The constitutional commission must look into the protectionist economic provisions of the 1987 Constitution that have been blamed for the relatively “anemic” foreign direct investment inflows despite the Philippines’ credit rating upgrades and new status as among Asia’s fastest-growing economies, a House leader said on Thursday.
“It is the constitutional provisions: One, putting a 40-percent cap on foreign ownership and second, barring foreign participation in certain sectors such as the media that have been a deal breaker for prospective foreign investors,” Camarines Sur Rep. LRay Villafuerte, one of the lead proponents of Charter change in the Congress, said.
Villafuerte made the statement following reports that the Con-Com plans to also consider recommending amendments to the Constitution in a bid to liberalize the economy.
Arthur Aguilar, chairperson of the Con-Com’s economic reforms and fiscal administration sub-committee, the body would gather inputs from business chambers and advocacy groups in crafting the recommendations.
The Joint Foreign Chambers of the Philippines, the Makati Business Club (MBC), the Financial Executives Institute of the Philippines (Finex) and the Management Association of the Philippines (MAP) have already submitted their position papers to the Con-Com.
Villafuerte, vice chairman of the House Committee on Appropriations, said “relaxing or lifting such restrictive provisions should be studied by the Con-Com and Con-Ass along with the proposed switch to the federal system.”
“Our protectionist economic policy is an anachronism under the new global free economy or borderless world. This is why FDIs have remained relatively anemic despite the Philippines’ newfound investment-grade status as Asia’s bright star,” Villafuerte said.
“True, there has been a 40 percent jump in FDI inflows to $7.9 billion to the Philippines in 2016, based on ASEAN (Association of Southeast Asian Nations) data,” he said.
“But this is peanuts when compared to the $53.9 billion that went to Singapore the same year. Malaysia had $11.3 billion in FDIs.”
“Even erstwhile tail-ender Vietnam got $12.6 billion in FDIs, which is a third higher than what we got despite the Philippines’ successive credit ratings upgrades from the top three debt watchers Moody’s, Standard & Poor’s and Fitch Ratings,” he added.
Meanwhile, San Beda Graduate School of Law dean Fr. Ranhilio Aquino, who is a member of the consultative committee, has backed the creation of a body that will lookl into the constitutionality of any proposed legislation before it is passed into law.
Aquino said the proposed 25-man Constitutional Council will try to avoid situations where the Supreme Court ends up striking down measures to be passed by Congress.
“One answer to that is to place within the legislature itself a body that previews—does not review, but previews—legislation prior to enactment,” he told a television interview.
Aquino’s proposal will have a Constitutional Council to be composed of former presidents, chief justices, Senate presidents, and House speakers.
The Federal Congress in turn, will vote on the rest of the members based on nominations by the incumbent president.
Aquino also proposed that no sitting member of parliament will be allowed to join the council, which will be “integral” to the Federal Congress.
The Constitutional Council will convene when the constitutionality of a bill is questioned by the president, House speaker, or the president of the House of Councilors.
It can also look into the constitutionality of pending legislation if voted by at least 100 members of the House of Representatives or at least 30 of their counterparts from the House of Councilors.
Aquino also suggested a Council of States, a replacement of the present Senate, to handle “that part of the legislative agenda dealing with states or regions.”
The consultative committee, however, has yet to determine how many states or regions will be created under a Federal Philippines, and from which a specific number of senators would be elected based on some proposals.
“The moment the Constitutional Council has ruled on it and declared (a bill) unconstitutional, its constitutionality can no longer be assailed,” Aquino said.
Aquino said that last Wednesday, former Chief Justice Reynato Puno, who chairs the committee, asked how the proposal would affect citizens aggrieved by a provision of law.
“As long as the Constitutional Council has not ruled on (a bill) yet, any citizen can attack its provisions on the basis of personal injury to him,” Aquino said.
