THE DEPARTMENT of Finance (DoF) has invited Swiss businesses to set up shop in the Philippines, citing its attractive and growing consumer market, as the government pursues reforms to streamline the investment process.
“We hope Swiss businesses could find a home here — a happy one. We are working very hard to improve the ease of doing business and reducing our [Foreign] Investment Negative List (FINL) to the bare minimum. From being mocked as ‘The Sick Man of Asia,’ the Philippines is now seen as the region’s next economic powerhouse,” Finance Secretary Carlos G. Dominguez III said during the March 6 meeting with members of the Philippine-Swiss Business Council.
Socioeconomic Secretary Ernesto M. Pernia said in February that the new FINL will be elevated to the National Economic and Development Authority (NEDA) Board for approval of its chair, President Rodrigo R. Duterte.
The FINL identifies sectors where foreign investment is either limited or prohibited. The list is reviewed every two years, but the latest version of the FINL was issued on May 29, 2015.
Foreigners can hold up to a 40% stake in companies that operate public utilities; supply materials and goods to state-run firms, government agencies, and municipal corporations; or those that operate infrastructure or development facilities which need a public utility franchise.
The government has said that it will undertake an “aggressive” removal of restrictions in its upcoming FINL.
Mr. Dominguez also touted Republic Act 10963, or the Tax Reform for Acceleration and Inclusion (TRAIN) law, during the meeting, which has helped shore up government revenue to support its infrastructure program.
“This is a good time to do tax reform because we have a leader with both the political will and the political capital to bring about meaningful change. President Rodrigo R. Duterte has thrown his full support behind the tax reform effort,” Mr. Dominguez said.
“It is also about creating economic conditions that foster investment. It is about providing a level playing field for enterprises to compete. It is about building transparent governance and simplified procedures that enhance compliance,” he added.
“The Philippines’ young and talented labor force, our large consumer market and our determined participation in building a Southeast Asian common market produce much headroom for sustainable growth,” said Mr. Dominguez.
Swiss Ambassador to the Philippines Andrea Reichlin, meanwhile, cited the positive conditions for investment in the Philippines, which is attracting attention in items such as Business Insider’s selection of the Philippines as the “Best Country to Invest In.”
“I think everybody has read the results of the Business Insider (survey). We should give a round of applause for having the Philippines in first; I think this is the first time in history,” Ms. Reichlin said.
Mr. Dominguez said that the government remains “on track” to hit its 7-8% economic growth rate this year, driven by investment.
“This is the best time to do reform. It allows us the leisure to carefully calibrate the reform measures for optimal economic impact. Free from any pressing economic distress, we have the opportunity to rally public support for this program. We are able to look far into the future and build towards the inclusive and dynamic economy our people deserve,” Mr. Dominguez said. — Elijah Joseph C. Tubayan