Philippines is Asean laggard in FDI

MANILA, Philippines — Vietnam has overtaken the Philippines in terms of foreign direct investments, with booming Hanoi getting double-digit FDI levels while Manila lagged behind its Association of Southeast Asian Nations (ASEAN) neighbors.

Data from the regional grouping showed that “erstwhile tailender” Vietnam, whose population stood at 96 million as of July 2017, got $12.6 billion in FDI in 2016, which was “a third higher than what we got,” according to Rep. LRay Villafuerte of Camarines Sur.

He said it may have been good that the Philippines – with its “successive ratings upgrades” from the world’s top three debt watchers Moody’s, Standard & Poor’s and Fitch Ratings – got a “40-percent increase” in FDI, but that $7.9 billion is still way below what the rest obtained.

“This is small when compared with the $53.9 billion in FDI that went to Singapore the same year or the $11.3 billion that went to Malaysia,” Villafuerte said.

Both the Philippines and Vietnam have at least 300,000 square kilometers in total land area.

Even in terms of ease-of-doing-business, like in registering a real estate property, Hanoi beat Manila since it only takes five steps in Vietnam – the same number it takes in Muslim-dominated Indonesia – as against the nine steps here in the Philippines. It takes four steps in fully developed Singapore as well as Laos and three in Thailand.

Parañaque Rep. Gus Tambunting nevertheless expressed belief that the new ease-of-doing-business law that President Duterte has signed will be beneficial to both local and foreign enterpreneurs, for the business industry in particular and the country in general.

“It is about time that we catch up with our ASEAN neighbors,” Tambunting said.

“I am elated that this very important piece of legislation has been signed by President Duterte,” he added.

Comparing the country’s business procedures with those of its Asian counterparts, Tambunting pointed out that in starting a business, the Philippine has 16 steps compared to six for Laos and Thailand, and three in Malaysia and Singapore.

The administration lawmaker, who heads the House of Representatives’ games and amusement committee and who sits as vice chairman of the ways and means committee, quoted a recent World Bank report.

“On paying taxes, the Philippines has 36 payments, (a figure) close to that of Myanmar’s 31 and Brunei’s 27; and, almost three times that of Malaysia, which is 13, and more than seven times than that of Singapore, five payments,” Tambunting noted.

“(The law’s) objectives are to minimize regulations in securing licenses, clearances and permits on business entities; create an environment conducive for business to register, comply and operate; and encourage foreign investment,” he said.