Latest Stories

Gov’t urged to amend retail trade law

High equity limit deters flow of new investments


The government should amend the retail trade law as it imposes various restrictions to foreign retail investors wanting to do business in the country.

Aside from deterring investment inflow, these restrictions also put the country at a serious competitive disadvantage compared to its neighbors in the region.

John Forbes, senior adviser of the American Chamber of Commerce and Industry (AmCham), Wednesday said that it was time to review the law because the country has failed to attract many players in the retail market.

One of the provisions deemed “restrictive” by foreign investors under Republic Act No. 8762 or the Retail Trade Liberalization Act of 2000 stated that enterprises with paid-up capital of less than $2.5 million “shall be reserved exclusively for Filipino citizens and corporations wholly owned by Filipino citizens.” Only enterprises with a minimum paid-up capital of $2.5 million or more may be wholly-owned by foreigners.

“I don’t think there’s reason to protect the retail trade sector. If you look throughout Asia, you’ll find that the Philippines has one of the most protectionist regimes on retail trade, while others are much open,” Forbes explained.

“And keep in mind that if the goal of the government is to have 10 million tourists by 2016, it would be good to have in retail trade as many restaurants as possible, serving different kinds of food, and as many bars as possible,” he said in a briefing Wednesday.

To make the Retail Trade Act more liberal, Forbes said that their best proposal was to reduce the equity limit and make it more consistent with the minimum provisions set in other existing laws such as the Foreign Investment Act.

In a letter sent to the Senate in October 2011, the Joint Foreign Chambers of Commerce reiterated that the Retail Trade Act has not achieved its objective of liberalizing foreign ownership in the retail trade sector due to various restrictions.

It pointed out that the capital requirement of $2.5 million was “not only the highest in Asia after Malaysia, but is also uncommon among the economies examined.”

Follow Us

Follow us on Facebook Follow on Twitter Follow on Twitter

Recent Stories:

Complete stories on our Digital Edition newsstand for tablets, netbooks and mobile phones; 14-issue free trial. About to step out? Get breaking alerts on your mobile.phone. Text ON INQ BREAKING to 4467, for Globe, Smart and Sun subscribers in the Philippines.

Tags: American Chamber of Commerce and Industry , Business , economy , News , retail law

  • TruthHurts

    “THE Philippines, which claims to be the first democratic government in Asia, is actually ruled by oligarchs.

    ‘The oligarchs still rule the country, and Filipinos will forever be the victims of their profiteering,’ says political science professor Benito Lim of the Ateneo de Manila University.”

    I will agree. But foreign capitalists are another form of oligarchy on a global level. Not much difference.

    The only way to break free from all these is to allow all citizens to create productions and livelihood programs, and instead of competing, they ought to patronize each other now so they become strong. Only top-down policies could bring that, because only a government could effect changes that create immediate ripples across any system.

    Boycott oligarchic businesses and influence. It must now be held in the highest contempt so people build a strong aversion for anything related to oligarchic families and interests. That should cripple them for awhile…and allow alternatives to flourish. I’m not however buying the transnational expansionist takeover. It’s a greater evil to be reckoned with.

    I’m not a xenophobe. I just happen to know things beyond the surface.

    • Trevor Llewellyn Evans

      No You Dont, you are simply a Nationalist trying to claim the Philippines can pull itself out of the rut it’s in, which it hasn’t been able to do since the US left it after WWII. It has failed miserably over the past 60 years. The truth is in the History of the Nation, for all to see. Are you some sort of Communist, like Pol Pot? Is that your real agenda here?

      • TruthHurts

        ” Are you some sort of Communist, like Pol Pot?”

        Oh please. Stop making such asinine comments. Why do capitalists always think that if your views don’t align with their exploitative agenda, you must be a communist…and not just any type, but either PolPot or Mao Zedong’s? (Not even thinking that their brand of capitalism was initially propped by communist ideals.)

        I’ve heard that several times already and I personally am very democratic.

      • Trevor Llewellyn Evans

        Ahhh….now the real agenda comes out…I’ve got you now. Good luck with your next SONA Protest.

      • TruthHurts

        I think I know who you’re thinking about…Let me guess, the Danish, or was it the Netherlander guy, I mean, the Dutch who made some policeman cry?

