EU concerned about unstable political, security situation in RP

Spanish Ambassador Tomas Rodriguez-Pantoja said yesterday the European Union views the Philippines’ unstable political and peace and order situation as one of the reasons why European businessmen are hesitant to invest in the country.

"We ask the Philippine government to create favorable conditions for (investment)," the envoy said during a press conference on Spain’s assumption into the EU presidency.

Rodriguez-Pantoja also urged the Arroyo administration to be more "transparent" and create a system of attracting more businesses to the Philippines.

He said European investors have found the government’s current policies on foreign investment unsavory, thus the need for clearer guidelines.

Should the Philippines fail to make itself attractive to foreign investment, it stands to lose foreign capital to other countries, he said.

Rodriguez-Pantoja noted that many Spanish companies have closed shop in the past four years because they could not generate any profit in the Philippines.

"We are ready to try to stimulate EU investment in the country, but then again, we ask your government to make an effort to create favorable conditions," he told reporters.

The Spanish envoy said EU authorities are particularly concerned about the security issue. "We have talked in the past month with your authorities to at least normalize a little bit the life here as far as security is concerned," he said.

Over the past 10 years, the EU has been the largest source of foreign direct investment (FDI) in the Philippines, overtaking Japan and the United States.

EU’s direct investments in the country accounted for nearly one-fourth of total FDI from 1990 to 2000. EU investments, however, fell by 87 percent from January to September last year.

The EU also remains to be the third biggest donor to the Philippines, after the US and Japan.

The EU presidency rotates every six months among the member-states — from January to June, and then from July to December.