State think tank Philippine Institute for Development Studies (PIDS) said amending the economic provisions of the Constitution will help boost the country’s services sector.
In its study titled “Insights into Economic Charter Change and the Case for Services Reform,” PIDS senior research fellow Ramonette Serafica noted the need for adaptable policies and government structures, which include designing regulations that keep pace with the evolving global economy and changing consumer preferences.
“By adopting adaptable policies and institutions, governments and stakeholders can capitalize on emerging trends, foster innovation, and enhance competitiveness,” she said.
One key area for reform identified by the study is the current legislative franchise requirement, which is rooted in colonial-era laws and is not common in other countries’ constitutions, PIDS said.
Such requirement increases business costs, creates unfair advantages and duplicates regulatory functions, PIDS added.
“The same may not be necessary, as an independent regulatory authority could make licensing decisions. Eliminating the legislative franchise requirement would streamline the process, reduce barriers, and improve the overall business climate,” Serafica said.
The study also calls for revising the complete nationalization of mass media as stipulated in the 1987 Constitution.
The PIDS study said there is no justification for the restriction, arguing that it hinders growth and innovation in the media sector.
“The Constitution emphasizes a balanced flow of information, and respects freedom of speech and the press, but it does not provide a clear rationale for full nationalization of the mass media sector,” Serafica said.
Serafica pointed out the definition of mass media has evolved with the advent of digital technologies, leading to media convergence and landscape transformation.
“The restrictions on mass media ownership were initially introduced in the 1973 Philippine Constitution, before the widespread availability of the internet and digital platforms,” she said.
Serafica said there should be policies that balance the interests of stakeholders, protect freedom of expression and promote a diverse media environment.
The PIDS study also noted the need to adopt a pro-innovation approach to liberalization, saying it is necessary to enhance the regulatory framework, integrate liberalization into a comprehensive structural reform agenda, and prioritize productivity to improve citizens’ quality of life.
Serafica said liberalization must be pursued within a broader structural reform agenda to maximize benefits.
“This means improving regulations and strengthening institutions that foster an economic environment conducive to robust competition, innovation, and efficient resource allocation,” she said.
“While concerns exist that increased foreign participation in the service sector, following liberalization, could lead to a decline in service quality, it was posited that regulatory bodies will continue to enforce quality and ethical standards for all firms, regardless of nationality.
Competition itself can also act as a powerful driver of service improvement,” Serafica added.
“There are a lot of problems confronting the country that it is tempting to dismiss economic charter change in favor of seemingly more pressing issues. However, economic charter change offers a strategic opportunity not to be missed,” Serafica also said.
