RP still most attractive to foreign investors - FVR

Despite political and economic woes, the Philippines remains among the most attractive destinations for foreign investors, former president Fidel Ramos told American businessmen yesterday.

Speaking at the breakfast meeting of the American Chamber of Commerce in the Philippines, Ramos said the Philippines would make a superior industrial base for a fast expanding and increasingly middle class ASEAN market.

He invited investors to take advantage of the country's prime position in information technology, citing economic reforms and a workforce that ranks with India as the highest quality in Asia.

Ramos said reforms have opened up the financial system, allowing foreign equity in banks and more flexible operations of transnational investment houses and financing firms with free conversion of foreign exchange and the lifting of restrictions on remittances of profits or capital.

"Government has also taken up --with a will --the task of getting itself out of business," he said.

He gave as examples the privatization of Philippine Airlines, state petroleum company Petron, the Philippine National Bank, and even the waterworks and sewerage system of Metro Manila.

Ramos cited the advantages offered by the country's economic zones, which boast of superior power, telecommunications and transportation systems.

The Philippines has 108 of these special zones, including the sprawling former US military bases in Clark and Subic, he added.

Structural reforms have also brought down tariff walls, broken up cartels and monopolies and deregulated key industries, he added.

He said these reforms stimulated investments in the service sector, which now has the largest share, at 45 percent, of the gross domestic product.

Financial services alone have expanded by an average 8.8 yearly, he added.

Ramos said recent laws grant generous incentives to commercial producers and processors of high-value crops, livestock, fish, shrimps and crabs, and to providers of agriculture and fisheries technology.

An adaptable and talented workforce, with superior English proficiency, also make the Philippines a potential center for information technology, accountancy, engineering, construction, architectural design and entertainment, he added.

He said the Philippines now hosts 50 chip assemblers and makers of computer components, with some $6.6 billion in total investment.

"More significantly, the industry in the Philippines is already shifting toward more sophisticated and more complex products--Pentium chips, laptop computers, and digital-signal processors used in cellular telephones," he said.

"And it's riding a boom that has yet to peak as the world's chip market is expected to grow at between 12 percent to 15 percent yearly."

Ramos said information technology was a natural fit for the skill-level, availability and comparative cost of Filipino workers.