THE National Economic and Development Authority (NEDA) hopes to complete the draft list of industries restricted to foreign investment by the second half, after its regular release date was pushed back by the pandemic.
The proposed 12th Regular Foreign Investment Negative List (FINL) will be presented to President Rodrigo R. Duterte later in the year, Acting Socioeconomic Planning Secretary Karl Kendrick T. Chua told BusinessWorld last week.
Asked if the upcoming list will offer a less restrictive environment for foreign investors, Mr. Chua said via Viber: “That is in the process of review.”
“There are limits to the FINL since some require legislation, so we need to also pass the PSA (Public Service Act), RTL (Retail Trade Liberalization Act), and FIA (Foreign Investment Act) amendments,” he added, noting that the treatment of these industries will be a priority in the new list.
The three bills have been approved on third and final reading at the House of Representatives.
Their counterpart measures in the Senate, however, are still at various levels of approval, with the bills amending the PSA and FIA still in committee. The retail bill amendments are awaiting approval on second reading.
The government is required to publish a negative list every two years to guide foreign investors on which industries have been opened up to them.
Executive Order No. 65, signed on Oct. 29, 2018, outlines the restrictions contained in the 11th FINL. The current edition of the FINL allowed 100% foreign participation in internet businesses; teaching at higher education levels, provided the subject being taught is not a professional subject; training centers engaged in short-term high-level skills development that do not form part of the formal education system; insurance adjustment companies, lending firms, financing companies and investment houses; and wellness centers.
Last year NEDA was focused on updating the Philippine Development Plan 2017-2022 to take into account the impact of the economic downturn, NEDA Undersecretary Rosemarie G. Edillon has said.
Foreign investors are hoping the administration will liberalize more sectors in the upcoming list to raise business sentiment and improve the prospects for recovery.
“GPCCI is convinced that shortening the RFINL will greatly contribute to the Philippine economic recovery and increase the economy’s competitiveness,” according to German-Philippine Chamber of Commerce and Industry (GPCCI) President Stefan Schmitz, in an e-mail Friday.
GPCCI said it is also hoping for the passage of the bills amending the PSA, Retail Trade Liberalization law and FIA to open the economy to more foreign investment.
“Many German companies will expand their current investments or would consider a first-time investment if the investment regime in the Philippines is liberalized. Shortening the FINL would be an important step to attracting more foreign investment,” GPCCI Executive Director Martin Henkelmann said, also by e-mail. — Beatrice M. Laforga