The Aquino administration shall push for laws that will lift restrictions on foreign investments in various domestic industries, with its economic team and allies in Congress agreeing that opening the economy up further to investors is long overdue.
“President Aquino and some members of Congress understand that it makes sense to now change the rules of the game,” said Arsenio Balisacan, director general of the National Economic and Development Authority.
Balisacan, who also serves as the country’s socioeconomic planning secretary, said the President is keen on opening up domestic industries to foreigners, but without having to amend the Constitution.
He said this is possible, noting that a review of existing laws covering several industries has begun to determine which ones can be replaced without having to touch the country’s charter.
“We [economic team] believe a big part of current restrictions can be amended only by issuance of laws and without amending the Constitution. We want to make a strong case in Congress for changing some laws,” Balisacan said Friday in a forum organized by the Foreign Correspondents Association of the Philippines.
The country’s chief economist said lifting restrictions to foreign ownership and investments is vital to preparing the Philippines for the economic integration of the Association of Southeast Asian Nations, which is scheduled to take place in 2015. Under the plan, Asean members shall become one economic bloc where cross-border investments are can be made with ease.
Although some economists believe actual implementation of the Asean economic integration may extend beyond 2015, Balisacan said it would pay to be prepared. He said that if the Philippines retains existing restrictions to foreign ownership and investments, the country would be left out of reaping the economic benefits of easier investment flows.
Balisacan said restrictions contribute to the low levels of foreign direct investments (FDIs) being cornered by the Philippines compared with its neighbors. The primary reasons include questions about the sustainability of economic growth and inadequate infrastructure.
He said the Philippines, which grew year on year by 6.8 percent in 2012 and 7.8 percent in the first quarter of this year, should be able to keep registering rapid growth rates, invest more in infrastructure, and lift restrictions to foreign ownership and investments in order to catch up with its neighbors in terms of FDIs.
Balisacan said attracting FDIs is crucial in helping trim the relatively high underemployment rate and poverty incidence in the Philippines. Underemployment stood at 19.2 percent in April this year and 27.9 percent in June 2012.
He added that FDIs are needed to generate high-quality jobs for Filipinos.