        Whatever gave you that idea? No, I haven’t been to that protest. I wish I were…but I was a capitalist at that time…too busy with business matters. We don’t rest even on holidays. But yes, I ought to have been patriotic and supported national protests concerning the economy.

        I’m too busy recently with mundane things to be in protests. But I guess, it’s a democratic duty I ought to pay tribute to, one of these days.

  • Trevor Llewellyn Evans

    Rizal believed that the only justification for national liberation was the restoration of the dignity of the people, saying ‘… why independence, if the slaves of today will be the tyrants of tomorrow?’ In light of this, the following analysis of the country’s economy makes uncomfortable reading.

    Nick Legaspi

    THE Philippines, which claims to be the first democratic government in Asia, is actually ruled by oligarchs.

    ‘The oligarchs still rule the country, and Filipinos will forever be the victims of their profiteering,’ says political science professor Benito Lim of the Ateneo de Manila University.

    Lim says the oligarchs can be controlled but it will require strong political will. Asked if President Benigno S Aquino III, who continues to enjoy high popularity and trust ratings, can do it, Lim responds: ‘Mukhang hindi siya pinakikinggan. Maliit ang boses. [It seems nobody listens to him. Weak.]‘

    Members of the oligarchy in the Philippines have ‘little corners’ of their own and hardly get out of their own spheres of industries, apparently realising that if they resort to competition, one of them will fall.

    ‘In general, we see no competition among the oligarchs because the role of the oligarchs is chasing after profits,’ Lim notes. ‘There is no crossing of swords resulting in big competition except for the PLDT-Globe dispute.’

    On the other hand, everybody wants to be on top. ‘Right now, Henry Sy is the richest,’ Lim relates, ‘but others continue to aspire for that position.’

    Political analyst Alex Magno says oligarchy is a term in political science which applies to a government controlled by a group. Loosely used, oligarchy can apply to the dominance of the national economy by a few individuals or a group.

    Imperfect regulatory structure

    ‘With an imperfect regulatory structure and uneven access to opportunities the tendency is for a few to control the economy,’ Magno explains.

    He says oligarchs in the Philippines are not so different from those in other countries – ‘they are protected and nourished by an imperfect regulatory structure.’

    Asiasec Equities, in a recent report, cites the situation in the domestic cement industry.

    According to the report, the cement industry has had little investment in new capacity for the past 15 years after the ‘Big Three’ foreign players consolidated domestic ownership and controlled practically 90% of industry capacity.

    ‘Instead of building, the big three cement players decommissioned several kilns and reduced domestic capacity to 14mn MT against claimed installed capacity of 22mn MT,’ Asiasec relates. ‘The current price of cement of US$110/MT is the highest among emerging markets in Asia and the average age of the Philippine cement facilities is over 40 years.’

    ‘There is an apparent “controlled supply environment”, which is conducive for pricing,’ the equities firm avers.

    The Russian example

    The Merriam-Webster online dictionary defines oligarchy as 1) ‘a government by the few’, or 2) ‘a government in which a small group exercises control especially for corrupt and selfish purposes; also: a group exercising such control’.

    Wikipedia says oligarchy is ‘a form of power structure in which power effectively rests with a small number of people. These people could be distinguished by royalty, wealth, family ties, corporate, or military control.’

    ‘Aristotle pioneered the use of the term as a synonym for rule by the rich, for which the exact term is plutocracy, but oligarchy is not always a rule by wealth, as oligarchs can simply be a privileged group, and do not have to be connected by bloodlines as in a monarchy,’ Wikipedia relates.

    As an example of a modern oligarchy, Wikipedia cites what happened after the collapse of the Soviet Union in December 1991, when privately owned Russia-based multinational corporations, including producers of petroleum, natural gas and metal, became oligarchs.

    Wikipedia’s narration is strikingly similar to what is happening in the Philippines today: ‘Privatisation allowed executives to amass phenomenal wealth and power almost overnight. In May 2004, the Russian edition of Forbes identified 36 of these oligarchs as being worth at least $1 billion.’

