Retirement haven: Take it with skeptical optimism

Recently, Japanese investors proposed to build a P32 billion facility on a 1.25-hectare lot at the South Road Properties (SRP).  Expected to earn P32 billion in its 25-year lease, this project elicited a collective support from the executive and legislative departments (which is a rarity nowadays) of the City of Cebu.  Thus, with the seemingly upbeat interest in such proposed project, revisiting the country's foreign retirees' program is imperative.

Indeed, it's been over two decades that the nation's visionaries are consistently harping on the possibility of establishing huge retirement villages for other countries' aging population. Today, however, the frustration is just as high as that lofty dream and as deep as a retiree's final resting place. Never fault our line agencies, however, because whether their efforts are inadequate and so limited, it is a fact that they've done their best in promoting it.  We must realize though, that success in every undertaking does not rest solely on best-effort basis.  More often, when we give our best on the more appropriate courses of actions, better results are achieved. 

As usual, just like any business endeavor, for this to succeed, we must understand what the customers' (prospective retirees) needs are.  Therefore, first and foremost, we should know their (retirees) preferences.  Definitely, our potential customers are those who are willing to be away from their families and friends and have the money to give away for paid comforts and caresses.  Therefore, rich countries with superior retirement benefits are great potential. 

Though they can be easily identified, let us not forget that the real issue is—they can recognize us.  For easy recognition, this country should be on top of the list of their preferred destinations.  How? That's the challenge.  One thing though, these retirees decide based on their priorities.  Priorities include, among others, proximity to their homes, cost of living, weather, availability of telecommunications, infrastructure, safety (peace and order), best health care, investment priorities and tax incentives (should retirees find a way to invest their retirement pay).  Their main consideration really is whether what we are to offer are far greater than those offered in their home countries.  With these criteria in place, we can see our country at 15th place in the International Living's 2013 survey (on preferred destinations) with Ecuador still leading the way.  Dominated by countries in Latin America and Europe, it is, by far, noteworthy. However, knowing that Malaysia (3rd) and Thailand (9th) are way ahead of us will not make us comfortable.  Since, like any business, competition is totally unavoidable, studying our Southeast Asian neighbors' ways is, therefore, mandatory. 

What Malaysia did is not earth-shaking after all.  They simply studied it long and hard.  They started it nine years ago when they launched "Malaysia-My Second Home" (MM2H) by offering foreigners, particularly retirees, to live permanently in their country. They started by giving five-year visa with unlimited entry/exit privileges and without minimum annual residence requirement. Permanent residency is also a possibility after a five-year stay.  Retirees may also bring in household effects duty-free, and import or purchase one vehicle locally, tax free.  Income tax incentives are also offered for investing retirees. Notably, recipients (foreigners) are eligible to buy houses at a cost of not less than RM150,000.00(or roughly US$41,677.50 at the current exchange rate) each. More importantly, for purposes of owning the house, they are also entitled to borrow from local banks 60% or more of its cost or value.  On the other hand, what do we (Philippines) offer to these foreigners (retirees)? The Philippine Retirement Authority's (which promotes and grants Special Resident Retiree Visa) website simply bragged about, among others, "our world-renowned Filipino hospitality, our diverse culture, and reasonable standard of living." Moreover, the country's time deposit requirement in obtaining the visa ranges from US$10,000.00 to US$50,000.00 depending on whether one is a pensioner or not and his/her age.  While it seems that our time deposit requirement is not stiff, its subsequent conversion is irrational.  These required time deposits can only be converted into active investment through purchase, acquisition and ownership of a condominium unit; long-term lease of house and lot, condominium or townhouse for a period not shorter than twenty (20) years; and purchase, acquisition and ownership of golf or country club shares.

In comparing our country's and Malaysia's programs, any ordinary citizen can simply tell why ours is bound to fail.  It is just too inferior.  We shouldn't brag about our serene beaches and hospitality because Malaysia and other countries have that as well.  The disparities are very evident and are all in Malaysia's favor.

However, Malaysia being on top should not be a source of envy for us but an inspiration.  Since geographically we are similarly situated, the possibility of taking a sizeable slice of that huge pie of moneyed retirees is a possibility.  Taking it from Malaysia's experience, we can still be a preferred destination.  All we need to have is the right direction supported with more appropriate legislations.   Devoid of these initiatives, we should take Cebu's retirement haven prospects with skeptical optimism.

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