SOUND economic policies backed by promising macroeconomic indicators became the highlight of the investment pitch of President Ferdinand “Bongbong” Marcos Jr. before a Business Forum at the New York Stock Exchange (NYSE) last Monday.
In his 10-minute keynote speech in the event, Marcos urged American businesses to help in “transforming” the pandemic-affected economy by investmenting in key local sectors.
“The Philippines offers high-quality labor, a large consumer market, and a wide range of fiscal and non-fiscal incentives. At the same time, we remain committed to maintaining sound macroeconomic fundamentals providing a clear development roadmap,” Marcos said.
Among the sectors which he said are open for American investments are information technology and information technology-business process outsourcing (IT-BPO); medical products and devices; electric vehicles and batteries; agribusiness; and telecommunications infrastructure and services.
He noted that the infusion of investments in these sectors is expected to create new jobs and improve the quality of life of many Filipinos.
He noted now is the best time to invest in the country following the recent passage of laws, which helped “liberalize” its policies for foreign investments.
Foremost in of these pieces of legislation is the Corporate Recovery Tax Incentives for Enterprises (CREATE) Act, which lowered corporate income tax rates and rationalized fiscal incentives.
Marcos said the government also reduced the minimum paid-up capital requirements for foreign retailers and foreign startups bringing in advanced new technology as well as allowed full foreign ownership of companies providing public services.
“For investors, doing business in the Philippines is an opportunity to reap the benefits of a vibrant economy,” Marcos said.
The President noted that the country’s economy has already “bounced back” from the effects of the pandemic since last year after the government implemented massive stimulus programs and eased pandemic restrictions.
Local unemployment is now down to 5.2 percent from a high of 17.6 percent during the onset of the pandemic in 2020, according to Marcos.
Meanwhile, manufacturing activity retained a growth threshold of 50 for the past seven consecutive months, while trade is back to double-digit growth.
And despite the effects of the ongoing pandemic and other international crisis, the economic gains are expected to be sustainable due to reliable sources of foreign exchange, Marcos said.
“Supported by steady inflows of overseas Filipino remittances, receipts from business process outsourcing, and foreign direct investment, our gross international reserves stood at US$99 billion as of end-August, equivalent to 8.3 months of import cover. This remains more than sufficient to cover the economy’s foreign exchange needs,” Marcos said.
The government is forecasting growth in gross domestic product (GDP) of 6.5 percent to 8 percent from 2023 to 2028, which will give the country an upper-middle-income status.
Marcos is banking on the country’s long-time diplomatic and trading ties with the US to secure the much-needed additional investments to achieve this target.
The US is the country’s third largest trading partner and second major source of foreign direct investment applications last year.
The Business Forum in the NYSE, the world’s largest stock exchange by market capitalization, is part of the government’s efforts to attract more investors in the country.
“The private sector business leaders also are here with us precisely to show and explain to our prospective investors where the Philippines is headed, what changes we have made so that investment will be more profitable and more attractive for foreign investors, especially coming from the United States,” Marcos said.
The Philippine delegation led by Marcos already met last Monday with executives of US-based firms including multinational airplane manufacturer Boeing as well as NuScale Power and WasteFuel to discuss possible investments.
NuScale designs and markets small modular nuclear reactors, while WasteFuel converts agricultural waste into low-carbon fuel.
“We appreciate their keen interest in exploring investment opportunities in the country’s aviation and energy sectors. We assure them that our administration is committed to providing the necessary mechanisms and incentives to make the Philippines an ideal investment destination,” Marcos said.
He said he hopes the talks will eventually lead to strengthening the country’s aviation and energy sector and help in the country’s economic development.
Image credits: Troi Santos