Our economy seems to be doing well with an impressive growth rate at over six percent last year – prompting officials to say we could even hit nine percent this year. Everybody knows that a major contributor has always been the remittances from our overseas Filipino workers that amounted to almost $27 billion last year. But there is no question that we could do much, much better if we attract more foreign investments into the country by lifting the overly protectionist provisions in our Constitution. A report by the Economic Research Institute for Asean and East Asia (ERIA) affirmed that the Philippines has one of the most restrictive policies compared to its neighbors. As a matter of fact, the inflow of FDIs was reduced to almost half for the first three months to  $851 million compared to the $1.75 billion covering the same period last year.

A recent report released by the UN Conference on Trade and Development (UNCTAD) noted the Philippines continues to lag behind its ASEAN neighbors such as Singapore whose FDI reached $67.5 billion – over 10 times more than what the Philippine managed to attract. Most of our neighbors are hitting double digits and even Vietnam has overtaken us with a steady increase in FDI inflows from $7.6 billion in 2009 to $9.2 billion last year. In contrast, the Philippines only managed to attract $6.2 billion in 2014.

In 1990, the Philippines was way ahead of Vietnam with the latter’s FDI inward stock only totaling $243 million compared to the Philippines with FDI placed at $3.6 billion. By 2014, Vietnam’s FDI inward stock already reached $90.99 billion – a third more than the Philippines’ $57.093 billion.

Businessmen are definitely concerned especially with the decision of Vietnam to lift ownership caps on listed companies – a move obviously designed to attract and encourage the inflow of more foreign business and investments. But all is not lost, as the Philippines has a fighting chance to keep pace with – if not outpace – our neighbors including Singapore.

That is, if policymakers and lawmakers are serious enough to enhance the local business environment that has largely been perceived as hostile to investors and investments. Aside from poor infrastructure, high taxes and an unpredictable policy climate as seen in government’s tendency to change rules midstream and renege on contracts made with the private sector, a major turn off for the international business community is the over protective Constitution.

Unfortunately, the House Resolution (actually Resolution of Both Houses or RBH) principally authored by Speaker Sonny Belmonte supporting the amendment of certain economic provisions in the Constitution has been withdrawn and sidelined. As Philippines, Inc. president Tony Lopa observed, the approaching deadline for the creation of an Asean Economic Community should nudge the Aquino administration into supporting the calls to amend the economic provisions of the Constitution by way of Speaker Belmonte’s resolution. By relaxing the limitations on foreign ownership, the Philippines would be able to maximize the benefits of Asean integration and generate much-needed jobs for Filipinos.
Indeed, if we want the Philippines to be able to compete globally and promote the country as an attractive investment destination, then we must make our policies at par with global standards, and relaxing ownership limitations should be one of them.Bower Group Asia country director and think-tank group Stratbase Albert del Rosario Institute president Professor Dindo Manhit correctly pointed out “the limits set by the country’s Constitution on foreign equity in real estate and in key industries has set up a half open and restrictive business environment that has frustrated the influx of much needed FDI.” In short, Manhit is saying the Philippines is only “half-open” for business.

DOTC voted the worst department ever

Secretary Jun Abaya is a good man, but unfortunately this goodness must be reflected in terms of the competence level provided by the Department of Transportation and Communications and the agencies under his turf, among them the Land Transportation Office which is turning out to be the worst ever under this administration. The recent floods due to Typhoon Egay spawned complaints about car license plates getting damaged or deformed – and the LTO just seems to shrug this off by saying they will replace the damaged plates at no cost – something that is totally unacceptable to car owners who are seething because they have to shell out an extra P450 for plates that are of such poor quality and a lot inferior than the old ones.

LTO is running out of alibis and excuses as to why the delivery of plates and stickers continues to be delayed – the latest of which is that disgruntled employees are sabotaging the agency. Such cavalier attitude only feeds the frustration and the anger of the riding public.

If there’s anything that ticks a lot of people off, it’s the inefficient MRT system (add the alleged corruption), colorum vehicles, and related issues like traffic that are making life hell for commuters almost every single day – and no politician seems to be even interested in these issues. The way we see it, Grace Poe is the only one who is taking the MRT and other DOTC-related issues seriously, knowing fully well that these go deep to the level of the working and riding public.

Source: http://www.philstar.com/business/2015/07/09/1474736/vietnam-overtaking-philippines