1. 1 Philippine-Korean Relations: Today and Tomorrow 28 Feb 2008 (KOSAP, Asian Center, U.P.- Diliman) by Hong Sungmog Minister (DCM), Korean Embassy

2. 2 Contents I.Diplomatic and Consular relations II.Economic relations III.Development cooperation IV.A Prognosis

3. 3 I-1. Diplomatic/Consular Relations: ‘The Philippines’ to the Koreans For the Koreans, the Philippines… 1.gratefully sent troops during the Korean War 1.gratefully sent troops during the Korean War 2. was looked upon as “the Asian Cinderella” in the 1950s and 1960s when Korea was dirt poor 2. was looked upon as “the Asian Cinderella” in the 1950s and 1960s when Korea was dirt poor

4. 4 3. is a place to learn English most economically. 4. is ‘geographically’ (by flight) the 3 rd nearest country, after Japan and China - 3.5 hours to Manila; but - 6 hours to Bangkok/Singapore/KL/Jakarta

5. 5 Map of East Asia

6. 6 I-2. Diplomatic/Consular Relations: Diplomatic Exchange - 1949: entered into diplomatic relations (Korea became independent in August 1948); - 1954: mutually established permanent missions (Legations); - 1958: both Legations were upgraded to ‘Embassies’

7. 7 - In the last 40 years, five of the 6 Korean Presidents visited the Philippines (Park CH, Chun DH, Kim YS, Kim DJ and Loh MH; Roh TW was the exception); and - In the last 15 years, all the Philippine Presidents (Ramos, Estrada, Arroyo) visited Korea.

8. 8 I-3. Diplomatic/Consular Relations: Tourist Arrivals In 2006 and 2007, Korea was the biggest source country for the Philippine tourism industry. - Arrivals by nationalities (2007) shareincrease shareincrease 1. Korea 653,310 (21.1%)14.2% 2. USA578,983 (18.7%) 2.0% 3. Japan395,012 (12.8%) 6.4% 4. China157,601 ( 5.1%)18.0% 5.Australia112,466 ( 3.6%)11.0%

9. 9 Annual increase of the Korean arrivals to the Philippines: Annual increase of the Korean arrivals to the Philippines: - 2001:207,957- - 2002:288,46838.7% - 2003:303,867 1.1% - 2004:378,60224.6% - 2005:489,46529.3% - 2006: 572,13316.9% - 2007:653,31014.2% (cf) Filipino arrivals in Korea: 67,941 (2006)

10. 10 The Philippines is the 5th destination country for the outbound Korean tourists in general. share share 1. China 3,506,23727.8% 2. Japan 2,322,460 18.4% 3. Thailand 943,272 7.5% 4. USA 803,229 6.4% 5. Philippines 609,256 4.9%

11. 11 Flight Connection (weekly) Flight Connection (weekly) Incheon - Manila:49Incheon - Manila:49 Incheon - Cebu:23Incheon - Cebu:23 Incheon – Clark/Calibo/Laoag:12Incheon – Clark/Calibo/Laoag:12 Busan - Manila:14Busan - Manila:14 total 98 In 1993, i.e. 15 years ago, there were only 6 flights.

12. 12 I-4. Diplomatic/Consular Relations: How many people over there? How many Koreans are staying in the Philippines? - 80,000 at a given time (estimate) What about Filipinos in Korea? - 51,056 (of whom 14,530 are undocumented, as of Jan. 31) - 4 th biggest national group (China, USA, Vietnam, Philippines, Thailand, Japan, …)

13. 13 I-5. Diplomatic/Consular Relations: Naturalization Filipinos accorded the Korean nationality - 2002: 59 - 2003: 892 - 2004:1,042 - 2005: 747 - 2006: 312 Koreans accorded the Philippine nationality - None

14. 14 II-1. Economic Relations (I): Trade Korea’s Export to, and Import from, the Philippines Korea’s Export to, and Import from, the Philippines exportimport total 2005 3.2 2.3 5.5 2006 3.9 2.2 6.1 2007 4.4 2.4 6.8 (US$ bil.) * The trade imbalance (US$ 2.0 bil.) is partially compensated by the remission by 50,000 OFWs in Korea. * The trade imbalance (US$ 2.0 bil.) is partially compensated by the remission by 50,000 OFWs in Korea.

15. 15 For Korea (2007), the Philippines is For Korea (2007), the Philippines is - 18 th export destination; and - 27 th source of import (Share of trade with the Philippines: 0.94 %) For the Philippines (2006), Korea is For the Philippines (2006), Korea is - 9 th export destination; and - 6 th source of import

16. 16 Export to the Philippines (US$ mil.): 1. electronics* 1,10127.2% 2. petro-chemical61915.3% 3. mobile phone208 5.1% 4. copper 160 4.0% 5. automobile 153 3.8% Import from the Philippines (US$ mil.): 1. electronics*84837.6% 2. copper29913.3% 3. food216 9.6% 4. computer134 6.0% * Electronic goods constitute over 30%.

17. 17 II-2. Economic (II): Investment (2004)(2005)(2006) USA27.114.938.2 Japan26.627.520.1 Korea 3.310.854.3** China 0.1 0.217.9 Total 173.995.8 165.9 (billion pesos) (billion pesos) ** By Korean statistics, however, only US$ 190 mil. (i.e. less than 1/5 of 54.3 billion Peso). (i.e. less than 1/5 of 54.3 billion Peso).

