AN economist-lawmaker has said the country’s May 2022 foreign direct investment (FDI) performance indicates that the country is on course to reach another record-breaking year for foreign investments this year, but recommended a wish list to President Ferdinand R. Marcos Jr. to sustain the country’s FDI momentum.
House Committee Ways and Means Chairman Joey Sarte Salceda listed three “immediate” priorities for Marcos to sustain the country’s FDI momentum.
“The agenda for [Marcos], which I will wholeheartedly support him in, is one, to complete a comprehensive strategic investment priorities plan, with viable plans for using tax and non-tax support to promising sectors,” Salceda said
Under the Create Law, the Board of Investments (BOI) is tasked with crafting a strategic investment priorities plan, which lists industries eligible for tax incentives and other forms of government support. The BOI has already issued what Salceda calls the “transitional” SIPP this year.
Second, Salceda said that Marcos has to resolve the leadership issue involving the Philippine Economic Zone Authority (Peza), “as soon as possible.”
“Once the leadership of the Peza is clear, we can begin charting a course for the exports sector,” the lawmaker added.
THIRD, Salceda has strongly recommended that the President release a framework of priority public-private partnership areas for his administration.
“Together with the recommendations for PPP reforms, this list will send the crucial starting signal to interested parties to PPP deals,” he said.
“The fact that we are notching record-high FDI numbers is great. The US’s rate hikes, global economic concerns and the lingering threat of Covid are very strong headwinds to overcome. Despite this, we remain a very strong investment option. That’s big,” Salceda added.
The lawmaker also said that his committee will be working on mining tax reforms to encourage more investments in the large-scale mining sector and on the Ease of Paying Taxes (EOPT) Act, which tops the policy wish-list of investor and business groups in the country.
“We are passing EOPT next Wednesday and we will begin mining tax reform discussions on that day as well,” Salceda said.
THE lawmaker noted that the country’s May 2022 FDI this year, beating the record the country set last year in the wake of the passage of the Corporate Recovery and Tax Incentives for Enterprises (Create) Act.
“We are on track to beat 2021 figures. As I have consistently said, pass Create, pass the FDI liberalization laws and the 2020s will be our FDI breakout moment. That is materializing, month after month,” Salceda said.
According to data from the Bangko Sentral ng Pilipinas (BSP), the May results brought the net inflows of FDI for January to May to $4.2 billion, an 18.8-percent jump from $3.5 billion attained during the same period last year.
On the passage of the Public Service Act amendments on March 21, Salceda said the 2020s could be “the best decade for FDI in the country’s history, or at least our FDI breakout moment if the next President gets it right.”
“Now, it is up to [Marcos] to emphasize that his administration is committed to staying the course of stronger economic fundamentals,” Salceda said. “He has made excellent personnel choices, including his economic team, which continues the long uninterrupted tradition of appointing credible people as Finance chief.”
Image credits: Nonie Reyes