Foreign investments key to dev’t, lawmaker insists

MANILA, Philippines — Despite assertions that dealing with corruption and governance quality is more important than removing ownership restrictions in the Constitution, one of the top economists in the House of Representatives insisted on his assumption that foreign equity restrictions are hindering the full potential of local industries.

Albay Rep. Joey Salceda, a respected financial analyst before entering politics, said several industries, like transportation and financial services, have high returns on equity “but their full potential is being hindered by the Constitutionally-mandated foreign equity restrictions.”

“Transportation, 21.47 percent; railroads, 22.73 percent; financial services, 61.83 percent. These have a high ROE which invites competition,” said Salceda, House ways and means panel chair, during a hearing of the House constitutional amendments committee on Tuesday.

The hearing featured American businessman and former diplomat John Forbes, a longtime resident of the Philippines and senior adviser of the American Chamber of Commerce of the Philippines.

Forbes identified several industries that may interest American businessmen and lamented that the Philippines has “kept out more capital coming into electricity, particularly into renewable energy” amid its available resources for solar energy or wind turbine farms.

Forbes added that other sectors, which could be opened up to foreign investors for capital are manufacturing, media, telecommunications, delivery services and marine ferry services.

“You can make the Philippines a global hub for advertising,” said Forbes, adding that the country can be a regional hub for education, like what happened to Singapore “with European and American universities investing.”

Salceda noted other industries, which could become attractive to foreign investors are cable television, farming and agriculture, brokerage and investment banking, and investments and asset management.