By Chino S. Leyco
The Department of Finance (DOF) is bent on opening up the country’s economy further by lifting some economic restrictions stipulated under the Regular Foreign Investment Negative List.
Finance Secretary Carlos G. Dominguez III said the Duterte administration wants to open more business areas to foreign investors by reviewing the list of investment activities reserved for Filipinos in May next year.
The Regular Foreign Investment Negative List was last promulgated by the Aquino administration in May last year through Executive Order No. 184.
The EO has enumerated the investment areas and activities reserved exclusively for Filipinos as well as industries where foreign equity of up to a maximum of 40 percent is allowed, as mandated in the Constitution.
Under the 2015 Negative List, 100 percent foreign participation is allowed only for retail trade enterprises under certain conditions specified in Republic Act 8762 or the Retail Trade Liberalization Act and also in the rice and corn industry under certain conditions.
The 2015 list also allows full foreign participation in the exploration, development and utilization of natural resources through financial or technical assistance agreements with the President.
“There are two ways we can lift the restrictions in the Philippines. One is there are administrative restrictions. It’s called a negative list, and these are areas where administratively, the government does not allow more than an ‘X’ amount of percent of foreign ownership,” Dominguez said.
“The window will open for us to review that in May of 2017 and certainly, the economic team is going to look at lifting administratively some of those restrictions,” he added.
Dominguez mentioned this anew during the panel discussion on opening day of the Philippine Development Forum (PDF) in Davao City last week.
Dominguez explained that the review of the Negative List is just the initial step as the Duterte government wants Congress to enact a long-term approach to further liberalize the economy by amending the provisions restricting foreign ownership in all areas of the economy, except land.
However, Dominguez said Malacañang cannot commit to a specific timeline as to when the economic restrictions would be lifted, because it is up to the Congress, a co-equal branch of government, to initiate it.
The committee on constitutional amendments of the House of Representatives has already approved a resolution calling for the convening of the 17th Congress as a Constituent Assembly (Con-Ass) to amend the Constitution.
The Senate will start its Charter change debates early next year, and has yet to decide if it will agree to a Con-Ass or call for a duly-elected Constitutional Convention (Con-Con) to review the Constitution.
“Either way, it’s not going to happen tomorrow, it’s going to take a bit of time. Now, according to the President, he wants to open all areas of the economy to foreign investment with the exception of land, which is a very cultural and touchy issue,” Dominguez said.