European business groups in the country for the first time crafted a consolidated, comprehensive white book containing cross sector and industry specific advocacy papers, which identified crucial legislative and operational changes that the Philippine government should implement to have a more competitive environment for foreign businesses.
The advocacy papers, all aimed at facilitating market access and ensuring a level playing field in the country, were drawn up by the EU-Philippines Business Network (EBPN).
The network was co-funded by the European Union and implemented by a consortium of European business organizations based in the Philippines.
The recommendations were deemed crucial at this juncture as the Philippines is currently experiencing strong and sustained economic growth ahead of the establishment of the Asean Economic Community (AEC) by yearend.
Henry J. Schumacher, vice president for external affairs of the European Chamber of Commerce of the Philippines Inc. (ECCP), noted in a briefing on Tuesday that this was a good time for the government to implement the proposals as foreign firms were increasingly looking at the Philippines as potential site for a regional hub.
Also, European manufacturing firms may take advantage of the country’s inclusion in the EU’s new generalized system of preferences (GSP+). Under this scheme, over 6,200 lines of products manufactured or produced in the Philippines may be exported to Europe with zero duties.
There are proposals that can readily be addressed by the government in the remaining 13 months of the Aquino administration, Schumacher said. But there are also the more complex ones that will have to undergo legislation and may thus take time.
ECCP president Michael Raeuber similarly underscored the importance of heeding the proposals, explaining that while the country is well on its way to become a major Asian player on the global market, the Philippine government and the private sector must ensure that the necessary foundations are laid to ensure that the rapid economic growth will translate into long term, sustainable and inclusive growth.
“European business can and is willing to join hands with Philippine partner organizations and local companies, including small- and medium-sized enterprises to achieve this goal by generating quality employment, transferring valuable technology and expertise, providing a wider choice of products in the market, which will benefit the quality and cost of products reaching the Filipino consumer,” Raeuber said.
“Legislative reforms that reflect changing market needs and match what competing markets are offering are crucial. A fair competition law, the enactment of the Customs Modernization and Tariff Act, the adoption of the co-loading bill, and the removal of professions from the Foreign Investment Priority List need to be prioritized,” Raeuber added.
According to EBPN, there were nine cross-sector papers. Most stressed the need for the Philippines to further liberalize its economy by revising the Foreign Investment Negative List (FINL); to enact the national Fair Competition Law; amend the Government Procurement Reform Act; rationalize fiscal incentives without having to remove the provision for income tax holidays; and enact the Customs and Modernization Tariff Act.
EU ambassador to the Philippines Guy Ledoux said the recommendations were consistent with some of the experiences of European industry in the Philippines, and were all deemed important for the country’s continued economic development.
The implementation of these proposals is also described to be key determinants for further trade engagement with Europe.