An estimated 1.6 million job opportunities will be created with household income substantially increased if the economic restrictions in the 1987 Constitution are relaxed, a University of the Philippines (UP) researcher said Sunday, May 30.

Leandro Tan, of the University of the Philippines Public Administration Research and Extension Services Foundation-Regulatory Reform Support Program for National Development (UPPAF-RESPOND), explained that economic reforms in the Constitution could reduce the 7.1 percent unemployment rate reported in March 2021 to only 3.8 percent.

“The unemployment situation in the country has escalated since April 2020 while a negative net of -1.3 million remains,” Tan said during the second session of the webinar series on the impact of opening the economy on jobs and labor. The webinar was sponsored by the Department of the Interior and Local Government (DILG).

Last week, the House of Representatives approved on second reading Resolution of Both Houses (RBH) No. 2 which seeks to amend the 1987 Constitution and empower the Congress to lift constitutional limits on foreign investments embodied in the Charter.

Tan said that removing foreign equity restrictions would also yield a potential foreign direct investment (FDI) of $16.2 billion.

He added that infusing more FDIs into the economy would remove job deficits in the manufacturing, electricity, gas, water, real estate, and business services.

“Other sectors such as transportation, public administration and defense, education, and other services will be reduced by 390,000 or 33 percent. Even family or household incomes would rise by P197 billion or P 8,000 per family with relaxed FDI,” he said.

According to Tan, the Gross Domestic Product (GDP) growth rates showed that the Philippines was lagging behind other neighboring countries like Thailand, Singapore, Malaysia, Indonesia, and Vietnam due to the impact of COVID-19 pandemic.

“The imposed economic lockdown brought by COVID-19 has derailed the country from the sustained GDP growth path, from 6.1 in 2019, -9.6 in 2020 down to -4.2 in the first quarter of 2021,” he stressed.

Meanwhile, DILG Undersecretary and spokesman Jonathan Malaya emphasized that the potential investment and labor impacts of economic reforms would speed up economic recovery.

“This will have a significant impact on the long-term phase of our recovery solutions to beef up investments, employment, incomes, labor workforce, and other sectors greatly affected by this health crisis,” Malaya said.

The DILG official said that explaining to the people the benefits to be derived from lifting the economic restrictions would be much easier now as the proponents have stipulated in their studies and simulations on the said reforms.

“Most of our lawmakers in Congress, business groups, economists, and experts send an overwhelming support to the proposal because they know that this would send a strong signal to the world that we are ready to an attractive investment climate, create more jobs and livelihood, and make the necessary adjustments in the economy for progress,” Malaya said.