THE Philippines has the lowest Foreign Direct Investments (FDI) in the 10-member Association of Southeast Asian Nations (ASEAN) because of restrictions in the 1987 Constitution, according to a staunch advocate of constitutional reform (CORE).”
Gary Olivar, a former presidential economic spokesperson and a professor of finance, said a World Bank study showed the country’s FDI Regulatory Restrictive index of 0.42, the smallest in ASEAN.
“Over the 10 years ending 2018, FDI in the Philippines averaged only 1.6 percent of Gross Domestic Product (GDP) every year,” Olivar said. “This is the lowest among the ASEAN countries, where average FDI over the same period was nearly four times higher at 5.89 percent of GDP.”
Because of these restrictions, Olivar says, none of Western companies that have left China over the past few years due to trade war issues has relocated to the Philippines.
“This is nothing short of a national tragedy,” Olivar said. In the middle of the pandemic, now is when we sorely need foreign investment to encourage provincial relocation under the President’s Balik Probinsiya Program to employ hundreds of thousands of Overseas Filipino Workers who are coming back home to return our economy to long term growth.”
Olivar also cited a Department of Finance study which counted more than 30 economic sectors covered by FDI restrictions, typically 60-40 in favor of Filipinos. Of this number, 11 are closed to foreign investors.
“Now is when we sorely need foreign investment to return our economy to long-term growth,” he said.
Earlier, the Foundation for Economic Freedom (FEF), a public advocacy organization dedicated to advancing the cause of economic and political liberty, good governance, secure and well-defined property rights, market-oriented reforms, and consumer protection, stated support for reforms in the 1987 Constitution, particularly on lifting FDI restrictions.
In its statement, the FEF said that inserting the phrase “unless otherwise provided by law” into the restrictive language gives Congress the authority to reduce or eliminate those restrictions as part of a more flexible and pragmatic policy framework.
The League of Municipalities (LMP) led by Narvacan, Ilocos Sur Mayor Luis “Chavit” Singson also joined the call for the lifting of restrictions on foreign investments.
The LMP is also pushing to institutionalize the Supreme Court’s Mandanas ruling which transfers significantly more financial resources to local governments.
Olivar praised Senators Francis Tolentino and Ronald “Bato” Dela Rosa and House Representative Cong. Alfred Garbin for agreeing to hold new talks on constitutional amendments, particularly on the easing of restrictions on FDIs, starting next week.
“It is high time for our country to climb out of the cellar of foreign investment, especially now that our economy urgently needs to recover after enduring the world’s longest lockdown against the coronavirus,” Olivar stressed.
“Together with my fellow reformers and advocates in CORE, I am ready and willing to debate with anyone, anywhere, on the wisdom of the Constitutional reforms that we are proposing,” he added.Publication Source : People's Tonight