The House Committee on Constitutional Amendments expects to finish deliberations on the proposed revisions on the restrictive economic provisions of the 1987 Charter so it can endorsed them for plenary deliverations by February.
Ako Bicol Rep. Alfredo Garbin Jr., panel chair, said they would come up with a committee report on the Resolution of Both Houses (RBH) No. 2 after a few more hearings.
Asked at a recent media forum on the timing of the proposal, Garbin said there is a need to address obtaining economic challenges and recommend sound policies to send a positive signal to the international business community.
“We want to send the signal to the business community that we are now open and that the restrictive policy will be lifted. We want to better our position or business climate; we want to be proactive in promoting investments,” he said.
Citing data presented by the Organization of Economic Cooperation and Development (OECD) and World Bank, Garbin said the Philippines is at the top of the most restrictive economies in the world.
The OECD data, he said, further show that countries with restrictive policies receive less foreign direct investments (FDIs) as compared to others like Singapore, Vietnam, Thailand, Malaysia and Indonesia.
He noted that the Philippines is not only geographically isolated but is also economically because of its overly restrictive policies.
A paper prepared by the UP Research and Extension Services Foundation-Regulatory Reform Support Program for National Development (UPPAF-RESPOND) said as many as 1.6 million jobs would be created if the restrictive economic provisions of the Constitution are amended to open up the economy to foreign ownership.
UPPAF-RESPOND said easing the constitutional provisions that bars foreign ownership on certain industries would cut down joblessness rate by 40% to 5.1% from 8.7% as recorded in October 2019.
“The new jobs will totally offset the annual job losses in domestic trade, finance, real estate & business services, and allow significant job recovery in manufacturing (38%), construction (35%), other services including health and tourism (25%) and transport & storage (19%), the preliminary study by UPPAF-RESPOND said.
The paper was submitted to the House of Representatives. by Dr. Enrico Basilio, RESPOND chief and professor at the UP National College of Public Administration and Governance,
According to the study, the removal of all foreign equity restrictions, or allowing 100-percent foreign ownership in all economic activities, is equivalent to the improvement of the foreign equity ratio of 0.281 in 2019 to zero, which translates to a nominal increase of FDI amounting to US$16.2 billion.