PH: OVERCOMING DECADES OF MISSED FDI OPPORTUNITIES

Dutertetookadecisivesteptowardthatdirection.Whyhasthechangetakensolong?Andwhyisthedevilinthedetails?

IN the third quarter, the Philippine economy grew 6.9 percent, which made it Asia’s second fastest-growing economy after Vietnam. But unlike Vietnam, of foreign direct investment (FDI), the Philippines has not.

Again and again, former President Benigno Aquino 3rd acknowledged the need to boost FDI during his reign. Yet, the main challenge to attract FDI has been the 60/40 foreign ownership law, which Aquino neglected to confront between 2010 and 2016.

On November 21, President Duterte ordered the National Economic Development Authority to lift or ease restrictions on foreign direct investment (FDI) in the Philippines to foster economic growth.

With this directive, the foreign investment negative list is expected to be cut by half. The goal is to “raise the Philippines’ competitiveness, and to foster higher economic growth in the Association of Southeast Asian Nations (Asean) region

As I have argued for years—on the basis of my work in competitiveness, innovation and FDI in several continents—a change is desperately needed in the Philippines. And it is about three decades late.

Falling behind

While FDI stock illustrates the size of foreign investment historically, recent investments. In the years of booming globalization, FDI stock as percentage of GDP increased slowly in the Philippines, but more than doubled in Indonesia and almost quadrupled in Thailand—until global FDI plunged during the

in 2013-2014, but only to plunge to $4.9 billion in 2015 toward the end of the Aquino era. These Aquino promised to attract far more