BusinessMirror September 26, 2019

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HANOI ‘BEST’ FOR U.S. INVESTORS By Elijah Felice E. Rosales @alyasjah

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MERICAN investors are more inclined to set up shop in Vietnam than in the Philippines, as they find Hanoi the best investment destination in Southeast Asia due in large part to its fiscal incentives menu and regulatory policy on businesses, a former United States ambassador has said. Michael W. Michalak, senior vice president and regional managing director of the US-Asean Business Council, said Vietnam is the most preferred investment site among Southeast Asian economies for Ameri-

can investors. The preference may be attributed to the country’s competitive incentives package, as well as to its management of investments, explained Michalak, who was former US ambassador to Vietnam. Michalak said it also works to Vietnam’s advantage that it is enhancing its menu of incentives to net some of the investments flying out of China in the face of its trade conflict with the US. “Vietnam has probably the most attractive [incentives package]. They do have fiscal incentives, but again it is really more on how they interact with the private sector, the way in which you can form a symbiotic relationship

between the government and the private sector so that,” Michalak said in an interview with the BusinessMirror. Last year investments in Vietnam’s industrial parks and economic zones reached over $8.3 billion, roughly P433.72 billion, according to the Ministry of Planning and Investment. Of this figure, $5.3 billion was injected for 560 fresh projects, while the remaining $3 billion was used for expansions in close to 500 existing operations. As of last year, Vietnam’s industrial parks and economic zones are home to $145 billion of investments for approximately 8,000 projects. See “Hanoi,” A2

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Thursday, September 26, 2019 Vol. 14 No. 351

‘Slower govt spending to impact PHL growth’ 6% G By Cai U. Ordinario

lower than its 6.4 percent estimate in April for both years. The ADB also slashed its inflation forecast for the Philippines this year to 2.6percent, from 3.8 percent in April. For 2020, the bank said inflation could average 3 percent,

BIR shuts down 3 Pogo sites for VAT violation By Nonilon Reyes

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@noniefoto

HE Bureau of Internal Revenue (BIR) shut down on Wednesday a Philippine offshore gaming operator (Pogo), billed the second biggest in the country, for its failure to pay the appropriate taxes. The BIR, which led an interagency raid on Great Empire Gaming and Amusement Corp. (Gegac) for its failure to register for value-added tax (VAT), padlocked its offices that occupied 11 floors of a building in Libis, Quezon City. The Department of Finance said the company, with over 8,100 employees, also has offices at the Subic Freeport and Aseana City, Parañaque. No employees were arrested, as the tax agency said it had jurisdiction only over the corporation and its compliance with tax laws. “Results of the investigation showed that Gegac is not registered for VAT purposes, violating the Section 108 vis-à-vis with Section 115 of the Tax Code as certified by the Revenue District Office 019-Subic Bay Freeport Zone,” BIR said. The closure order was issued by Deputy Commissioner for Operations Group Arnel SD. Guballa. BIR said the actions of task force Pogo, which padlocked the offices of Gegac, were guided by the direc-

PESO exchange rates n

Workers’ issues: Missing in the DICT’s FIR summit Rene E. Ofreneo

@caiordinario

LOBAL headwinds and the slowdown in Manila’s public spending will dampen the growth prospects of the Philippines for this year and next year, the Asian Development Bank (ADB) said on Wednesday.

The Manila-based multilateral development bank said in its report, titled “Asian Development Outlook Update [ADOU]” that the Philippines’s GDP growth will average 6 percent this year and 6.2 percent next year. These figures are

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lower than the initial estimate of 3.5 percent. On Wednesday, the Bangko Sentral ng Pilipinas (BSP) cut anew its inflation forecast to 2.5 percent, lower than the 2.6-percent forecast the Central Bank announced in their prev ious

ADB forecast of Philippine GDP growth in 2019, lower than the previous estimate of 6.4 percent

monetary-policy meeting. “Public spending should regain traction for the rest of 2019, with the government committed to catching up with its spending plans, especially as new and larger infrastructure projects get under way,” said ADB Country Director for the Philippines Kelly Bird.