18. 18 Three big Korean Investors: Three big Korean Investors: investment employment investment employment - Korea ElectricPower1.9 bil. 300 (1995) - Samsung Electronics 0.2 bil. 3,400 (1997) - Hanjin Shipbuilding 1.0 bil.15,000 (2006)

19. 19 III-1. Development Cooperation (I): Grant Aid (implemented by KOICA) Grant aid to the Philippines amounted to Grant aid to the Philippines amounted to 1991-1999: annually under US$ 1 million1991-1999: annually under US$ 1 million 2000-2002: US$ 2-3 mil.2000-2002: US$ 2-3 mil. 2003-2007:US$ 5-7 mil.2003-2007:US$ 5-7 mil. 2008: US$ 10 mil.2008: US$ 10 mil.

20. 20 With the grand aid budget, Korea does, among others, A. Construction of Facilities B. Feasibility Studies C. Technical Cooperation Korean Overseas Volunteer project Invitation of Trainees to Korea

21. 21 A.Construction of Facilities: Friendship Hospital (Cavite; US$ 4.8 mil; 2002 and 2008 in two phases) Friendship Hospital (Cavite; US$ 4.8 mil; 2002 and 2008 in two phases)

22. 22 National Lung Center Expansion National Lung Center Expansion (US$ 2.9 mil.; 2008) (US$ 2.9 mil.; 2008)

23. 23 Vocational Training Center (Davao City; US$ 5.0 mil.; 2004) Vocational Training Center (Davao City; US$ 5.0 mil.; 2004)

24. 24 Two IT Training Centers (Quezon City Two IT Training Centers (Quezon City & Bulacan; US$ 5.0 mil.; 2005) & Bulacan; US$ 5.0 mil.; 2005)

25. 25 Busuanga Airport Expansion Busuanga Airport Expansion (US$ 3.0 mil.; 2006) (US$ 3.0 mil.; 2006)

26. 26 Rice Processing Complex Rice Processing Complex (Aurora; US$ 2.3 mil.; 2007) (Aurora; US$ 2.3 mil.; 2007)

27. 27 Seafood Processing Facility (Dagupan; US$ 2.2 mil.; 2008)Seafood Processing Facility (Dagupan; US$ 2.2 mil.; 2008)

28. 28 B.Feasibility Studies: FS for constructing/improving 7 National Roads (Luzon/Visayas; 763 km; US$ 1.0 mil.)FS for constructing/improving 7 National Roads (Luzon/Visayas; 763 km; US$ 1.0 mil.)

29. 29 FS for Terminal II of the Macapagal Int’l Airport (former Clark Air Base; US$ 2.0 mil.)

30. 30 FS and Detailed Design for improving Malinao Dam (Bohol; US$ 1.0 mil.)FS and Detailed Design for improving Malinao Dam (Bohol; US$ 1.0 mil.)

31. 31 C. Technical Cooperation 1. Korean Overseas Volunteer Program - 85 volunteers active in the Philippines - finance the projects devised by volunteers within US$ 50,000 for each 2. Invitation of trainees to Korea - invite annually about 100 trainees (3 weeks – 1.5 years) (3 weeks – 1.5 years) - invited 1,284 trainees since 1991

32. 32 III-2. Development Cooperation (II): Soft Loans (by Korea Exim Bank) Soft loans to the Philippines Soft loans to the Philippines (Repayment in 20 years with a 10-year grace period and an annual interest rate of 1.5 %) (Repayment in 20 years with a 10-year grace period and an annual interest rate of 1.5 %) - 1990-2000 (11 years):US$ 40 mil. - 2001-2006 (6 years):US$ 90 mil. - 2007-2009 (3 years): US$ 300 mil.

33. 33 Major Loan Projects under way: Major Loan Projects under way: Laguindingan International Airport Laguindingan International Airport (Cagayan de Oro; US$ 32.7 mil.) (Cagayan de Oro; US$ 32.7 mil.)

34. 34 Major Loan Projects under way: Gapan-San Fernando-Olongapo RoadGapan-San Fernando-Olongapo Road (North Manila Expressway-Subic Bay, phase I; US$ 22.3 mil.) (North Manila Expressway-Subic Bay, phase I; US$ 22.3 mil.)

35. 35 Major Loan Projects under way: Manila Railroad (phase I, Caloocan-Alabang; 32km; US$ 50.4 mil.)Manila Railroad (phase I, Caloocan-Alabang; 32km; US$ 50.4 mil.)

36. 3636

37. 37 Major Loan Projects in the pipeline: Manila Railroad, phase II (Alabang-Calamba; 26km; US$ 85.0 mil.)Manila Railroad, phase II (Alabang-Calamba; 26km; US$ 85.0 mil.) GSO Road, phase II (US$ 29.0 mil.)GSO Road, phase II (US$ 29.0 mil.) Subic Bay Water Supply (US$ 47.0 mil.)Subic Bay Water Supply (US$ 47.0 mil.)

38. 38 IV. A Prognosis Tourism: arrivals are expected to increase to about a million and then level off Tourism: arrivals are expected to increase to about a million and then level off Trade: expected to be stagnant Trade: expected to be stagnant New Investment: ‘unlikely’ (small-to-medium sized businesses) and ‘maybe’ (big businesses) New Investment: ‘unlikely’ (small-to-medium sized businesses) and ‘maybe’ (big businesses) Development Cooperation: a robust increase is expected Development Cooperation: a robust increase is expected