Sans corruption, FDI likely 5 times bigger – ECCP

MANILA, Philippines – Foreign direct investments (FDIs) in the Philippines have the potential to grow five times its present size should corruption and red tape be eliminated, a private sector-led group pushing for integrity standards said.

In a forum Integrity Initiative Inc.  vice chairman and European Chamber of Commerce of the Philippines immediate past president Michael Raeuber said the country is missing out on a substantial amount of FDIs due to the still rampant corruption in both the public and private sectors.

 “In a completely corruption-free environment, probably our FDIs should be five times bigger as it is today. Corruption is very closely related to red tape and red tape is closely interrelated to corruption. If you have a combination of reducing red tape and at the same time further reducing corrupt practices, it (FDIs) could easily be five times more,” Raeuber said.

The Bangko Sentral ng Pilipinas reported earlier this month that FDIs declined 35 percent in the first seven months period of 2015 from a year ago.

Raeuber aired his concern regarding the downtrend, especially after last year’s FDIs reached record levels.

“The trend is not very encouraging. It is actually down while others were up. Something needs to be done to reverse that trend again and to bring the needed foreign investments which also will lead to inclusive growth,” he said.

“If we have less red tape, business is easier in the Philippines. Philippines has been increasing in some areas (in terms of global competitiveness reports), but decreasing in some, one of which is ease of doing business. This is something we have to urgently reverse,” Raeuber added.

Integrity Initiative is currently urging more companies and government agencies to take part of its campaign towards the establishment of acceptable integrity standards across various sectors.

Since its establishment in 2009, Integrity Initiative and Makati Business Club chairman Ramon del Rosario Jr. said the group has now a total of 3,000 corporate signatories.

“It’s a long ongoing effort. We covered a lot of ground and we made a lot of progress. We have gained a lot of support from the business community and from government and other sectors including the church and academe but we’re still trying to keep moving forward. We’re looking forward to the next five to six years of really continuing this effort so that it becomes instilled in our culture,” Del Rosario said.

“The potentials for our country have only been barely tapped. Building on integrity and good governance, accountability and transparency are some of the hallmarks of a country that will get far more interest and far more investments in the future,” he added.