Foreign investors’ entry into public services to boost economy
The ratification of the amended Public Service Act (PSA) will play an important role in the country’s economic recovery, said the Department of Trade and Industry (DTI), as it paves the way for foreign investors to enter previously restricted sectors like telecommunications, shipping and airlines.
DTI Secretary Ramon Lopez said in a statement on Tuesday that the measure will further strengthen the government’s economic recovery efforts as it liberalized the 85-year-old restrictive policy of the law. He said this will also significantly improve the country’s investment climate.
“Once President Duterte signs the bill into law, foreign equity restrictions will be eased which shall attract more global players that will modernize several sectors such as telecommunications, shipping, air carriers, railway and subways,” Lopez said.
Competition to boost quality
“Similarly, there will be increased competition in terms of services and products which will generate better quality of services and competitive pricing to the benefit of the consumers. Higher investments will also generate more jobs and income for the people,” he added.
The proposed measure classified as “public utilities” the distribution and transmission of electricity; petroleum and petroleum products pipeline transmission systems; water pipeline distribution systems and wastewater pipeline systems, sewerage pipeline systems; seaports; and public utility vehicles.
DTI Undersecretary Rafaelita Aldaba, meanwhile, noted the indirect positive impact of the PSA amendment to the entire economy.
“A more competitive services sector will have indirect consequences toward economic growth. High quality transport or telecommunication infrastructure, for example, could influence the production costs and competitiveness of all firms across all sectors of the economy,” she said.
With the economic headwinds brought by the prevailing pandemic, the amended PSA, DTI said the Retail Trade Liberalization Act, as well as the Foreign Investment Act are expected to hasten the country’s recovery from the present global health crisis. INQ
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