Officials of Japan External Trade Organization (Jetro) in Manila said that Japanese companies expressed concern on the high corporate income tax, power, minimum wage and high telecom charges compared to other Asian countries.

"The Philippines is still competitive in attracting investments because of its strategic location but it should do more to attract more Japanese investors," said Jetro director Hiroshi Yoneyama.

The Japanese Chamber of Commerce & Industry (JCCI) has also expressed concern on the current political instability and the peace and order condition in the country.

A survey conducted by Jetro on the investment-related cost in major Asian cities showed a likely shortage of electricity in India and the Philippines.

The survey noted a high price of fuel in most Asian cities due to the global increase of crude oil.

Comparing wages for workers in major cities, Japanese companies are looking for cheaper labor cost in major Chinese cities, Bangkok, Kuala Lumpur, Jakarta, Manila, Cebu, Hanoi, Ho Chi Minh city, New Delhi, Bangalore and Karachi.

There has been no substantial change in land prices and office rent in all major cities but an upward trend was observed in New Delhi.

The survey showed a declining trend of telecom expenses such as charges for fixed telephones, mobile phones and international calls due to the popularity of mobile phones.

However, telecom rates were higher in Yangon, Myanmar among the Asean countries.

There were no increases in container transportation fees, compared to the previous survey. In China, each city showed significant differences in prices, depending on the volume of container transactions and accessibility of ports.

In taxation, corporate income tax was reduced from 36 to 33 percent in India.

Singapore also cut is corporate income tax in 2005. Among the Asian countries, corporate income tax was the lowest in Hong Kong at 17.5 percent followed by Singapore at 20 percent and Taipei at 25 percent.

Vietnam has been attracting attention and many Japanese companies are taking a look for investment opportunities in that country because of lower wages compared to China.