    In the Philippines, Forbes magazine listed 11 Filipino billionaires for 2011, up from five for 2010. The new billionaires are: San Miguel Chairman and CEO Eduardo Cojuangco Jr. ($1.4 billion), David Consunji ($1.98 billion) of DMCI Holdings Corp., Enrique Razon ($1.68 billion) of the International Container Terminal Services Inc., Metrobank’s George S.K. Ty ($1.1 billion), former Trade and Industry Minister Roberto Ongpin ($1.3 billion) and Jollibee Chairman Tony Tan Caktiong ($1 billion).

    Retailing and banking king Henry Sy remains the richest with a net worth estimated at $7.28 billion, followed by Lucio Tan ($2.88 billion), John Gokongwei Jr. ($2.48 billion), Andrew Tan ($2 billion) and Jaime Zobel de Ayala ($1.78 billion).

    Oligarchs won’t allow charter change

    Senator Manny Villar says oligarchy is the reason why attempts to amend the economic provisions of the Constitution have failed – three presidents (Fidel Ramos, Joseph Estrada and Gloria Macapagal Arroyo) tried to amend the Constitution in the past 15 years, to no avail.

    ‘We’re still an oligarchy run by a few families,’ Villar says. ‘They’re happy with the present setup now and they will not allow the Constitution to be tampered with.’

    ‘The media, from what I’ve seen, is also controlled by groups that do not want to change the Constitution,’ the former Senate president adds. ‘And that is why any proposal [to amend the Constitution] will be killed right away.’

    Villar notes the difficulties encountered by small entrepreneurs in growing their business.

    ‘We always look at foreign investments but we don’t look at the local, the small entrepreneurs, who are unable to borrow, unable to access credit because our banking system is controlled by five or six families and they are happy investing in ROPs [government debt papers] or lending to big industries,’ the senator relates. ‘Right now that is our banking system – it’s a cartel and it’s getting fewer and bigger through consolidation.’

    Villar did not identify the families that control the banking system.

    The biggest bank in terms of resources, Banco de Oro, is owned by Henry Sy, who also owns China Bank. George Ty owns the second largest bank, Metropolitan Bank & Trust Corp.

    The Ayalas own Bank of the Philippine Islands, the third largest and the most profitable, while Lucio Tan owns the Philippine National Bank and Allied Banking Corp.

    Taipan Alfonso Yuchengco owns Rizal Commercial Banking Corp. while the Cebu-based Aboitiz family owns Union Bank.

    Then Socioeconomic Secretary Romulo Neri, during a forum organised by the University of the Philippines in 2004, indicated that the oligarchs were the first and foremost to oppose tax measures being proposed by government such as those for sin products, medicine, telecommunications, and power.

    In its newsletter, the UP Third World Studies Center and Department of Political Science recalled that ‘in 1997, with the passage of the Comprehensive Tax Reform Package, the country’s tax effort declined. In one of its provisions, corporations enjoyed a cut in their tax rates along with other numerous tax incentives.’

    Oligarchy breeds political dynasties

    Philippine Star columnist Carmen N Pedrosa believes that oligarchy has become a culture in the Philippines. ‘Our culture is so deeply imbibed with the ambition for wealth and power,’ she said in her column ‘From a Distance’ published by the Philippine Star on 10 July 2010. ‘So when we blame oligarchs for the sorry state of our country, we must also look into ourselves and say yeh, but we also want to be oligarchs or be friends with an oligarch because that is the system.’

    According to Pedrosa, political dynasties are among the effects of oligarchic culture. ‘So it should not surprise anyone that in the last two governments we have had children of past presidents, one of them from a very wealthy family,’ she said.

    President Gloria Macapagal Arroyo is the daughter of President Diosdado Macapagal, while President Benigno Aquino is the son of President Cory Aquino.

    ‘The trouble is that all this is done under cover of democracy,’ Pedrosa said. ‘We delude ourselves that we are democratic and we have elections to prove that. There will be few who will accept that if we were to think it through, elections merely vote in or vote out leaders from the same small pool of oligarchs or would-be oligarchs.’

    ‘We need to break out of this vicious oligarchic circle,’ she stressed. ‘Unfortunately, we can only do that by changing our Constitution or launching a revolution, hopefully not a violent one.’

    ‘The oligarchic stranglehold on the Philippine political economy can be loosened by strengthening the bureaucracy, reforming the political party system and amending the Philippine Constitution,’ said Romulo Neri. ‘Without these reforms, the oligarchic dominance over the state will never be broken.’

