MANILA On the heels of a glowing report which crowned the Philippines as the "best country to invest in," Senator Sherwin Gatchalian on Tuesday stressed that the country's dubious distinction as the "sick man of Asia" will soon be a thing of the past.
"Over the past few decades, the Philippines came to be known as the 'sick man of Asia' due to its disappointing economic performance in comparison to its Asian neighbors. Fortunately, international recognition of the country's vibrant economic outlook through rankings such as these indicates that the sick man of Asia is nearing full recovery," he said.
Gatchalian was referring to the recent Best Countries 2018 report, a comprehensive ranking released by US News and World Report in cooperation with Y and R's BAV Group and the prestigious Wharton School of the University of Pennsylvania.
Under the Best Country to Invest In category, the Philippines earned the top score among 80 countries.
According to the US News website, the ranking was generated from the input of more than 6,000 "business decision makers," who scored their perceptions of each country regarding eight attributes: "corrupt, dynamic, economically stable, entrepreneurial, favorable tax environment, innovative, skilled labor force and technological expertise."
Gatchalian, who heads the Senate Committee on Economic Affairs, also expressed optimism that the economic policies of President Rodrigo Duterte's administration would "keep our economy moving in the right direction."
He especially cited the government's PHP9 trillion "Build, Build, Build" infrastructure program, which the senator highlighted as a "crucial driving force" in strengthening the country's investment climate.
The Duterte administration's ambitious infrastructure program has been cited by respected economic ratings firms in forecasting a bullish Philippine economy for 2018 and 2019.
In December last year, Fitch Ratings upgraded the Philippines' Long-Term Foreign-Currency Issuer Default Rating to BBB from BBB-.
The global leader in credit ratings and research forecasted that the Philippines will have a real gross domestic product (GDP) growth of 6.8 percent in 2018 and 2019 due to expected higher infrastructure spending.
Fitch added that the Philippines' expected 6.8 percent GDP growth in the next two years would maintain the country's place among the fastest-growing economies in the Asia-Pacific region.
Also in December, the Asian Development Bank (ADB) raised its Philippine GDP forecast for 2018 from 6.7 percent to 6.8 percent.
In its report, the ADB said its upgraded outlook for the nation's economy assumes that growth in the government's infrastructure program will accelerate, supported by improvements in budget execution, with more large investment projects underway."
Meanwhile, Gatchalian said that his panel is deliberating additional measures that seek to further boost foreign direct investment in the country.
Among them is Senate Bill 1639, principally authored by the lawmaker, which seeks the removal barriers to entry for foreign firms hoping to invest in the domestic retail trade sector.
The current law on retail trade states that that a retail enterprise with paid-up capital of less than USD2.5 million "shall be reserved exclusively for Filipino citizens and corporations wholly owned by Filipino citizens."
The government plans to liberalize the retail trade by lowering the required minimum capital for foreign retail investors to USD 200,000, and push local players to be at par with their Association of Southeast Asian Nations (ASEAN) neighbors.
The Philippines' required minimum paid-up capital of USD2.5 million is among the highest in ASEAN.
In Singapore, foreign-owned retailers can wholly own a store in Singapore without any required minimum capital, while in Thailand foreign retailers only need a minimum capital of USD598,890 to wholly own a store.
"We have to make the most out of this opportunity to really kick foreign direct investment into overdrive by implementing the proper legal reforms," Gatchalian said.
Source: Philippine News Agency