BusinessMirror July 21, 2019

Page 1

ROTARY CLUB OF MANILA JOURNALISM AWARDS

2006 National Newspaper of the Year 2011 National Newspaper of the Year 2013 Business Newspaper of the Year 2017 Business Newspaper of the Year 2019 Business Newspaper of the Year

BusinessMirror

www.businessmirror.com.ph

A broader look at today’s business n

Sunday, July 21, 2019 Vol. 14 No. 284

2018 EJAP JOURNALISM AWARDS

BUSINESS NEWS SOURCE OF THE YEAR

DEPARTMENT OF SCIENCE AND TECHNOLOGY

2018 BANTOG MEDIA AWARDS PHILIPPINE STATISTICS AUTHORITY

DATA CHAMPION

P25.00 nationwide | 2 sections 20 pages | 7 DAYS A WEEK

LIBERALIZATION, MORE TAX REFORMS MARK DUTERTENOMICS ENDGAME

AERIAL view of Metro Manila

ROLAND NAGY | DREAMSTIME.COM

By Jovee Marie N. Dela Cruz, Bernadette Nicolas & Butch Fernandez

W

Reporters

ITH the opening of the 18th Congress and the anticipated fourth State of the Nation Address (Sona) on Monday, President Rodrigo Duterte is expected to push anew for the passage of his priority bills, which are seen to accelerate his administration’s march to meet its goals for the remaining three years.

Members of the 18th Congress started filing their “pet” bills beginning the first day of July. Some of these bills are the priority measures that Duterte mentioned in his previous Sonas, hence, the tag “Sona bills.” (See sidebar) To note, only five Sona bills were enacted into law under the 17th Congress. The remaining tax packages under the Tax Reform for Acceleration and Inclusion (TRAIN) law are also included in the so-called Sona bills. Albay Rep. Joey Salceda and Camarines Sur Rep. Luis Raymund Villafuerte are among the earlybirds who refiled the Sona bills. The

two lawmakers have both filed bills separately amending the outdated provisions of the Public Service (PS) Act, the Foreign Investments Act (FIA) and the Retail Trade Liberalization (RTL) Act.

‘Opening act’

ACCORDING to Villafuerte, these measures aim to further open wide the economy to more foreign investments. He added these bills would be among the measures the Executive branch would ask the 18th Congress to approve this year to fulfill the President’s goal of further revving up the economy, creating

PESO EXCHANGE RATES n US 51.0290

more jobs and significantly lowering poverty incidence by 2022. Villafuerte said these amendments would serve as the “opening act” for Congress’ move to amend the 1987 Constitution. Such, ultimately, is expected to pave the way to federalism and the liberalization of foreign ownership restrictions that Villafuerte said have barred the Philippines from securing higher levels of foreign direct investments enjoyed by its neighbors. Likewise, Presidential Spokes­ man Salvador S. Panelo told the BusinessMirror that aside from federalism, there are more things to look forward to in the next half of Duterte’s term, including the passage of these three priority measures. Still, Panelo added that with the President’s unwavering support for federalism, Malacañang emphasized that this form of governance, as well as changing the Charter, can still happen within Duterte’s term. Except for the amendatory bill on anti-terrorism to add teeth to the Human Security Act, the FIA and the PS Act are also high on Senate President Vicente Sotto III’s list. Sotto has vowed to ensure that the Senate, under his leadership, will “continue to strive and focus on our legislative work.”

Greater foreign ownership NO less than Speaker Gloria Macapagal-Arroyo had pushed for amending the 83-year-old PS law in the 17th Congress, with a salient provision for a clear definition of “utilities” in order to allow key sectors (i.e., telecommunications) to be freed from the “60-40” constitutional restrictions on foreign equity ownership. It was viewed by critics as a means to amend the Charter without going through the Charter-change process. Interestingly, the Senate counterpart of Arroyo that time who also pitched for amendments to the PS law is one of her arch-political enemies, Minority Leader Franklin M. Drilon. “To say that the law [covering public utility] is outdated is a gross understatement,” Drilon said. “Notwithstanding the antiquity of the [PS law], it is the law [that] defines which entities shall be considered a public service and, interchangeably, a public utility,” he explained. Drilon pointed out that “today, telecommunication and Internet services in the Philippines are among the slowest and most expensive in the region.” “There are a few options for safe, efficient and reliable public transportation [and] power supply remains a problem with citizens forced to accept outages as

a usual occurrence,” he added. “Water is available only at limited times during the day, with shortages now part of every Filipino’s ‘new normal.’” Drilon griped that “water, electricity, transportation, communication are supposedly basic needs, but their adequate and efficient supply cannot even be guaranteed to the Filipino.”

Defining public utility

DRILON believes these problems persist due to the absence of choices and competition. Salceda shares his view that lack of competition is partly attributable to the PS law. The latter’s definition of public service is being used to define public utility, the operation of which is limited to Filipino citizens or corporations controlled by Filipino citizens. “Competition and foreign investment are inhibited because limitations that should only apply to the operation of a public utility are usually also applied to all public services,” Salceda said. “This situation is caused by the ambiguity in the definition of public utility that is often used interchangeably with public service under Commonwealth Act 146 [the PS Act].” Senate Bill 13 provides a limited definition of the term public utility, while opening up other public services to the market, pro-

posing amendments to transfer the powers of the Public Services Commission to the appropriate administrative agencies. The bill at the Lower House, meanwhile, seeks, among others, to prescribe a 12-percent cap on rate of return. It also seeks to prohibit income tax as operating expense for rate-determination purposes for public services, including public utilities, consistent with administrative and judicial pronouncements.

Retail trade liberalization

SALCEDA said it is unfortunate that despite the passage of Republic Act (RA) 8762 almost two decades ago, the RTL law failed to boost the growth of the country’s retail trade sector. By comparison, the country lags behind its neighbors in the Association of Southeast Asian Nations (Asean) in terms of investment growth in this sector, he added. Needless to say, RA 8762 has failed to accomplish its objectives. Salceda has refiled the amendatory bill seeking to set the minimum paid-up capital and locally produced stock inventory requirements for foreign retail businesses. Villafuerte also refiled his version of the bill to amend the 19-year-old RTL Act. Continued on A2

n JAPAN 0.4756 n UK 64.0363 n HK 6.5289 n CHINA 7.4165 n SINGAPORE 37.6181 n AUSTRALIA 36.1030 n EU 57.5556 n SAUDI ARABIA 13.6070

Source: BSP (July 19, 2019 )


Turn static files into dynamic content formats.

Create a flipbook
Issuu converts static files into: digital portfolios, online yearbooks, online catalogs, digital photo albums and more. Sign up and create your flipbook.
BusinessMirror July 21, 2019 by BusinessMirror - Issuu