laborem exercens

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ecently, the Department of Information and Communications Technology (DICT), the Philippine Chamber of Telecommunications Operators (PCTO) and BusinessWorld held an Industry 4.0 Summit with the theme “Winning Together in the Fourth Industrial Revolution.” Among the issues tackled are the technologies driving Industry 4.0, industry-government partnership in maximizing benefits from the adoption of these technologies and legislative measures to strengthen Philippine readiness under the Fourth Industrial Revolution (FIR), now popularly dubbed as Industry 4.0. Continued on A7

See “Growth,” A2

BSP cuts inflation forecast further

8,100 Number of people employed by Great Empire Gaming and Amusement Corp., which the BIR padlocked

tive from Finance Secretary Carlos G. Dominguez III, who in the past six months had led an interagency campaign to get all Pogos in the country to comply with immigration, labor and tax laws. The company, the BIR said, violated Section 115(b), in relation to Section 236 of the National Internal Revenue Code of 1997, as amended (Tax Code).

Moratorium

Earlier, the Philippine Amusement and Gaming Corp. (Pagcor) disclosed that it has imposed a moratorium on the issuance of licenses to new Pogos. Pagcor Chairman and Chief Executive Officer Andrea Domingo said the moratorium, which will last until the end of the year, will likely negatively affect its gross gaming revenues (GGR). Domingo said, however, that imposing a moratorium on the issuance of new licenses will give Pagcor time See “Pogo sites,” A2

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are the economic provisions in the 30-year-old Charter. These are found in Article XII, XIV and XVI. The JFC said a number of restrictive provisions in the current Constitution date back to the 1935 Constitution or 1973 Constitution, saying these reflect the nationalistic spirit at the time and the protectionist policy to favor Philippine

HE Bangko Sentral ng Pilipinas (BSP) expects inflation to fall further than earlier expected this year, its chief bared on Wednesday. BSP Governor Benjamin Diokno said inflation is now expected to average at 2.5 percent, lower than the 2.6-percent forecast the Central Bank announced in their previous monetary-policy meeting. The BSP’s next meeting will be Thursday (September 26). For the first eight months of the year, inflation already averaged at 3 percent, with the latest inflation print hitting 1.7 percent. The BSP’s forecast means inflation is expected to average below 2 percent in the last four months of the year. The government’s inflation target is at 2 percent to 4 percent on average for this year. While growth looked bleak for the country when it hit 5.5 percent in the second quarter of the year, the BSP brought good news to the country’s economy in its last monetary-policy meting as it revised the inflation forecast downward. For 2020, the projection was also

See “Constitution,” A2

See “Inflation,” A2

This is the scene inside the building in Libis, Quezon City, where Great Empire Gaming and Amusement Corp. (Gegac) is located. The offshore gaming operator was shut down on Wednesday (September 25) by the Bureau of Internal Revenue for not paying appropriate taxes. NONIE REYES

‘Outdated Constitution impedes PHL’s progress’ By Jovee Marie N. dela Cruz

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@joveemarie

WO big business groups expressed their support for proposals that will ease the restrictive provisions in the 1987 Constitution, as this will allow the Philippines to benefit more from technological advancements and international treaties.

The Joint Foreign Chambers (JFC) and the Makati Business Club (MBC) submitted position papers to the House of Representatives. The House Committee on Constitutional Amendments, chaired by Cagayan de Oro Rep. Rufus Rodriguez, started deliberating Charterchange proposals on Wednesday. Of particular interest to foreign investors and local businessmen

US 52.1890 n japan 0.4875 n UK 65.1945 n HK 6.6568 n CHINA 7.3340 n singapore 37.9446 n australia 35.4833 n EU 57.5227 n SAUDI arabia 13.9145 Source: BSP (25 September 2019 )


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BusinessMirror September 26, 2019 by BusinessMirror - Issuu