BRITISH COMPANIES are looking at doubling their foreign direct investments into the Philippines this year, with the government’s infrastructure push seen as its biggest attraction.
“Our outlook on FDIs is going to be two-fold,” British Chamber of Commerce of the Philippines (BCCP) President Chris Nelson told BusinessWorld last week in Makati City.
“I think potentially UK companies will look at the infrastructure projects. Can they be involved? We have one member who is very interested in the railways. I think there will be engineering companies. And also of course it depends on how the government goes. Is it a hybrid, where there is more private partnership, away from the ODA, then there will be more interest, “ Mr. Nelson added.
FDIs from the United Kingdom surged to $37.91 million during the January to October period, from the $8.14 million in the comparable period in 2017, according to data from the Bangko Sentral ng Pilipinas.
Mr. Nelson said the investments will go with the flow of the much needed liberalization of sectors which currently have foreign restrictions.
“The economic liberalization could have at least a clear path forward. Then I think that is a great incentive for companies to come,” he said.
The BCCP, for instance, had been pushing for the relaxation of requirements under Republic Act 8762 or the Retail Trade Act of 2000 to give foreign retailers greater access to the local market.
The current law requires foreign entities to have a $2.5-million capital requirement before owning 100% of a retail establishment.
Mr. Nelson also noted the need for the government to address British firms’ concerns over the second package of the tax reform law, or the Tax Reform for Attracting Better and High-Quality Opportunities (TRABAHO), which diminishes tax incentives given to PEZA locators.
“We obviously have companies in the PEZA (Philippine Economic Zone Authority) zone and I want some of the points they are raising on TRABAHO taken into consideration,” he added.
The BCCP has at least 288 member-companies with interests in retail, education, tech/logistics, machineries and infrastructure. — Janina C. Lim