MANILA – Nestle said Friday it was "here to stay" in the Philippines after one of its officials said moving its coffee processing plant to other Southeast Asian countries due to taxes was an "option."
Nestle has been in the Philippines for 107 years and the food and beverage giant is looking forward to "doing business here in the next 100 years," the company said in a statement.
Japanese news agency Nikkei on Sept. 5 quoted Nestle senior vice president and head of corporate of affairs for the Philippines, Ernesto Mascenon, as saying that current debates on corporate taxes should consider the "disadvantage of local manufacturers, which use local agriculture products, against those importing finished goods."
Mascenon added in the Nikkei report: "Otherwise the option for us is we will close down our manufacturing here and just move to Indonesia, or Vietnam, Malaysia, [and] import."
On Friday, Nestle said it was "not planning to close any of its manufacturing facilities in the Philippines."
"Coffee under our Nescafe brand remains to be a core pillar for us, and we are committed to support the local coffee industry and our coffee farmers to growth," it said.
According to the Nikkei report, Nestle is grappling with high sugar costs as the government prohibits beverage makers from using imported sugar.
Congress is debating the second tranche of tax reforms, which seeks to update incentives for companies and reduce to corporate income tax rate to 20 percent from 30 percent.
The first package, which took effect on Jan. 1, raised duties on fuel, cars and sugar-sweetened drinks.