    The statement of Ateneo’s Benito Lim is grim: ‘There is harmony among the oligarchs. Filipinos will continue to be at the mercy of the oligarchs.’

    7 groups dominate economy

    Asiasec’s report identifies seven conglomerates that dominate the Philippine economy, without labelling them as oligarchs. These are: San Miguel Corp. (SMC), Ayala Corp., First Pacific, SM Investments Corp., JG Summit, DM Consunji and Aboitiz.

    Asiasec says that, among the conglomerates, SMC has a very tight grip – its control and ownership remain substantial in its key business units – compared with the other groups that have neither a super majority interest nor a consolidating stake of 51% in their key businesses.

    SMC has 100% interest in its power generation business, 90% in Petron (fuel and oil), 100% in telecom, 99% in food, 78% in Ginebra, 99% in property (San Miguel Properties Inc.), 70% in Bank of Commerce, 100% in mining (coal) and 100% in airport (Caticlan).

    SMC enjoys majority interest in San Miguel Brewery (51%), Metro Rail Transit 7 (51%) and toll roads (51%).

    In addition, SMC has a significant minority in other businesses: 37% in the Manila Electric Co., 40% in Liberty Telecom and 35% in Manila North Harbor.

    Ayala Corp. has 68% interest in Integrated Micro-electronics Inc., 54% in Ayala Land Inc., 31% in Globe Telecom, 34% in Bank of the Philippine Islands and 43% in Manila Water Co.

    Asiasec notes that Ayala Corp’s ownership in key businesses it controls such as telecom and banking has not even reached a majority (51%) ownership, in contrast with SMC’s controlling and super majority position in most of its businesses.

    ‘The power generation ambition of Ayala Corp., which was welcomed by the market, is in contrast a very small wind-farm (less than 50 MW) vis-a-vis San Miguel’s diverse power portfolio (3,145 MW),’ Asiasec says.

    Hong Kong-based First Pacific, represented by PLDT Chairman Manuel V. Pangilinan, has a controlling interest (100%) in TV5, majority interest in Metro Pacific Investments Corp. (55%) and controlling but not majority interest in Philippine Long Distance Telephone Co. (27%), Philex Mining Corp. (46%) and Manila Electric Co. (41%).

    Henry Sy’s SM Investments Corp. (SMIC) has controlling interest in its department store business (90%) and supermarket (100%), majority interest in SM Prime Holdings (51%), controlling but not majority interest in Banco de Oro (41%) and SM Development Corp. (44%), and significant minority interest in China Bank (20%), Highlands Prime (31%) and Belle Corp. (35%).

    ‘For the SM group, it is worth highlighting that their retail assets (department store and supermarket) are all consolidated under SMIC and remain super majority,’ Asiasec says. ‘They have a majority controlling interest in SM Prime, albeit the ownership has been opened to the public, and controlling interest in both SMDC and BDO.’

    John Gokongwei’s JG Summit has controlling interest in petrochem (80%), majority interest in Universal Robina Corp. (60%), Robinsons Land Corp. (60%), Digital Telecoms (50%) and Cebu Air (65%), and a significant minority in UIC (32%).

    The Aboitiz group controls Pilmico (100%) and Aboitiz Power (76%) and has controlling but not majority stake in Accuria, its transportation business, at 49.5%.

    DMCI has a 100% stake in DMCI Homes, 56% in Semirara Mining Corp. and 33% in Maynilad Water Services Inc.

    Nick Legaspi is Managing Editor of the Philippine weekly business newsmagazine BizNews Asia, from which this article is reproduced (July 18-25, 2011 issue).

    • TruthHurts

      And foreign investors are not the solution!

      Just in case we forget, the colonizers/ imperialists/ foreign squatters/ expansionists/ historical political investors/ Spaniards were the murderers of Rizal, and his books were primarily targeted at them.

      • Trevor Llewellyn Evans

        NO they were not. You are WRONG, WRONG, WRONG. Your Protectionist ideology is exactly why the Philippines is lagging behind it’s ASEAN neighbors.

      • TruthHurts

        Haha…Tell that to the marines. I’ve reviewed all the articles you mentioned below. Thank you, I’ve learned a lot. And they all point to one thing…

        All countries are protectionists by heart. So let’s cut the hypocrisy, because we’re no longer kids to fall for these doublespeak.

