In recent reports to the Fiscal Incentives Review Board (FIRB), investment promotion agencies (IPAs) identified the COVID-19 pandemic, high costs of doing business, and foreign equity restrictions in the Philippines as the main barriers to foreign investments in the country, among others, according to Finance Assistant Secretary and FIRB Secretariat Head Juvy Danofrata.
Assistant Secretary Danofrata, in the FIRB meeting last December 15, summarized for the Cabinet-level interagency board the issues raised by the IPAs in their recent presentations to the FIRB. In addition to the three main barriers to investment, some IPAs also stated the lack of basic utilities and quality internet connectivity as a hindrance to investments.
According to Finance Secretary and FIRB Chairperson Carlos Dominguez III, the top issues raised by the IPAs affirm the direction of government efforts to promote job-generating investments in the country.
“To address the restrictions to foreign equity, the Duterte administration has strongly supported the amendments to the Public Service Act, Retail Trade Liberalization Act, and Foreign Investment Act, which will responsibly open up our economy to more foreign investments that will benefit our people in the form of more quality jobs, products, and services. This, by the way, will also help investors and Filipino families have access to faster and more reliable internet connection. That is why it is critical that we liberalize the telco industry,” he said.
All three economic liberalization bills are in advanced stages of the legislative process.
He added that the government will continue to rapidly implement the COVID-19 vaccination program. “The vaccination of our people against COVID-19 will allow us to remove the pandemic as a determinant of how the Philippine economy performs and allow more businesses to confidently invest in the country,” according to Dominguez.
Dominguez also said that efforts to simplify government processes to achieve the ease of doing business will continue. Meanwhile, the sustained implementation of the Build, Build, Build program will help improve access to basic utilities, according to Dominguez.
As instructed by the FIRB Chairperson, the IPAs presented to the FIRB their investment promotion efforts, strategies, and leads and barriers to investments. The Corporate Recovery and Tax Incentives for Enterprises (CREATE) Law enacted earlier this year mandated the FIRB to oversee the IPAs with regard to the grant of fiscal incentives.