Sen. Richard Gordon said the Philippines has to capture foreign direct investments (FDIs) as the global supply chain diversifies due to the pandemic.
Gordon told the general membership meeting of the Philippine Chamber of Commerce and Industry last week the country has to catch up with its neighbors in Asean in attracting FDIs as it has become a laggard due to its low rankings in competitiveness and in ease of doing business.
“And the enemy is of course, our slowness in our bureaucracy.
We’re supposed to have easy access to business but we’re the slowest…It denies us the opportunity to be able to attract more (FDIs), we have the least attractive indicators – competitive tax regime, government confidence, policies stability, predictability, in the 2021
World Competitiveness. In the 2020 Ease of Doing Business, the Philippines ranked 95th while Singapore is second, Malaysia, 12th; Thailand, 21st and; Vietnam, 70th,” Gordon said.
Gordon also lamented that FDIs by expanding and diversifying companies go to Vietnam and Indonesia.
In 2018, he said, the Philippines attracted $9.9 billion FDIs against Indonesia’s $18.9 billion and Vietnam, $15.5 billion
In 2019, the Philippines got $ 8.6 billion; Indonesia, $24.9 billion and Vietnam, $61.1 billion.
In 2020, Gordon said FDIs to the Philippines stood at $ 6.5 billion while Indonesia held on at $19.1 billion and Vietnam registered a double-digit growth in FDIs despite the pandemic.
Philippine FDIs stood at $ 3.4 billion from January to May this year.
Gordon said even before the pandemic, net FDIs to the Philippines were going down at $10.2 billion in 2017, $ 9.9 billion in 2018; $ 8.6 billion in 2019 and; $6.5 billion last year.
“Just like the pandemic we were startled, we were behind. In the end, like the pandemic we were not able to buy our vaccines, we did not have the testing infrastructure and we are trying to catch up,” Gordon said.
He noted that in the overseas supply chain diversification of Japanese companies as revealed by Japan External Trade Organization’s (JETRO) survey, the Philippines got 9 firms compared to Thailand which got 22; Vietnam, 39 and; Indonesia, 12.
Gordon also said the JETRO survey revealed that in the first round of selection, 30 Japanese firms qualified for subsidies to diversify their supply chains from China to Asean countries, 15 firms will go to Vietnam while only three will go to the Philippines. – Irma Isip
