AUSSIES ADVISED AGAINST RELIANCE ON CHINESE INVESTORS, ODA
“If you have a proper rail linking Batangas to Subic, it will change transport system in this country,”
The Philippine government should implement competitive investment policies and not rely heavily on China for investments and overseas development assistance (ODA) so as not to drive away other foreign investors, a Manila-based Australian business leader said yesterday.
At the International Conference on the Implications of the ASEAN Charter for East Asian Integration at the Sofitel Hotel in Manila, Dr. Michael Clancy, chairman and chief executive officer (CEO) of the Philippine Business Leaders Forum, said China investments and ODA “are less important in terms of pouring investments in the country.”
“There should be less reliance on Chinese loans and greater integration into the global supply chain through competitive investment policies that bring best practice,” Clancy said.
He criticized the Philippines for favoring Chinese investors over others, giving a negative image of the business climate in the country.
He said a European investment delegation visited the Philippines two years ago, but the group “was almost driven away by government officials who told the delegation that China plays a very important role in investments in the country.”
“We were involved in a European investment delegation to the Philippines, and they came here to specifically look into Philippine investment prospects and had a meeting with Philippine government officials. But they were told point-blank by government officials: ‘We don’t need your money anymore. We have China now. We can get all the money we need from China,’” he said.
When asked about foreign investors’ views on the overpriced national broadband network (NBN) deal between the government and Chinese firm ZTE, Clancy said the deal has greatly affected the country’s international image.
“It’s just one more and each one of them drives another nail into the coffin. What it does is that people are thinking about the Philippines and they would say ‘Forget it.’ It’s sending the wrong international image to the world again,” he said.
The business leader cited corruption and the problem of governance as factors that turn off foreign investors and continue to hinder the country’s economic development.
He noted that most investors have complained that almost 50 percent of their operation cost here goes to “bribes.”
“I think with or without ZTE, nothing would change much. It’s just a problem on governance. It has been a problem of this country for a number of years,” he added.
He noted that corruption is 99 percent of the foreign investors’ problem in the Philippines and security is only one percent.
The problem of corruption, he said, also has forced several foreign companies to shut down their operations in the country and transfer to other countries in Asia.
“In terms of putting new investments, they are looking at somewhere else in Asia. Western companies looking at Asia are not going to tie themselves totally to China. They will have a backup and at the moment that backup is not the Philippines,” he said, adding that foreign investors are considering investing in Malaysia, Thailand, and Australia rather than in the Philippines.
He also cited the government’s excessive openness to concessional loans from China which are used to fund sub-standard projects.
The China-funded Northrail project, he said, should have been designed not only as a “narrow gate” commuter line, but a “standard or heavy duty line” for cargo to bring goods to and from different parts of the country.
“If you have a proper rail linking Batangas to Subic, it will change transport system in this country,” he said.
A new diagnostic study of the Asian Development Bank (ADB) released last week said the Philippines must overcome critical constraints to increase growth and reduce poverty in the next five to eight years.
The report “Philippines: Critical Development Constraints” identified measures the government needs to push for real economic growth.
These include raising revenues, improving infrastructure, strengthening governance to build investors’ confidence, expanding industrial base, improving access to employment, and developing opportunities for all.
The report showed that the economy has fallen behind its neighbors in East and Southeast Asia the last five decades.
Poor performance on key governance aspects, control of corruption and political stability has eroded investors’ confidence in the Philippines.
The report cited studies suggesting that the Philippines’ ranking in the control of corruption and maintaining political stability has worsened.
It explained that governance concerns underline other critical constraints. For instance, corruption undermines tax collection and reduces resources and quality of infrastructure development. By Pia Lee-Brago - STAR
The Philippine government should implement competitive investment policies and not rely heavily on China for investments and overseas development assistance (ODA) so as not to drive away other foreign investors, a Manila-based Australian business leader said yesterday.
At the International Conference on the Implications of the ASEAN Charter for East Asian Integration at the Sofitel Hotel in Manila, Dr. Michael Clancy, chairman and chief executive officer (CEO) of the Philippine Business Leaders Forum, said China investments and ODA “are less important in terms of pouring investments in the country.”
“There should be less reliance on Chinese loans and greater integration into the global supply chain through competitive investment policies that bring best practice,” Clancy said.
He criticized the Philippines for favoring Chinese investors over others, giving a negative image of the business climate in the country.
He said a European investment delegation visited the Philippines two years ago, but the group “was almost driven away by government officials who told the delegation that China plays a very important role in investments in the country.”
“We were involved in a European investment delegation to the Philippines, and they came here to specifically look into Philippine investment prospects and had a meeting with Philippine government officials. But they were told point-blank by government officials: ‘We don’t need your money anymore. We have China now. We can get all the money we need from China,’” he said.
When asked about foreign investors’ views on the overpriced national broadband network (NBN) deal between the government and Chinese firm ZTE, Clancy said the deal has greatly affected the country’s international image.
“It’s just one more and each one of them drives another nail into the coffin. What it does is that people are thinking about the Philippines and they would say ‘Forget it.’ It’s sending the wrong international image to the world again,” he said.
The business leader cited corruption and the problem of governance as factors that turn off foreign investors and continue to hinder the country’s economic development.
He noted that most investors have complained that almost 50 percent of their operation cost here goes to “bribes.”
“I think with or without ZTE, nothing would change much. It’s just a problem on governance. It has been a problem of this country for a number of years,” he added.
He noted that corruption is 99 percent of the foreign investors’ problem in the Philippines and security is only one percent.
The problem of corruption, he said, also has forced several foreign companies to shut down their operations in the country and transfer to other countries in Asia.
“In terms of putting new investments, they are looking at somewhere else in Asia. Western companies looking at Asia are not going to tie themselves totally to China. They will have a backup and at the moment that backup is not the Philippines,” he said, adding that foreign investors are considering investing in Malaysia, Thailand, and Australia rather than in the Philippines.
He also cited the government’s excessive openness to concessional loans from China which are used to fund sub-standard projects.
The China-funded Northrail project, he said, should have been designed not only as a “narrow gate” commuter line, but a “standard or heavy duty line” for cargo to bring goods to and from different parts of the country.
“If you have a proper rail linking Batangas to Subic, it will change transport system in this country,” he said.
A new diagnostic study of the Asian Development Bank (ADB) released last week said the Philippines must overcome critical constraints to increase growth and reduce poverty in the next five to eight years.
The report “Philippines: Critical Development Constraints” identified measures the government needs to push for real economic growth.
These include raising revenues, improving infrastructure, strengthening governance to build investors’ confidence, expanding industrial base, improving access to employment, and developing opportunities for all.
The report showed that the economy has fallen behind its neighbors in East and Southeast Asia the last five decades.
Poor performance on key governance aspects, control of corruption and political stability has eroded investors’ confidence in the Philippines.
The report cited studies suggesting that the Philippines’ ranking in the control of corruption and maintaining political stability has worsened.
It explained that governance concerns underline other critical constraints. For instance, corruption undermines tax collection and reduces resources and quality of infrastructure development. By Pia Lee-Brago - STAR
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