By Chino Leyco
The Duterte administration will again push for the passage of its trade and investment measures in the 18th Congress and attempt to lift the foreign ownership limits in certain sectors, the Department of Finance (DOF) said.
Finance Secretary Carlos Dominguez (REUTERS/Kim Kyung-Hoon / MANILA BULLETIN)
In a recent dialogue with the incoming members of the House of Representatives, Finance Secretary Carlos G. Dominguez told the new lawmakers that they will include Foreign Investments Act (FIA), the Retail Trade Act, and the amendments to the Public Service Act in President Duterte’s legislative agenda for the next Congress.
With one month before the opening of the 18th Congress, Dominguez appealed to the lawmakers to seriously consider the proposals coming from the executive that would make the Philippines’ economic foundations sustainable or even boosting the country’s high and inclusive growth.
“Together, we can ensure the sustainability of the high and inclusive economic growth rate we enjoy today,” Dominguez said. “The matter is in your hands. All you have to do is ask us how we can help you, and together we can make a better life for the Filipinos.”
The business community, along with the DOF, has been pushing for revision of the 28-year-old FIA to further entice foreign investors to set up shops in the Philippines.
While foreign investments in the country have continued to increase, the Philippines still trails its neighbors when it comes to foreign direct investments (FDIs).
Based on the World Bank data, Philippines’ FDI accumulation for the 2015 to 2017 period stood at $23.98 billion, way below Singapore’s $208.48 billion. Indonesia ranked second in the region with $45.79 billion, followed by Vietnam with $35.5 billion, and Malaysia with $32.84 billion.
Only Thailand, which brought up the rear at $19.78 billion, recorded a lower FDI accumulation than the Philippines.
The DOF, along with the National Economic and Development Authority (NEDA), is also proposing to pass the Retail Trade Liberalization Act, which is meant to encourage investments in industry and services sector while boosting private construction.
Under the proposal is the lowering of the required minimum paid-up capital for foreign entrants to the country’s retail sector to $200,000 from the current $2.5 million and scrap the minimum investment requirement of $830,000 per store.
The third proposal unveiled by Dominguez is a bill aiming to amend the 82-year-old Public Service Act, which once passed into law, will lift foreign ownership limits in certain sectors, particularly in public utility.
If enacted, the proposal will remove the foreign ownership restrictions on telecommunication and transportation service providers. Under the Philippine 1987 Constitution, operators of public utilities should be at least 60 percent Filipino-owned.
“We can mutually move forward with legislation that really contributes to the common good,” Dominguez told the new House members.
He also said that the DOF is currently reorganizing its personnel so it could assign more full-time directors and staff to engage with lawmakers on a weekly basis, with the goal of ensuring that the Legislative and Executive departments could mutually move ahead in passing laws.