The
Philippine government has committed to allow foreigners to invest in more
industries and practice more professions locally by reducing the number of
items in the Foreign Investment Negative List.
At the mid-year economic briefing last Friday,
Economic Planning Secretary Cayetano Paderanga said this was one of the things
that the government would be working on to make the local investment
environment more attractive to foreign investors.
"Our aim is to make the Foreign
Investment Negative List as short as possible. Those that will remain on the
list are those that are covered by constitutional restrictions," Paderanga
said.
National Competitiveness Council co-chairman
Guillermo Luz agreed with Paderanga’s statement, saying a shorter negative list
would help jack up the country’s competitiveness.
However, he warned against tweaking the
Constitution to allow greater foreign participation in industries and
employment, saying this was not the right time to do so.
"We’ll just try to make the list as
practicable as possible," he said. American Chamber of Commerce of the
Philippines senior adviser John Forbes further challenged the government
officials on the panel, saying the negative list has not had changes in the
past 20 years.
Finance Secretary Cesar Purisima countered
this by saying that there had been some changes over the past years, including
in mining, which allowed 100-per cent foreign ownership, and retail trade,
which allowed full foreign ownership at a minimum paid-up capital of US$2.5
million.
"Upwards of 90 per cent of economic
activities are open to foreigners. You keep looking at the ‘empty’ portion
rather than the ‘full’ portion. The government does have to still work on this,
but the list shouldn’t stop foreigners from investing," Purisima said.
Under the negative list, industries that did
not allow any foreign ownership included mass media (except recording), retail
trade enterprises with a paid-up capital of less than US$2.5 million,
cooperatives, private security agencies, small-scale mining, cockpits,
firecrackers and pyrotechnics, and marine resource utilization in archipelagic
waters, territorial seas, and exclusive economic zones.
The list also limited foreign ownership to 20
per cent in private radio communications networks; 25 per cent in private
recruitment for both local and overseas employment, construction of
defense-related structures, and repair of locally funded public works, except
infrastructure or development projects covered by Republic Act No. 7718 and
foreign-funded and foreign-assisted projects that undergo international
competitive bidding; and 30 per cent in advertising.
Abigail L. Ho
Philippine Daily Inquirer
Business & Investment Opportunities
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