ICT sector taking in more 'overseas Filipino workers' (OFWs)."

In terms of other sectors with potential for collaborations, food safety and governance are likely candidates, Strachan said.

"What we're good at in the world is governance and our models of governance - sustainable development of fisheries, what we do in terms of qualifications and food safety, business registration, vocational training - these are all things that are of interest to Filipinos.

"Regulators in New Zealand and the Philippines over the years have got to know each other pretty well and that's the best way to sustain trade that is business friendly," he said. "If you've got regulators talking to each other and addressing genuine concerns, not tariff barriers, it's going to be much better."

Trade

Two-way trade between New Zealand and the Philippines is worth $1.3 billion per year including services.

New Zealand imports horticultural products from the Philippines including bananas, pineapples, mangoes and electrical appliances and exports dairy, meat, forestry products, confectionery and wines to the Philippines.

In 2014 trade relations between New Zealand and the Philippines had increased by 6.4 per cent to a total revenue of $553 million.

Trans-Pacific Partnership

When asked whether the Philippines would benefit from joining the TPP along with New Zealand and 11 other countries, Strachan said the Government would welcome the move.

"It's a question for the Philippines, should it determine at some stage that they wish to join the TPP, New Zealand's position is clear; we practice and adhere strongly to the concept of open regionalism."

Filipino Presidential frontrunner Rodrigo Duterte, who will be welcomed in to Congress as the new president in June, is reportedly a fan of the Trans-Pacific Partnership.

Strachan said he sees the ties between the two countries strengthening over the next five to 10 years.

"The only way is up from here at the moment, there are no real impediments, political or economic in the relationship," he said.

"Looking into the crystal ball, I'm pretty upbeat."

Ten years ago the two countries did not really "know" each other, Strachan said.

Joint participation in a number of trade-related agreements such as the ASEAN economic community and Asia-Pacific Economic Cooperation (APEC) has enabled the countries to prosper and "grow together".

"...The feedback I get from New Zealand businesses and local businesses alike is that there has been significant improvements of government issues in the private sector and reduction of red tape [in the Philippines]."

Overseas workers

Aside from work opportunities, New Zealand's environmental conditions make the country an attractive option for Filipinos looking for a holiday or to immigrate.

Overseas Filipino workers, or OFWs as they are called in the Philippines, refer to Filipinos working and living abroad but still contributing to their economy.

"If you ask Filipino's now what attracted them to New Zealand, they will say nature and the outdoors and then they will say Hobbiton and Lord of the Rings, and of course the kind and welcoming people," Banal said.

"I can attest to that. New Zealanders are generally very welcoming to visitors," he added.