Aussie firms lament cost of labor in PH
Australian investors pointed to the cost of labor as the biggest challenge affecting their businesses here, according to a survey.
Having the least impact a year ago, cost of labor rose to the top of the list that also saw perennial woes including government bureaucracy, traffic congestion and the tax system.
Based on the Australian Business in Asean Survey 2017 released on Saturday, these challenges “were all identified as having a high impact by more than 40 percent of [Australian] businesses.”
Government bureaucracy topped last year’s survey, with 78 percent of businesses identifying it as having the biggest impact on the Australian business community. This year, it only placed second.
According to the survey, Australian businesses in the country are mostly services firms. Moreover, 45 percent of the members in the community have been operating here for ten years or more.
In the Asean region, meanwhile, corruption was cited as the topmost concern.
In the case of the Philippines, 20-40 percent said corruption was also an issue. It placed fifth in the current survey after ranking fourth last year.
“The second iteration of the Australian Business in Asean survey revealed that while challenges remain, firms continue to enter the region and many are actively planning to enter new markets in the next few years to respond to the opportunities inherent in Asean’s emergence,” the survey read, however.
It noted more than 86 percent of firms planned to increase their investments in the Asean region over the next five years. Less than two percent of businesses, meanwhile, are planning to reduce their regional presence.
“Vietnam has overtaken Myanmar as the most popular market for expansion, but Myanmar, Indonesia and the Philippines were also targeted by more than 15 percent of firms for expansion,” it added.
In a press briefing, Australian and New Zealand businesses backed calls to remove the restriction on foreign contractors provided in the Philippines’ investment negative list.
Australia-New Zealand Chamber of Commerce (ANZCham) president Tom Grealy said the slow pace in the implementation of the Duterte administration’s infrastructure projects was a “concern.”
“Everyone supports the ‘Build, Build, Build’ [initiative] but you need the help that [Socioeconomic Planning Secretary Ernesto M. Pernia] was signaling. We want the support of foreign companies. Australia has some of the world’s best consultant engineering firms,” he said.
Pernia announced in a recent forum the lifting of the restriction on international contractors’ participation in infrastructure projects formed part of the government’s move to further liberalize the country’s foreign investment negative list (FINL). The list, which is reviewed every other year, sets the limit of foreign investments in certain industries and economic activities.
“There is a huge opportunity that is aligned with the opportunities of the current administration,” he said.
