THE business community has thrown its support to the coordinated efforts of the two legislative chambers to change the economic provisions of the 1987 Constitution, particularly, the easing or removal of foreign investment restrictions in some industries.
In a joint statement over the weekend, 13 local and international business groups said they fully support the Resolution of Both Houses 1 (RBH1), which proposes amendments to Articles XII, XIV, and XVI of the Philippine Charter.
Principally authored by House Speaker Feliciano Belmonte, Jr., the resolution seeks to include the phrase “unless otherwise provided by law” in some sections of Articles XII (national economy and patrimony), XIV (education, science, and technology, arts, culture and sports), and XVI (general provisions).
RBH1 has been approved on second reading in the plenary, but the third reading vote requires the approval of three-fourths of the members of the House.
Belmonte has placed passage of the resolution among his highest legislative priorities during the recently resumed House session.
“Senate president Franklin Drilon has committed to our business groups that the Senate will discuss the counterpart resolution in the Senate authored by Senator Ralph Recto after RBH1 is approved by the House,” the businessmen’s joint statement said.
The statement further read: “Since the year 2000, Filipino business leaders and economists have recommended replacing the constitutional restrictions on foreign equity with specific laws. RBH1 is the first serious effort to undertake this often-recommended reform. The constitutions of almost all countries in the world do not contain restrictions on foreign investment. Most countries who do impose some restrictions on foreign investment do so through legislation or administrative orders that can be changed to suit shifting national priorities.”
If approved by Congress, and subsequently in a plebiscite, the amendments would allow Congress to pass future laws to change the current constitutional restrictions.
“Much has changed in Asia since the restrictions were placed in the 1987 Constitution,” the businessmen pointed out. “The Philippines has joined the World Trade Organization, agreed to open trade and investment within Asean and with Asean Plus partners Australia, India, Japan, Korea and the People’s Republic of China.”
Recently, the ambitious Trans-Pacific Partnership was agreed upon by 12 countries, which account for 40 percent of global GDP.
“Because the TPP provides for minimum barriers to cross-border investment flows among members, the Philippines may not be able to join unless some restrictions can be reduced,” the businessmen said.
The Philippines’ population has more than doubled since 1987, they added.
“Amidst this development, the largest economic challenges are high poverty levels, ensuring inclusive growth, and reducing underemployment,” they said. “The Philippine government should maximize the amount of foreign investment generated as a means to drive down unemployment and underemployment levels.”
According to the business groups, there have been only two significant liberalizations [covering casinos and retail trade]in the Foreign Investment Negative List over the more than two decades since the important 1991 reforms in the Foreign Investment Act.
Constitutional restrictions on foreign ownership on certain industries will remain until Congress and the President enact specific laws to remove or amend them, they stressed.
“It is our strong position that there is no better time than now to begin the process of updating the outdated restrictions in our Constitution through RBH1,” they said.
The statement was signed by: the Federation of Filipino-Chinese Chambers of Commerce and Industry, Financial Executives Institute of the Philippines, IT and Business Process Association of the Philippines, Makati Business Club, Management Association of the Philippines, Semiconductor and Electronics Industries in the Philippines Inc., American Chamber of Commerce of the Philippines, Australian-New Zealand Chamber of Commerce of the Philippines, Canadian Chamber of Commerce of the Philippines, European Chamber of Commerce of the Philippines, Japanese Chamber of Commerce and Industry of the Philippines, Korean Chamber of Commerce and Industry of the Philippines, and Philippine Association of Multinational Companies Regional Headquarters Inc.