Vol. XXII, No. 196 [ BusinessWorld Online ]
Friday, May 8, 2009 | MANILA, PHILIPPINES
BY CARMELITO Q. FRANCISCO, Correspondent
DAVAO CITY — The Agricultural department is planning to establish a special economic zone in Mindanao for Saudi Arabian investors.
Agriculture Secretary Arthur C. Yap said the department will "explore" this proposal, which he said was among the issues Saudi investors have asked the government to address.
"They want a sense of security, so what we are thinking of is setting aside a special economic zone for them," said Mr. Yap who accompanied a 26-member Saudi Arabian trade mission exploring the potentials of the island.
Mr. Yap said he will discuss the issue with the Philippine Economic Zone Authority, the agency that approves any application for an economic zone.
Saudi visitors were convinced of Mindanao’s potential as an investment haven, considering the region’s comparative advantage in agricultural production as its soil is suited for farming high-value crops, while its weather conditions are favorable for healthy crop yields, Mr. Yap claimed.
He pointed out, however, that some members of the Saudi delegation expressed reservation over the land reform system since it opens up the possibility that investors could be eased out before they recover their investments.
"I have to (explain) that this is a social commitment of the government to our people," he said.
The visitors also had queries on a constitutional provision that restricts foreigners from owning land, Mr. Yap said.
Fahad A. Bal Ghunaim, Minister of Agriculture of the Kingdom of Saudi Arabia and head of the delegation, said the Saudi government is looking for areas where it could invest in food production. King Abdullah, he added, had also persuaded Saudi’s private sector to invest outside the kingdom.
"Definitely, the Philippines represents an opportunity for investment," he said during a brief program at this city’s Apo View Hotel. Among the food subsectors presented to the Saudi delegation where additional investments are required are poultry, cattle raising, banana production and rice production.
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