MANILA, Philippines — Over 40 local and foreign business groups urged Congress anew to approve key economic reforms that would encourage investments and generate jobs amid the ongoing pandemic.
The groups are pressing for amendments to the Public Service Act (PSA), Retail Trade Liberalization (RTL) Act and the Foreign Investments Act (FIA).
“All three measures will relax FDI (foreign direct investment) restrictions and together could result in many billions of new investments in future years, creating more jobs, diversifying the economy, bringing new technology, and increasing competition, and providing better services to the benefit of Filipino consumers,” the groups said in a joint statement.
The three measures have advanced in the 18th Congress and were certified as urgent by President Duterte.
The proposed amendments to the PSA, in particular, seek to limit public utilities to natural monopolies such as electricity, water and sewerage, and allow greater foreign investment in the telecommunications and transportation sectors.
Under the Constitution, public utilities must be 60 percent Filipino-owned.
While the proposed amendments to the PSA have been approved at the House of Representatives, the measure is still pending approval in the Senate and some senators have proposed to retain the 40 percent limit on foreign ownership to most forms of common carriers, airports, dams, roads and railroads, seaports, and telecommunications citing national security concerns.
The business groups said the amendment to apply the 60-40 ownership rule to any public service not classified as public utility defined in the bill should be declined to avoid damage to the country’s foreign investment climate.
“They would deprive Filipinos of the better public services that other countries in our region enjoy. Currently, the Philippines ranks low in ASEAN (Association of Southeast Asian Nations) infrastructure rankings, in part because foreign capital is prevented rather than welcomed to invest fully in public services,” the groups said.
The groups also said the bill before the Senate contains provisions to protect national security concerns, similar to those implemented in Australia, Japan and the US.
Other bills being pushed by the groups are the proposed amendments to the RTL which would reduce the minimum required paid-up capital for foreign retailers, and amendments to the FIA which would ease restrictions on foreign investments.
“The higher unemployment and poverty caused by the pandemic cannot be remedied by indefinite government borrowing alone. Domestic investment will remain weak for at least two years.Thus, we need to attract much more foreign capital,” the groups said.
The business groups are led by ACI Philippines, American Chamber of Commerce of the Philippines, AmCham North Luzon Chapter, AmCham Visayas Chapter, Association of Certified Public Accountants in Public Practice, Australian-New Zealand Commerce of the Philippines, Bankers Association of the Philippines, British Chamber of Commerce of the Philippines, Canadian Chamber of Commerce of the Philippines, Cebu Business Club, Cebu Leads Foundation Inc., Dutch Chamber of Commerce in the Philippines, EU-ASEAN Business Council, European Chamber of Commerce of the Philippines (ECCP), ECCP Northern Luzon Business Council, ECCP Cebu Business Council, ECCP Northern Mindanao Business Council, ECCP Southern Mindanao Business Council, Financial Executives Institute of the Philippines, FinTech Alliance Philippines, Foundation for Economic Freedom, French Chamber of Commerce and Industry in the Philippines, German-Philippine Chamber of Commerce and Industry, Institute of Corporate Directors, Investment House Association of the Philippines, Institute for Solidarity in Asia, Japanese Chamber of Commerce & Industry of the Philippines, Korean Chamber of Commerce of the Philippines, Management Association of the Philippines and the Makati Business Club.
Money Market Association of the Philippines, Nordic Chamber of Commerce of the Philippines, Organization of Socialized and Economic Housing Developers of the Philippines Inc., Philippine Association of Multinational Companies Regional Headquarters Inc., Philippine Life Insurance Association Inc., Philippines-Swiss Business Council, Philippine Business Coalition for Women Empowerment, Semiconductor and Electronics Industries in the Philippines Foundation Inc., Shareholders’ Association of the Philippines, Spanish Chamber of Commerce in the Philippines, Tax Management Association of the Philippines, US-ASEAN Business Council and Women’s Business Council Philippines.