        Be honest and true to your heart. I will respect you more as a human being.

        It’s important to know when you’ve been beaten in your own argument. Don’t insist what you have proven for yourself to be untrue…

        Because The Truth always Hurts.

      • Trevor Llewellyn Evans

        What would you know about the Marines, your just sprouting of Protectionist nonsense like some Tea Party wacko. The fact is, the Philippines is a mess, it needs lots of work, and it needs FDI. You can run around protesting the IMF/World Bank etc, but in the end, your people need jobs, and if left up to the Filipinos to create them, it will never happen, you know it and I know it. I am true to my heart, I have seen what FDI has done for many economies, and the Philippines desperately needs the capital. Its time to bring the OFWs home to opportunities here, which will never exist in the current climate of Filipino management and government. That’s a fact. And we have 60 years of failure as proof. You cant blame the Spanish, Americans or the Japanese for it, you cant blame the IMF, you can only blame yourselves.

      • TruthHurts

        “sprouting of Protectionist nonsense like some Tea Party wacko”

        The Tea Party, if you must know, is insisting the very policies you espouse: the two Bush administrations, to be specific. Oh yes, they do preach that to the world, while the republicans act differently. Then again, Obama and Clinton (who are democrats) are pretty much the same.

        What is it with these people? They say something and encourage people to follow this and that, but they adopt policies and activities that contradict their own philosophies.

        I can only assume one thing: they have a grander agenda…a subtle type of global domination.

      • TruthHurts

        ” Its time to bring the OFWs home to opportunities here, which will never exist in the current climate of Filipino management and government.
        That’s a fact.”

        Well, I’m hoping our current president would find in his heart to change the direction of the country, after all, he too will become an ordinary citizen again when his term is over.

        “And we have 60 years of failure as proof. You cant blame
        the Spanish, Americans or the Japanese for it, you cant blame the IMF, you can only blame yourselves.”

        True. I’m not arguing with that.

        “The fact is, the Philippines is a mess, it needs lots of work, and it needs FDI.”

        Partly true. It is a mess. It needs a lot of work. It needs FDI, yes. But we ought to be cautious about that because it’s never wise to make one’s country indebted externally, since local financing can always be provided by the government in ample amounts. I will also cite Japan (and even China) with that type of strategy.

        FDI is just one of the minor options. It ought not to be the centerpiece. There are BETTER strategies than that.

  • Trevor Llewellyn Evans

    Look at Japan and Germany, both rebuilt after WWII with US FDI, and look at what that did for them. Unfortunately for the Filipino, the Philippines squandered its opportunities and forced FDI and MNCs out of the Country in an effort to support the local Oligarchy. And where has that gotten you all these years? In the 1950s, the Philippines was equal with Japan economically, in the 70s it was equal with South Korea, where are those countries now, compared to the Philippines? The Philippines needs FDI, in more Industries than just retail. The Philippines needs jobs. Your OFWs already rely 100% on Foreign Investment, wouldn’t it be nice if they could come home to opportunities back home?

    • TruthHurts

      You better read:

      Protectionism in Japan
      by Marcus Noland, Institute for International Economics, Washington D.C.

      because reality is very different from what we are “allowed” to know. Appearances are always deceiving.

      • Trevor Llewellyn Evans

        Again, you can’t deny that Japan became the Power House Economy that it is because of US FDI after WWII, all you keep quoting are articles that show Japans approach to INWARD FDI, AFTER it was already a massive economy with a huge technology and Manufacturing base. How much of World FDI comes FROM Japan now?

      • TruthHurts

        Precisely. That’s what Japan intends to do.

        We are swimming in double-speak. Everywhere you look, you will see forked-tongues. Developed governments and transnational companies will preach one thing, but really adopt its opposite. It’s a political and business strategy. Control how your opponents think and teach them things that would work best to your advantage.

        As the Japanese put it, “fukoku kyohei” rich country equals strong army. Japan breaks into an industry, wipes out existing Western competitors, then successively hands the industry down to less sophisticated neighboring economies such as Korea, Taiwan, Thailand, Malaysia, and Vietnam as they mature.

      • Trevor Llewellyn Evans

        Oh please….

      • TruthHurts

        Yes, “fukoku kyohei.”

