Foreign businessmen to PNoy: Let reform take root fast to sustain economic momentum
March 5, 2013 at 18:58
MANILA – The government has made inroads at improving the business environment and growing the economy, but further reforms have to be done faster to ensure that these positive changes would benefit the country in the long run, the Joint Foreign Chambers of the Philippines said on Tuesday.
During the Arangkada Philippines Second Anniversary Forum, American Chamber of Commerce of the Philippines Inc (AmCham) president Rhicke Jennings said 64 percent of the recommendations made by the Joint Foreign Chambers in 2010 have been “started,” have undergone “substantial progress” or were “completed” in 2012, a 9-percent jump from 55 percent in 2011.
The Arangkada Philippines initiative outlines 471 recommendations, which the Joint Foreign Chambers claims if put in place would generate $75 billion in foreign direct investments (FDIs), 10 million jobs and more than a trillion pesos in revenues for the government in 10 years.
The recommendations encompass the agribusiness, business process outsourcing (BPO), creative industries, infrastructure, manufacturing, logistics, mining and tourism, medical travel and retirement — sectors that the group said would lead growth.
Recommendations have also been made to improve the general business environment on concerns about business costs, the environment and natural disasters, foreign equity and professions, governance, the judicial and legislative branches of government, labor, local governance, macroeconomic policy, security and social services.
“Last year, we told President Aquino to increase the 55 percent… That is precisely what happened,” Jennings said, referring to Arangkada Philippines’ first anniversary assessment made in 2012.
However, the improvements made so far are “not yet enough,” Jennings said.
“The pace of reforms should not continue; it must be faster so growth is higher, inclusive and sustainable,” he said.
He said the moves toward good governance made by the Aquino administration may not be sustained by future leaders, noting that “the Philippines has experienced backsliding in governance before.”
The present administration should therefore put in place more reforms and make sure there is a better implementation of these reforms, Jennings said.
Despite economic expansion, “poverty is still stubbornly high” in the country and has not declined, unlike in most neighboring countries, said Ian Porter, Australian-New Zealand Chamber of Commerce (Philippines) Inc president.
Porter said only when there are sound economic policies and a corrupt-free government can the country move twice as fast and realize its potential.
“The Philippines has extraordinary opportunities,” he said, citing for instance the gains to be made once the Tampakan mine project in Mindanao is cleared to operate.
“Last year’s 6.6-percent GDP [gross domestic product] growth is good, the best in Southeast Asia. But if Tampakan is opened, 8-percent [growth] can be achieved,” Porter said.
Also, same old concerns, such as foreign ownership restrictions, corruption and red tape, the mismatch between national and local government laws, as well as the slow rollout of public-private partnership (PPP) infrastructure projects remain deterrents to more FDI inflows.
Any move to open up the Philippine economy will be welcomed by foreign investors, but in the end it is up to Filipinos to decide if they want greater economic liberalization either by amending the Constitution or approving legislation that would tweak specific restrictions, said John D. Forbes, AmCham senior advisor and principal author of Arangkada Philippines.
If the country removes foreign ownership barriers, “there will be more foreign investments in the sectors that will be liberalized,” Forbes said.
He said wider participation of foreign businessmen will result in more competition, which could bring down prices of goods.
Only when pending concerns are addressed and faster reforms are made could more investments be generated and more jobs created, Jennings said.
“We hope 2013 will result in further progress,” he said.
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Source: Ben Arnold O. De Vera, InterAksyon, 26 February 2013
