• ‘Ease foreign investment limits,’ US official urges PH

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    THE Philippines must ease restrictions on foreign investors and improve infrastructure to attract more investment, particularly from the United States, as crucial steps to expanding trade and growing the economy, a US official said.

    “The Philippines is one of the most restrictive countries in the world against foreign investment, with more barriers than any other large Asean country,” US Embassy Manila Trade Officer Brian Breuhaus said in a statement over the weekend.

    The constitutional restrictions on foreign investment, widely known as the 60-40 rule, must be relaxed, Breuhaus said.

    The Constitution stipulates that only Philippine nationals are allowed to operate a public utility. This applies to nearly all public-private partnership (PPP) projects.

    “No American firms have been involved in a PPP, and no foreign firms have taken the lead on a PPP, even though they could provide a huge amount of expertise. This would take a constitutional change,” Breuhaus said.

    The Philippines can also relax the limits set under the Foreign Investment Negative List, he said.

    Breuhaus underscored the need for better infrastructure, including roads, airports, seaports and internet connectivity.

    For a start, a Single Window in Customs could make it easier for goods to be shipped here. The Trade Facilitation Agreement at the World Trade Organization must also be approved, the US official noted.

    “This [Single Window] is a promise the Philippines has made under Asean,” Breuhaus stressed.

    The US is among the largest foreign investors in the Philippines, with a current stock of $4.7 billion in Philippine placements.

    The Philippines is the 30th largest source of US merchandise imports, and the 32nd largest export destination for US products.

    Breuhaus noted the US-led Trans-Pacific Partnership Agreement (TPP) promotes economic growth, creates jobs and opportunities, and deepens economic integration in the Asia Pacific region.

    The TPP covers 40 percent of global gross domestic product and 30 percent of world trade.

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    3 Comments

    1. One subterranean basis of the restrictions in the Consti, I’m afraid, is the vested interest deeply kept by our legislators. March in foreign investments, and that will put those powerful men’s self-interest in jeopardy. Meantime, the Phil business environment paces like a turtle in its progress… and millions of Filipinos wallow in poverty.,

    2. michael schneider on

      very interesting comments from the US Embassy about the things that hold
      philippines back.

      one of the policies that helped build America, Australia, UK and others into prosperous nations, was the active encouragement of importing brain power from around the world to help run that particular country.
      For example, the Sydney Harbour Bridge, The Sydney Opera House and the Snowy Mountains Hydro Electric Scheme were not designed and built by the typical beer swilling Aussie yobbo. Rather consultants were brought from the far corners of the globe.
      If Philippines continues with its tribal incestuous attitude of only allowing Filipino nationals to hold all the top jobs, it would appear to be contrary to Worlds Best Practice

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