Cha-cha reaches House plenary floor
MANILA, Philippines — The push for charter change (Cha-cha) has now reached the plenary floor in the House of Representatives.
During Monday’s session, the lower chamber opened the period of sponsorship and interpellation for Resolution of Both Houses No. 2 (RBH 2), which proposes economic amendments to the 1987 Constitution.
In sponsoring the proposed Cha-cha, House committee on constitutional amendments chairperson Ako Bicol Partylist Rep. Alfredo Garbin Jr. said amending the economic provisions of the Constitution would give the government enough flexibility in the country’s road to economic development.
Under the RBH 2, the phrase “unless otherwise provided by law” would be added to the constitutional restrictions that limit the participation of foreign investors in the governing body of entities based on their proportionate share in the capital.
The same phrase would likewise be added to provisions saying only Filipino citizens can control, own, and/or lease public utilities, educational institutions, mass media companies, and advertising companies in the country.
“Nationalist groups do not see any benefit to further opening the economy to foreign capital. They point out that domestic enterprises are not yet prepared to compete with foreign corporations that are equipped with huge investments and advanced technologies,” Garbin said.
“What is of greater urgency for the government to address are the factors that are the main disincentives to the massive entry of foreign direct investments, such as inadequate infrastructure, graft and corruption, bureaucratic red tape, influence peddling, and high costs of doing business,” he added.
Garbin said the “restrictive” economic provisions of the Constitution “have given rise to monopolies and oligopolies by some Filipino-owned industries at the expense of consumers.”
“We should not be afraid to compete in today’s globalized environment. In any case, the removal of these restrictive provisions through constitutional amendments cannot prevent the Congress when faced in the future by changing circumstances and new challenges, from introducing restrictions for national security and other ‘national interest’ reasons once we have attained our foreign investment targets and have sufficient capital from our domestic savings,” Garbin said.
Meanwhile, House committee on ways and means chairperson Joey Salceda compared the situation of the Philippines to Vietnam, saying that the latter “is the clearest evidence that we should not have tied our own hands behind our backs in attracting foreign investments.”
“Vietnam began to loosen its foreign direct investment (FDI) restrictions in what was known as the ‘Doi Moi’ reforms, starting 1987, with a new Foreign Investments Law. Around the same time, we began a more restrictive investment regime, with the foreign ownership rules enshrined in the 1987 Constitution,” Salceda said.
“The figures from that era onward, for both countries, show a history of contrasts. As Vietnam opened its economy, FDIs began to flow. Vietnam began to overtake us in FDI-to-GDP by 1990, just 3 years after Doi Moi and the 1987 Constitution,” he added.
Salceda said that while he does not see amending the Constitution as a “magic wand for all of our problems,” it is “a necessary beginning.”
“My own estimates are that we stand to gain a total of 6.6 million jobs, if we immediately follow RBH 2 with the right enabling laws,” Salceda said.
Supporters of cha-cha did not only come from the House’s majority bloc.
Deputy Minority Leader Rep. Stella Luz Quimbo, an economist, said that amending the Constitution is “overdue.”
“Bakit natin kelangan buksan ang ekonomiya? Simple lang po. Kulang ang kapital ng mga negosyanteng Pilipino. Ano ang ebidensya? Ang 2.2 million na OFWs. Dahil kulang ang kapital sa ating bansa, kulang ang trabaho para sa ating mga kababayan,” Quimbo said.
Further, Quimbo said the coronavirus pandemic also highlighted the need for foreign direct investments in the country that impacted the economy.
“This resolution is one necessary step towards the creation of a fairer and more dynamic business environment, one geared towards maximizing benefits for the Filipino people. Hindi po dayuhan ang panalo sa panukalang ito kundi Pilipino,” Quimbo said.
The House committee on constitutional amendments earlier adopted RBH 2 even as critics questioned its timing especially as the country grapples with the coronavirus pandemic. Critics likewise feared that the proposed charter change will include political provisions such as term extension for lawmakers.
However, Garbin has repeatedly assured that the proposed charter change will only cover the economic provisions of the 1987 Constitution.
