Corporate Securities Info

LGUs as engines of growth

/ 04:06 AM November 19, 2019

The cost of doing business in Valenzuela City has gone down.

Last week, Valenzuela City Mayor Rex Gatchalian launched the city’s Paspas Permit System, an integrated online system that would allow for the issuance of business permits within 10 minutes or so from the filing of the application.


Applicants can log on to the system from the comfort of their homes or offices and fill out the application form, submit the requirements, pay the fees and receive a temporary permit.

The permit may, however, be revoked if it turns out later the applicant does not meet the criteria.


The system is also capable of processing, among others, real property tax payments, building and construction permits and requests for copies of birth, death and marriage certificates.

This means the residents do not have to go to the city hall to file the application and incur transportation expenses and, most importantly, deal with “fixers” who promise quick processing of permits.

Trade Secretary Ramon Lopez, who graced the launch, expressed hope the system would be replicated in all government agencies.

Viewed in the context of the national economy, Valenzuela City’s online permit system may not look like a big deal considering its small population (approximately 700,000) and annual income of P3 billion, which pales in comparison to some of its neighbors.

But what is significant is the city undertook the project without being ordered to or prodded by the Anti-Red Tape Authority, the government office tasked to make it easy for the public to do business with the bureaucracy.

In lieu of the traditional and graft-prone way of processing applications for business permits, the city tapped the internet to do that task. Through this facility, the city is able to shoot two birds with one stone: minimize opportunities for graft and expedite the issuance of business permits.

No doubt, it would be a boon to the economy if other local government units (LGU) replicate this system, or adopt something similar.


For local executives who belong to Generation X or are not yet digitally attuned, this undertaking may require them to seek assistance from their internet-savvy staff.

But no worry, Gatchalian has expressed his willingness to share the system and provide technical support, free of charge, to interested LGUs.

Valenzuela City’s “ease of doing business” project validates the observation of many political analysts that national development can be best achieved through LGUs.

Meaning, if LGUs efficiently manage their political and economic affairs, their positive effects will spread to the rest of the nation. This makes sense because LGUs form the backbone of the country.

Outside of internal revenue allotments, which is based on land area and population, it is futile for LGUs to depend on the national government for additional resources or direction to improve their constituents’ living conditions or spur economic growth in their jurisdictions.

Besides, the national government, through its regional offices, sometimes meddles in the internal affairs of LGUs for political reasons, especially if the LGU head is not politically aligned with the administration.

By and large, the success of economically developed LGUs in the country may be attributed principally to the vision and competence of their leadership, rather than via the assistance from the national government.

Trade Secretary Ramon Lopez would be better off pinning his hopes on LGUs rather than on government agencies on the issue of ease of doing business.

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