MANILA, Philippines — The country’s group of retailers continued to oppose a proposal seeking to lower the required minimum investment for foreign retailers as this may imperil the viability of local micro, small and medium enterprises (MSME).
In a text message, Philippine Retailers Association (PRA) vice chairman Roberto Claudio said there is no need to bring down the minimum paid-up capital for foreign firms entering the country’s retail sector as it is already open to anyone that can meet the $2.5 million requirement.
“Lowering this to just $200,000 will threaten and most probably kill our MSMEs,” he said.
He said the retail sector serves as the entry point for many budding Filipino entrepreneurs and subjecting them to foreign competition at an early stage would undermine MSMEs and entrepreneurship in the country.
“This is a fight for our MSME retailers in the country who have no voice nor resources to air their concerns. The PRA is the voice of all retailers, we are fighting for the small Filipino retailers who will be affected by the very low minimum investment requirement,’’ he said.
Economic managers have been pushing for the passage of amendments to the Retail Trade Liberalization (RTL) Act to encourage the entry of more investments into the country.
At present, the RTL provides that the minimum paid-up capital requirement for foreigners is at $2.5 million and anything below that is reserved for Filipino citizens or corporations wholly owned by Filipinos.
The House of Representatives’ version, which seeks to amend the RTL by reducing the minimum paid-up capital to $200,000, has been approved on third and final reading.
Meanwhile, a bill pending at the Senate, aims to set the minimum paid-up capital at $300,000.
The PRA said lowering the required minimum paid-up capital would just legitimize existing foreigners in the country to operate sari-sari stores, groceries, restaurants and public market stalls.
In encouraging investments, Claudio said the government should target big retail firms as these are the players that would help upgrade the country’s retail experience and technology.