• ‘Economic cha-cha’ a step in the right direction

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    WE are encouraged by the action of the House of Representatives earlier this week in quickly passing the so-called economic cha-cha (charter change) bill, formally called Resolution of Both Houses 1 (RBH-1), through its second reading. This advances the charter change measure one step farther in the legislative process than it has ever reached before, and improves the chances – if only very slightly – that the constitutional amendment will become a reality.

    RBH-1, which was co-authored by Speaker Feliciano Belmonte Jr. and Sen. Ralph Recto, seeks to enable the removal of constitutional restrictions on foreign ownership of Philippine businesses and property mainly through the insertion of the phrase “unless provided by law” into the relevant provisions of the Constitution.

    Business groups, economic analysts, and an embarrassingly large number of potential foreign partners in both the government and private sectors regularly cite restrictions on foreign investment as the biggest obstacle to economic progress in the Philippines. Support for the measure is widespread among Filipino businesses, even with the full knowledge that liberalizing investment will increase competition in many industries – including, we must note, the print and broadcast media.

    Approaching liberalization in the way RBH-1 proposes is the most sensible alternative; it does not actually lift existing restrictions, but simply authorizes their modification by ordinary laws that can be more easily amended to suit changing circumstances in the future. Liberalization can proceed at a manageable pace, giving Filipino businesses and consumers time to adjust.

    Reality, unfortunately, dampens any optimism that Congress will prioritize good sense over political maneuvering and pass the measure on its all-important third reading. The passage of RBH-1 on its second reading without a single objection, not even from the left-leaning party-list groups who are traditionally strongly opposed to liberalization, might be a hint of the sort of grandstanding we can expect to see from cha-cha advocates and opponents when the third reading takes place (no schedule has been set for it yet). In this week’s session, the representatives in attendance seemed to be saving their energy for the show that will take place in front of the full House and extensive media coverage.

    And there are definite risks to liberalization that must be acknowledged. The benefits will not be uniform; foreign investment will create new businesses and jobs, but some other businesses and jobs will be lost. Ordinary Filipinos may feel other adverse effects, such as fluctuating consumer prices. A more liberal investment environment also creates new opportunities for corruption and abuse.

    The solution to all those risks is simply proper governance and management, but the fact that government has too often shown a less than comprehensive grasp of those concepts should not be a deterrent. Institutional performance needs to improve whether there are increased foreign investments or not, but it will improve faster if it is rewarded with increasing investments.

    President Aquino’s presidency has achieved very little. The only solid accomplishments are in education, where the classroom shortage has apparently been solved and, the laudable implementation of the K-to-12 basic education system for the past five years has been bringing us closer to the global standard. But advancing the “economic cha-cha” measure to at least the point where the required plebiscite can be conducted could easily become another Aquino regime accomplishment. We suggest that the President and his allies and opponents alike not let the opportunity escape.

    But don’t let foreign ownership lead to more poverty
    A great fear of a large part of our population is that making the Philippines more open to foreign investors will only make the Filipino poor poorer, while the rich continue to be richer.

    One of the most worrisome aspects of allowing non-Filipinos to become sole owners of real estate is that it might make owning homes even more prohibitive than it is now for the 50% of our population who are poor and only barely non-poor.

    As in Singapore, a government program to make every family a homeowner must be launched here, properly funded and managed.

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    9 Comments

    1. It is the right thing to do. These measures just seek to de-constitutionalize policy setting which rightfully belongs to congress. These will be approved by the people in a plebiscite so we’re still a long way.

    2. Braincleaner on

      Even now that foreign corporate dominance in the economy have created a condition of mass poverty and underdevelopment. Where practically everything we use for daily survival is foreign. Where prevailing conditions of shortage of money plundered by foreigners resulted in massive debt trap we can never pay. Economic Cha Cha in furtherance of prevailing economic structures is a seal for total national destruction! A win for economic Cha Cha would show an entire nation with no working brains in possession.

    3. jason bourne on

      It will lead to the poor becoming poorer & the rich, richer. Cambodia is a prime example.

    4. Mariano Patalinjug on

      Yonkers, New York
      29 May 2015

      Now, finally, the Congress has come to its senses. Liberalization, by way of removing constitutional restrictions on foreign ownership of Philippine businesses and property, is a step in the right direction.

      The Charter Change Bill [RBH1], which reportedly has passed the House on second reading, is designed to do just this, simply by the insertion of the phrase “UNLESS PROVIDED BY LAW,” to the Constitutional provision in question.

      There will be “negatives” to liberalization, for sure. But, overall, the positives will very likely outweigh these. The country will benefit from more foreign investments which are bound to provide jobs to countless Filipinos who yearly join the bloated Labor Pool but are not able to find the jobs they need because there are none available, forcing an average of one million of them to join the Great Diaspora to any one of 191 countries on our planet as OFWs.

      MARIANO PATALINJUG
      Lapulapu1927@yahoo.com

    5. Why not let 100 percent of ownership of industrial & commercial land open to foreigners. Keep the residential and agricultural land for Filipinos only.

    6. Vic PenetranteVic on

      The poorest of the representatives, Fernando Hicap, said, “Poor doomed as Cha-cha looms.”

    7. Congress is not to be trusted in creating any cha-cha. Look at how the House acted. It talked about how it was removing 8 sections that were unconstitutional and then at the last minute reversed and passed the BBL untouched. So how can we trust them to do what they are saying. Will they start with economic provisions and then at the last minute change to delete term limits?

    8. binibenta n nman ang bayan natin nang mga politiko n yan eh. Paano ngayon nyan, tayong mga common na tao/ masa, nagsisikap, pagdating nang panahon anak natin o apo natin,nakaipon pambili nang property, eh ano pa mabibili nya,pagmamay ari na ng mga dayuhan halos lahat, at kung may naiwan p man,di na kaya abutin kasi mahal na masyado. yang mga dayuhan,ngayon p lng mapepera n yan eh. Tayo mag iipon pa lng.
      Ang dapat ayusin nila dyan ay ang redtape at buryukrasya sa gobyerno para makapasok foreign investment nang maayos.
      Sa south nga eh, digging permit pa lng para sa telecoms cable, hinihingan na nang 1M nang mayor/vice mayor… kesyo alam na may foreigner na contractor.
      Tsk tsk tsk. paano na ang bayan kong pilipinas,kung ganito lang palagi mga politiko natin…… we are getting worse by the years..

    9. Bakit ang mga hanggal na tao,mga matatalino naman!ang sinisisi ay ang batas,kahit paulit-ulit man baguhin ang batas,kung masasama ang nagpapatupad at namumuno dito,at puro pagnanakaw at pangsariling pakinabang ang nasa mga utak nito,wala!!walang perpektong batas na mabubuo ng tao,dahil wala sa batas ang problema nasa mga demonyong tao na nagpapatupad nito!
      Kung mabuti ang gobyerno,at ginagawa nilang tama ang trabaho,wala sigurong naghihirap at naghihikahos,!
      Madumi lang talaga ang marami,kaya magulo!
      Wag ninyo ng paikot-ikutin pa,para sa inyo lang ang pakinabang na mayroon sa pagbabago!