New telco players to boost economy
The state planning agency National Economic and Development Authority (Neda) sees the entry of a third telco player and possibly more in the future under a liberalized sector as further boosting the country’s economic growth prospects.
In a presentation at the recent Development Budget Coordination Committee (DBCC) executive technical board meeting, Neda Undersecretary Rosemarie G. Edillon said that among the government’s strategies to improve growth was an upturn of the communication sector through the entry of new telco players as well as consequent improvement of the national broadband system.
Last week, presidential spokesperson Harry Roque said President Duterte wanted a new telecommunications firm owned by the Chinese government to begin operations in the country by the first quarter of next year.
Roque had said that the President already directed the Department of Information and Communications Technology, the National Telecommunications Commission as well as local governments to approve all of the new company’s applications and licenses within seven days upon the submission of complete requirements.
The President had also warned courts not to “interfere and prolong” the process by issuing restraining orders or injunctions, according to Roque.
President Duterte earlier asked China to provide the third telco player in the Philippines to break up the PLDT Inc. and Globe Telecom Inc. duopoly, which had been blamed for the slow and spotty yet expensive internet and mobile phone services across the archipelago.
Following the invitation, Beijing chose state-owned China Telecom Corp. Ltd.
Foreign firms are limited to owning a maximum 40 percent of telecommunication operations here, hence Socioeconomic Planning Secretary Ernesto M. Pernia earlier said that China Telecom was expected to enter the domestic market through a joint venture with a local company.
But as soon as telecommunications is removed from the list of activities considered as “public utilities” under a bill pending in the Senate, foreign companies can eventually own up to 100 percent of telco ventures in the country, according to Pernia, who also heads Neda.
Pernia had said that the Neda Board chaired by the President was expected to take up the proposed 11th regular foreign investment negative list (FINL) early next year to increase the number of sectors to be further opened up to foreign investors in order to ramp up foreign direct investment (FDI).
“The revised [FINL] covers easing foreign investment restrictions on contracts for construction and repair of projects, practice of professions, telcos, teaching at higher education levels, retail trade enterprises and domestic market enterprises,” Pernia had said.
