Ambassador to the Kingdom Antonio P. Villamor has underscored the existing excellent ties between the Philippines and Saudi Arabia as the Filipinos celebrate their 111th Independence Day anniversary today.

“The bilateral relationship binding the two countries —political, economic, education and culture — could not have been better in the past than it is now,” he told Arab News.

He said that the warm relations between the two countries have been ushered in by the series of the exchange of bilateral visits and the continuing expansion of trade.

On the political side, President Gloria Macapagal Arroyo visited the Kingdom in May 2006 and met with the Custodian of the Two Holy Mosques King Abdullah bin Abdulaziz. Arroyo requested for a continued oil supply and the release of Filipinos in different jails in the Kingdom.

Within hours of her arrival in the Philippines, some 188 former Filipino detainees arrived in the Philippines from Saudi Arabia.

“As a result of the visit, some 500-600 former Filipino detainees in the Kingdom were pardoned and sent home to the Philippines,” Villamor said.

In the economic sector, the ambassador noted the increasing visits between the Philippines and Saudi Arabia.

“Business visits between the two countries increased last year not only in numbers. The visits were also high profile from both sides, which were focused on major economic and investment issues,” Villamor said.

The visit last February by no less than President Arroyo highlighted the promotion of trade and economic relations during her meetings with Minister of Trade Abdullah Alireza and Agriculture Minister Fahd Balghunaim.

“The visit was a huge success indeed. It generated commitment by the Saudi government to seriously consider investing in agricultural projects in the Philippines, particularly the growing and production of rice, corn, sugar, banana and other essential agricultural products,” Villamor said.

Present during the meeting were Philippine Trade and Industry Secretary Peter B. Favila, Agriculture Secretary Arthur Yap, and other high-ranking cabinet members.

As follow through to the fruitful visit of Arroyo, a top-level Philippine halal food selling mission also visited the Kingdom on April 24-29, 2009. Comprising 20 members from the private and public sectors, the mission was headed by Dr. Thomas G. Aquino, senior deputy minister of trade and industry.

While the mission promoted halal food, it also generated a joint investment collaboration for the production of halal food in the Philippines, particularly in Mindanao where labor is cheaper and production technology is highly competitive.

One of the projects proposed to the Saudi private sector is the establishment of a Halal Food Industry Economic Hub in Marilog District, Davao City. Under the Special Economic Zone Act of 1995, this and other similar projects may be applied for conversion into an agri-industrial zone through the Philippine Economic Zone Authority (PEZA).

The incentives of PEZA-registered Agri-industrial Zone include:

1. Four years income tax holidays

2. Exemption from export taxes, wharfage dues, impost and fees

3. Tax and duty free on importation of machinery and equipment

4. Exemption from export taxes, wharfage dues, impost and fees

5. Exemption of payment of local government fees

6. Zero Value Added Tax (VAT)

7. Special Investors Visa

8. Employment of foreign nationals

9. Simplified import and export procedure.

The delegation met with major chambers of commerce and industry in the Kingdom where business meetings were also organized. Leading Saudi businessmen and traders likewise held one-on-one discussions with the members of the delegation. They also met with Saudi food importers in Riyadh, Dammam and Jeddah.

To step up initiatives to advance the realization of their investment commitments to the Philippines, a top level Saudi Agro-Investment Mission comprising 26 members also visited the Philippines last May 5-10. It was headed by Agriculture Minister Balghunaim.

The delegation met in a business forum with key officials and members of the Philippine Chamber of Commerce and Industry (PCCI), including leading businessmen in the agriculture sector.

Other business sectors in the agriculture sector were also represented in the forum held at the Manila Peninsula Hotel. The Saudi delegation visited Davao in the south, where they met Mindanao-based business leaders in agriculture in a similar business forum organized by Mindanao Business Council.

Business leaders from the Autonomous Region in Muslim Mindanao also attended the business forum. The Saudi delegation also made an aerial tour of the various areas suitable for agri-business ventures. The delegation expressed interest in the production of rice, meat and poultry, and fish including the growing of other agricultural products.

In 2008, there were also notable business leaders who visited the Philippines to explore trade and investment opportunities. These visitors included Sheikh Mazen Batterjie, vice chairman of the Jeddah Chamber of Commerce and Industry; Sheikh Khalid Zainy of the Abbar and Zainy Group and Mohammad Al-Kholi of the Al-Kholi Group who is keen on establishing real estate development projects in the Philippines such as hotels, beach resorts, and other tourism infrastructures. The Kholi Group is also eyeing to embark on remittance business.

Filipino exporters, encouraged by the huge market in the Kingdom bolstered by the presence of large Filipino community, are preparing to further expand their export to the Kingdom.

This has been encouraged by the steady improvement of the Philippine export performance in the market in recent years.

“The Philippine Embassy in Riyadh and the Trade Investment Center at the Consulate General in Jeddah are promoting the export of Philippine products to the Kingdom,” he said.

He added that the missions have been aggressively pushing for the exports of Philippine halal food, furniture and other wood-based products, fashion accessories and other leather goods, gift items, home décor and handicrafts, agriculture and marine based products, health and wellness products, garments and textiles, vehicle spare parts, among others.

Villamor said that to further strengthen the export drive, more Philippine outbound business missions covering wide product range will be visiting Saudi Arabia. “These business missions are expected to be in the market later this year. Similarly, major trade fairs and exhibitions are also being lined up in the Philippines, catering to major exports products,” he said.

More Saudis are expected to attend this year on account of fresh trade and investment promotion initiatives from both the Philippines and the Kingdom,” he said.

Latest statistics showed that the total two-way trade between the Kingdom and the Philippines reached $4,398,361.017 between January and November last year, up 22.44 percent from $3,592,330.460 the previous year.

The balance of trade, however, is still in favor of the Kingdom which is the largest supplier of oil to the Philippines.