By easing the restrictions and requirements for foreign businesses in the Philippines, a senator on Sunday said the passage of the bill amending the Foreign Investments Act (FIA) of 1991 will help generate jobs for Filipinos.
Sen. Sherwin T. Gatchalian said the recent ratification of the bill is “very timely” as the country is now opening up the economy.
The senator also said these amendments will lead to a foreign investment regime that is more attuned to the changing economic climate and its accompanying demands.
“Our receptiveness to these changes may very well determine whether we can live up to our true economic potential or remain in the doldrums compared to our next-door neighbors,” he said in a statement.
“With these amendments in the Foreign Investments Act of 1991, investors can look forward to a more supportive government policy and a more attractive investment destination,” added Gatchalian, one of the co-authors of the bill.
Under the amended FIA, foreign professionals will now be encouraged to come to the country to share their knowledge, expertise, skills and technical know-how and allow Filipinos to broaden and enhance their competitiveness in both domestic and international labor markets.
“This transfer of knowledge and technology will in turn help the country attract more businesses that require high-skilled workers,” said Gatchalian.
The ratified bill adopted Gatchalian’s proposal on the establishment of an online portal to serve as a central database, to include a directory of ready local partners from priority sectors as a tool for promoting investments and businesses matching in local supply chains.
Also introduced in the amended FIA is Gatchalian’s proposal allowing start-up and startup enablers endorsed by lead host agencies pursuant to RA 11337 to be funded by foreigners with a minimum capital of P100,000 to encourage investments that will pioneer in the country.
The bill amending the Foreign Investment Act of 1991 is now awaiting the President’s signature as the two chambers of Congress have already ratified their joint version of the bill.
The bill, which seeks to further open up the economy, is one of the priority liberalization measures of the Duterte administration.
Among the salient features of the bill is the creation of the Inter-Agency Investment Promotions Coordination Committee (IIPCC), which shall be the body that will integrate all promotion and facilitation efforts to encourage foreign investments in the country.
Under the bill, the Department of Trade and Industry (DTI) will act as the IIPCC lead agency.
The measure also mandates the IIPCC to establish both a medium- and long-term foreign investment promotion and marketing plan.
As part of the drive to liberalize and attract more investors, the bill reduces the number of direct hires that foreign firms are required to have, from 50 to just 15 workers. A minimum paid-in capital of $100,000 shall be allowed to non-Philippine nationals.
The alien firms are also allowed by the measure to set up, and have 100-percent ownership, of small and medium enterprises as long as their products and services do not fall within Lists A and B of the Foreign Investment Negative List provided under this proposal.