The Department of the Interior and Local Government (DILG) called on Congress to heed the calls of business groups to expedite the passage of pending economic bills including the “economic constitutional reforms (Economic CORE).
DILG Undersecretary and spokesperson Jonathan E. Malaya noted that the DILG joined the call to the Senate and the House of Representatives of five respected business groups that collectively expressed their strong support for the initiatives of the Duterte administration to open the Philippine economy as a means for economic recovery and sustainability.
“The affirmation given by these business groups shows that government policies are on the right track and those business leaders are willing to work hand in hand with the administration for economic recovery and sustainability,” Malaya said.
The business groups include the Federation of Filipino Chinese Chambers of Commerce and Industry, Inc., the Foundation for Economic Freedom, Inc., the Management Association of the Philippines, the Subdivision and Housing Developers Association, Inc., and the UP School of Economics Alumni Association.
In a joint statement, the business groups called for the government to act with urgency in balancing public health with the deleterious effects of poverty and hunger on our countrymen and to maximize opportunities to attract foreign investments, create jobs, and build infrastructure for a strong digital economy.
“While we support the initiatives to liberalize the economy by amending the restrictive economic provisions of the 1987 Constitution, we are one with the position of the Department of Finance that our legislature act on something doable and immediately achievable,” the joint statement noted.
For the sake of our economy and the well-being of our people, the said business groups urged “our government officials to act with the urgency that our situation demands, implement localized containment instead of community quarantines, and enact these crucial investment reforms.’’
Foreign investments needed
Malaya insisted that the further delay in economic reform will result in lost opportunities and hinder the country’s recovery from the pandemic and more hardships for our people.
Aside from amending the Constitution, Malaya said the economic bills sought to be passed are the amendments to the Public Service Act, Retail Trade Liberalization Act, and the Foreign Investments Act.
“We have thousands of returning OFWs (Overseas Foreign Workers) and LSIs (locally stranded individuals) who have decided and who are still contemplating to go back to their home provinces for good. Pushing for economic reforms will open up investments in the countryside and will provide them with employment opportunities including long-term economic growth in the regions,” Malaya said.
Citing a World Bank study, Malaya said the 1987 Constitution obstruct foreign direct investments resulting in the Philippines having the lowest Foreign Direct Investments (FDI) in the 10-member Association of Southeast Asian Nations (ASEAN).
“Our ending FDI (Foreign Direct investment) as of 2018 is only 0.42, a figure which constitutes only 1.6 percent of our Gross Domestic Product (GDP). This is way too low compared with the average 5.89 percent GDP in our neighboring countries,” Malaya cited.
The DILG official said that by pushing for economic reforms, “we will be able to open up more than 30 economic sectors which have been covered by the 60-40 FDI restrictions favoring Filipinos since the 1935 Constitution took effect.’’
He added that this will even open up 11 sectors that have been closed to foreign investors.
Malaya stressed that a speedy passage of the economic provisions in Congress would send a signal to the international business community that the Philippines is now open for a globally competitive post-COVID economy.
The DILG, as chair of the Inter-Agency Task Force for Constitutional Reform and as the home of the Center for Local and Constitutional Reform, is a vocal and steadfast advocate of economic constitutional reform.