        It sounds vulgar and malicious. And it really is. That’s their philosophy. So don’t tell me they believe in all these free-market gospel. The Truth is, they Don’t. But they teach people the opposite. Same with the US, Canada, and Britain.

        So what am I supposed to do? Play along with the charade when I know where this dance would lead to?

        I will embrace the Truth, as always, even when it Hurts.

  • graftbuster


    • Grey Eminence

      If this would be dumped, there wouldn’t be so much need for anti-dummy law and all kind of related hanky-panky that only benefitst the fixers, nobody else.

  • Joseph20112012

    Promoting transparency and corruption should not be dealt within the government but also, in private business place like eliminating rent-seeking for example. To realize that:

    Abolish the 60/40 equity restrictions (Article XII, Sections 2, 10-14; Article XIV, Section 4; Article XVI, Section 11) from the 1987 constitution against foreign individuals or corporations who wishes to set-up their businesses anywhere in our country and allow them to invest 100% from their own capital and own it what they invested in order to lure more foreign investors to invest and stay in our country that will provide jobs to millions of unemployed Filipinos at home as much as possible without constitutional barriers.

    Foreign equity ownership by economic sector should be like this:

    Mining – 100%.
    Oil and gas – 100%.
    Agriculture – 100%.
    Forestry – 100%.
    Light manufacturing – 100%.
    Food products manufacturing – 100%.
    Pharmaceutical manufacturing – 100%.
    Publishing – 100%.
    Fixed-line infrastructure – 100%.
    Fixed-line telephony services – 100%.
    Wireless/mobile infrastructure – 100%.
    Wireless/mobile services – 100%.
    Power distribution – 100%.
    Power generation (biomass) – 100%.
    Power generation (coal) – 100%.
    Power generation (hydro) – 100%.
    Power generation (nuclear) – 100%.
    Power generation (solar) – 100%.
    Power generation (wind) – 100%.
    Power transmission – 100%.
    Banking – 100%.
    Insurance – 100%.
    Airport operation – 100%.
    Domestic air – 100%.
    International air – 100%.
    Domestic shipping – 100%.
    International shipping – 100%.
    Advertising – 100%.
    Magazine – 100%.
    Newspaper – 100%.
    Radio broadcasting – 100%.
    Television broadcasting – 100%.
    Construction – 100%.
    Retail distribution services – 100%.
    Tourism – 100%.
    Education – 100%.
    Health care – 100%.
    Waste management – 100%.

    To those who would like to say that if we allow foreigners to own 100% of businesses they investing or owning pieces of land, we will become foreigners in our own land is just a fear mongering tactics by coward and freeloading leftists and ultra nationalists elements of our country.

    By using their appeal to fear, Hong Kong, Japan, Singapore, South Korea, and Taiwan should have been controlled economically and politically by the United States and the European Union but instead, their respective economies caught up the US or EU GDP per capita within a generation and therefore they became a developed economy status.

    • Trevor Llewellyn Evans

      Well said!

    • TruthHurts

      “To those who would like to say that if we allow foreigners to own 100%
      of businesses they investing or owning pieces of land, we will become
      foreigners in our own land is just a fear mongering tactics by coward
      and freeloading leftists and ultra nationalists elements of our country.”

      That is already happening even with the constitutional barriers. We will simply be legitimizing that. Make it easier for foreign capitalists to lay the foundations of society to waste and leave the same when things no longer go their way.

      Is that the BEST that we could come up with? If so, then I must concede, the local race is indeed irredeemably stupid. We have nothing to be proud of at all. And that is tragically true.

      • Billy Reyes

        do you think henry sy really care deep inside his heart about Philippines & Filipinos when his company employed a lot of contractual Employees.
        Or he really care only about his empire, if you allowed Wallmart, Carefour etc, to compete with SM then he will not exploit Filipinos because no one will work at SM they will choose to work in other companies because their are choice.
        Competition bring the best environment for quality, price & benefits.

      • TruthHurts

        Do you actually think foreign investors deeply care inside their hearts about the Philippines and Filipinos?

        Do you?

        “Competition bring the best environment for quality, price & benefits.”

        Quality perhaps, but not prices, unless governments distort prices. And I’m speaking from empirical studies.

