Finland group to build $200-M 'Pilipinas Tires' factory in Philippines


Agriculture Secretary Emmanuel "Manny" 
Piñol said that the Finland group of Black Donuts Engineering (BDE) are planning to invest $200 million in the country.

Piñol said the foreign group will building a tire factory wherein the materials using are coming from our locals. 

The Philippines is abundant in rubbers, especially in Mindanao. That's why the agriculture introduced it to the foreign investors and also it could help to produce jobs for the Filipinos.

Piñol called this project as "Pilipinas Tires." He said it the partnership will be successful, it can have an establishment of a $200-M manufacturing facility which is expected to produce at least 4 million "Pilipinas Tires" every year starting 2020.

Read the full statement of Sec. Piñol:

'Pilipinas Tires'

FINLAND GROUP EYES $200-MTIRE FACTORY IN PHILIPPINES

By Manny Piñol

In about three years, foreign tire brands like Yokohama of Japan, MRF of India, Gajah Tunggal of Indonesia, Goodyear of the US and others may no longer dominate the streets and roads of the Philippines.

"Pilipinas Tires" which would primarily be rubber tires for cars, pick-ups, SUVs and light cargo vehicles and agricultural machineries are expected to roll in the streets and highways of the Philippines.

"Pilipinas Tires" will be mainly made out of natural rubber produced by the Philippines' rubber farmers whose farms are located mainly in Mindanao, including Basilan and Palawan and in Negros Oriental.

(A group led by Bong Tan, son of tycoon Lucio Tan, and Jerry Murao of North Cotabato, has also started developing rubber plantations up north in Cagayan Valley and Abra targeting 10,000 hectares over the next few years.)

The dream of manufacturing a truly Philippine-made tire by a Filipino company owned by the rubber farmers themselves started undergoing a reality check yesterday with the arrival in the country of two top executives of Finland's Black Donuts Engineering.

Black Donuts Engineering (BDE) Chief Executive Officer Kai Hauvala and Director Tomi Pekkola are in the Philippines for an initial meeting with the Secretary of Agriculture and to conduct an assessment of the country's rubber industry.

The BDE of Finland designs and constructs tire factories in almost all parts of the world, including India, Africa, China and Indonesia.

The company does this under a Build-Operate-Transfer (BOT) scheme.

After a briefing in the Agriculture Secretary's office given by Philippine Rubber Research Institute (PRRI) Director Rudy Galang yesterday, the BDE executives were accompanied by Malaysian Siew King Han to Davao City from where they will inspect plantations and rubber processing facilities.

Dept. of Agriculture (DA) Region XI officials in Davao City will guide the BDE executives to the different areas in Southern Mindanao, including the identification of a proposed factory area.

Initially, the BDE executives were informed that the Philippines has about 150,000 hectares of rubber farms owned mainly by small farmers.

Most of the cup lumps and semi-processed rubber cubes are exported and therefore dependent on international pricing which is volatile.

For example, when I was Governor of North Cotabato, farmers in the province enjoyed the best price ever of over P90 per kilo of rubber cup lumps which fell to only P16 per kilo last year.

Today, the price is up to about P35 per kilo in North Cotabato and P41 in the Zamboanga Peninsula and Basilan.

There is only one reputable tire manufacturing company in the Philippines, Yokohama of Japan, which is located in Clark, Pampanga.

A Filipino-owned tire factory near the production areas is expected to provide a ready market for the farmers' produce, provide jobs and spur the development of more rubber farms in the denuded mountains of Mindanao and other parts of the country.

On Friday, before leaving home for Finland, the BDE executives will give the Agriculture Secretary a final briefing on their assessment of the country's rubber industry.

A positive report could signal the start of the organisation of rubber farmers into a company or corporation.

BDE could then enter into a partnership with the rubber farmers' group for the start of the establishment of a $200-M manufacturing facility which is expected to produce at least 4 million "Pilipinas Tires" every year starting 2020.
That would mean an estimated revenue of P24-B every year which would mainly benefit Filipino rubber farmers and workers.

Source: Manny Piñol

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