Senator Franklin Drilon on Saturday expressed serious concerns over the government’s capacity to attract new investments for the country as the foreign direct investments (FDI) significantly dropped over the past year.
Citing data from the Bangko Sentral ng Pilipinas (BSP), Drilon said foreign equity placements other than reinvestments of earnings decreased by 90.3 percent during the first six months of 2017: from US$1.448 billion in the same period in 2016, it plunged to just US$141 million in 2017.
“We note from the reports that there is a deceleration in new investment. This is very alarming. Why such a huge drop? Is this an indication of anything?” Drilon asked.
The minority leader said that the National Economic and Development Authority (Neda) had a lot to explain about this huge drop in new foreign investments, saying this is “reflective of confidence of foreign business on our country.”
“If we are to attract new foreign investment, then it is about time that we take a serious look at how things are going on in our country, because new investment would not come in unless we are able to raise the investors’ confidence level in our country,” Drilon said.
Senator Loren Legarda said Neda had cited restrictions on investments as one of the reasons for the decline.
“I am told that it is because of certain restrictions. I do not agree with that answer because these restrictions were already there when there was an increase,” Legarda said.
Drilon said the government should seriously look into the huge plunge in FDIs because it is critical to the country’s economic growth and contributes in providing job and business opportunities to Filipinos.
He pointed out that the Philippines was not among the top Asean countries eyed by companies as possible expansion location.
According to the 2018 Asean Business Outlook Survey published by the American Chamber of Commerce in Singapore and the US Chamber of Commerce, the Philippines ranked sixth among 10 Asean countries, with only 22 percent of companies choosing the country as possible expansion location.
Vietnam topped the list with 34 percent, followed by Myanmar, 29 percent; Indonesia, 29 percent; Thailand, 26 percent; and Cambodia, 23 percent. /jpv
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