      • Trevor Llewellyn Evans

        They don’t care about the Filipino because it is about business, but that doesn’t negate the fact that competition reduces prices and increases service. Are you now claiming that business must be altruistic and a monopoly is a good thing? Keep dreaming….

      • TruthHurts

        “competition reduces prices”

        Supposedly. But that never happened, unless governments intervene which isn’t really what free market is.

        Anyway, we’re Keynesian now, and protectionism is the emerging trend (or has always been the unspoken trend)…so this whole discussion is actually moot. I will bet my life on that and we could revisit this argument in the next six months…then you tell me I’m wrong.

      • Billy Reyes

        If you bring more companies to produce goods & services then the price go down because the consumers will have more choice to buy cheap products.
        More Airline = then the fare will go lower & service is up.
        More Companies to compete with Lucio Tan, Cojuanco, Ramon Ang then you don’t buy only Toxic Tanduay, Magnolia Chicken, San Miguel Beer more option more better for us to decide what to buy.
        If we have more Shipping Companies then the Aboitiz & Razon family will not control the market. More better quality Ship, quality service & cheaper fare.
        Look at the hotel industry. The foreign companies like Shangri-la Hotel own by Malaysian provide the best employee benefits in the Philippines & they are own by foreigner. Our local employer are the one screwing Filipino’s.
        “Kapag panahon ng tag-init at sobrang dami ng watermelon sa palengke di ba ang presyo ng watermelon mura, mura na nga marami ka pang mapagpipilian di ba????
        Its the same explanation of how the COMPETITION works in a free market economy, its always bring the best otherwise your out.

      • TruthHurts

        “If you bring more companies to produce goods & services then the price go down because the consumers will have more choice to buy cheap products.”

        Ideally. But that NEVER happened. Transnational companies actually inflated things. Do your own investigation or ask any economic researcher on that.

        “More Airline = then the fare will go lower & service is up.”

        The effect among airline ticket prices is very insignificant. The price has always been that way. Service quality…maybe.

        “San Miguel Beer more option more better for us to decide what to buy.”

        I don’t know. Our beer is relatively affordable compared to beer in Korea and beer in Japan. But the last time I went to China, it was even cheaper there…German beer, that is.

        “If we have more Shipping Companies then the Aboitiz & Razon family will not control the market. More better quality Ship, quality service & cheaper fare.”

        I don’t know about that. We don’t have a relative example concerning the shipping industry, unless you’re referring to freight forwarders and couriers.

        “Look at the hotel industry. The foreign companies like Shangri-la Hotel own by Malaysian provide the best employee benefits in the Philippines & they are own by foreigner.”

        And far more expensive too.


        “Our local employer are the one screwing Filipino’s.”

        I will agree on this one.


        “Kapag panahon ng tag-init at sobrang dami ng watermelon sa palengke di ba ang presyo ng watermelon mura, mura na nga marami ka pang mapagpipilian di ba????
        Its the same explanation of how the COMPETITION works in a free market economy, its always bring the best otherwise your out.”

        Wrong equivocation. Supposedly that is the expectation. But empirical studies DO NOT support that. Iba kasi kapag may foreign intrusion, the usual rules do not apply. Because, again, it becomes political. It’s also unsustainable.

      • Billy Reyes

        “If you agree that our Local Employer are the one who’s screwing Filipino’s”.
        for that reason I rest my case.

      • TruthHurts

        But the foreign investors are also allowed to compete anyway. Did we ever close our doors to them?

        And don’t tell me that they have actually been good employers either (affording Filipinos their rightful benefits and protections as stipulated by our Labor Code). I’m referring to Chinese employers here, to be specific. Even callcenters supposedly owned by Americans and Canadians with Filipino partners haven’t really been 100% compliant to our Labor Code.

        Even in Thailand, in their Foreign Business Act, foreign ownership of certain Thai industries are limited. I will not question the wisdom of their law on that (just read it) but that wasn’t really followed anyway. Foreigners hacked the loopholes of the law which allowed thousands of foreign-controlled businesses to operate in Thailand. In the Philippines, foreign-owned companies haven’t really followed the arm-stretch of our laws either.

        That being the case. We need another strategy. And this time, the government ought to initiate the changes. It needs to provide a good model of state-owned businesses so the private sector would have a model to compete with. If we like competition (believing that competition would refine things in terms of quality and price, which rarely happened based on empirical evidence), then the government must provide the model to compete with. Either the good model provided by the government kill all private businesses, or everybody keep-up with it.

