Palace willing to consider AmCham plan
April 14, 2013 at 14:26
Malacañang on Thursday indicated willingness to consider the proposal of the American Chamber of Commerce (AmCham) to lift, without amending the Constitution, existing restrictions to full foreign ownership of public utilities.
“We can study this,” Secretary Ricky Carandang of the Presidential Communications Development and Strategic Planning Office told the BusinessMirror when sought for a reaction to the proposal aired the other day by John Forbes, AmCham senior adviser, for the government to look into this possibility.
But Carandang did not readily buy the AmCham adviser’s rosy projections that scrapping the 40-percent cap on foreign equity in public utilities would open the doors to foreign direct investments and spur competition that would benefit consumers. “I cannot offer a categorical answer [on that] right now,” he said.
The AmCham’s no-need-for-Charter-change proposal came barely weeks after Malacañang thumbed down renewed initiatives by the influential Makati Business Club to amend the 1987 Constitution and remove existing limits to full ownership by foreigners of certain industries.
Forbes suggested that the restrictions to entry of foreign investors could be remedied without having to go through a contentious Charter-change process that the Aquino administration seemed unwilling to go through.
He cited, for instance, the Foreign Investment Negative List (FINL) that only allows up to 40-percent foreign equity in public utilities. This list, he noted, is being revised every two years as mandated by the Foreign Investments Act of 1991. In the ongoing review of the FINL, he suggested that the government could consider public utilities as one of the investment areas where 100-percent foreign equity should be allowed.
Forbes explained that if the government aims to “improve competition and increase investments in public utilities without changing the Constitution, this is one way to do it.”