        That would work best for consumers and employees. Unless, of course, you hate the idea of having a government.

  • just_the_guy

    Sige na papasukin nyo na. Libu-libo ang magkakaroon ng trabaho sa mga kababayan natin. At saka marami din naman gustong bilhin ay mga imported. E, di ba ganun din yun?

  • eduyuuy

    noy2 doesn’t want 100 percent foreign ownership because we have millions of OFW who sent billions of dollar a year. kaya kahit papaano safe ang economy ng pilipinas. human export is our main business in the philippines.

    • Grey Eminence

      Its not noy2, but the parties that control and steer him. He is just a puppet of current day “the 400″. THEY do not want people to get wealthy or stop going OFW or call centers. THEY want the modern day (and old day) Peons of the provinces!

      • TruthHurts

        Hindi naman… Siguro meron nga, meron ganun na mga oligarchs…

        Personally, I want ALL Filipinos to be rich. Poverty must be a historical artifact of cavemen societies. Filipinos should, must take control. The remedy is not external but internal. Financing must be eased for Filipinos (even with wastage) for a period of 30 years to spur growth locally.

        This idea of always relying on foreigners is so stale already that we ought to outgrow that. It really doesn’t inspire people at all and neither does it really bring the results it promises.

Copyright © 2014, .
To subscribe to the Philippine Daily Inquirer newspaper in the Philippines, call +63 2 896-6000 for Metro Manila and Metro Cebu or email your subscription request here.
Factual errors? Contact the Philippine Daily Inquirer's day desk. Believe this article violates journalistic ethics? Contact the Inquirer's Reader's Advocate. Or write The Readers' Advocate:
c/o Philippine Daily Inquirer Chino Roces Avenue corner Yague and Mascardo Streets, Makati City, Metro Manila, Philippines Or fax nos. +63 2 8974793 to 94


  • Militants kill 14 Algerian soldiers in ambush
  • Pope Francis, huge crowd joyously celebrate Easter
  • 4 French journalists freed from Syria captors home
  • Thousands celebrate Easter in Holy Land
  • Transcript reveals confusion over ferry evacuation
  • Sports

  • Red-hot Alaska rips injury-depleted San Mig Coffee
  • Pacquiao courtesy call to Aquino set for Monday
  • Nick Calathes suspension a reminder of supplement risk
  • Teague scores 28 as Hawks soar past Pacers in Game 1
  • Warriors beat Clippers in playoff opener
  • Lifestyle

  • Angono petroglyphs in danger of disappearing
  • Britain’s baby Prince George visits Australian zoo
  • Noli Yamsuan, Cardinal Sin’s ‘official’ photographer: ‘I could smell the aftershave lotion of the Pope’
  • Simplifying and lightening life
  • Where to go for Easter night-out
  • Entertainment

  • Show-biz celebrities’ other choices of summer getaway
  • Why ‘Noah’ can’t dock his ark at Philippine theaters
  • Acclaimed artist goes wild while on holiday
  • Believing in this mermaid
  • Missing Xian
  • Business

  • Top-selling insurance agent opens her dream café
  • Connecting and transacting with one another
  • Building wealth for health
  • Why Mandaue Foam buys, rather than rents, space
  • A workplace of new possibilities
  • Technology

  • Nasa’s moon-orbiting robot crashes down
  • Netizens pay respects to Gabriel Garcia Marquez
  • Nokia recalls 30,000 chargers for Lumia 2520 tablet
  • Facebook rolls out ‘nearby friends’ feature
  • Netizens seethe over Aquino’s ‘sacrifice’ message
  • Opinion

  • Epiphany
  • Unpaid creditor vs distressed debtor
  • Moving on
  • From culinary desert to paradise
  • Response to China: ‘Usjaphil’
  • Global Nation

  • Tim Tebow’s charity hospital in Davao seen to open in 7 months
  • OFW died of Mers-CoV in Saudi Arabia, says family
  • Aquino, Obama to tackle US pivot to Asia during state visit
  • Asia seeks Obama’s assurance in territorial spats
  • Cesar Chavez movie sparks memories of Fil-Am labor leaders
  • Marketplace