What Charter Change? Just change the PSA to draw investors

By Mortz C. Ortigoza

Sa Pilipinas meron ho tayong 2.8 million (January 2018 NEDA) na unemployed at 2.3 million na overseas foreign workers (OFWs) as of 2018 according to psa.gov.ph.

Ilagay natin na kalahati sa OFWs na ito ay napilitan lamang magtrabaho abroad because of glaring unemployment problems dito sa Pinas. So, kung may pagkakataon na may trabaho dito, ay dito na nila pipiliin na mamalagi.

Foreign Investors

Siyempre, malapit sa pamilya at peace of mind kay mister na nasa abroad.

Why? Anak ng baka, mababantayan niya si misis sa lurking adulterous relationship sa kay kumpare na mukhang matagal ng may pagtitinginang malagkit ang dalawa sa isat-isa.

Sanamagan, that’s the social cost of working abroad!

So how can the government mediate for these unemployed and OFWs to have jobs in the country?

Singapore, Malaysia, and Vietnam took most of the Foreign Direct Investment (FDI) in the ASEAN - 10 Region. Sa six South East Asian countries ang Pilipinas na laos ang mga lider ang pinaka-kulelat sa negosyo ayon sa data ng Globaledge.MSU.Edu na hinimay ko.

Basahin ang data (in billions of dollars) sa ilalim para mamulat sa hubad na katotohanan:

1. Singapore’s Total Exports (2019) U.S $390,331,757,374

2. Vietnam’s Total Exports (2019 $264,610,322,69

3. Malaysia’s Total Exports (2019) $238,088,652,110

4. Thailand’s Total Exports (2019) $233,674,439,906

5. Indonesia’s Total Exports (2019) $167,002,880,981

6. Philippines’ Total Exports (2019) $70,926,674,490

Our lethargic FDI figures happened because, one reason, our law dangles only 40% and even 30% for the foreign investors to control the capital of the corporation here while the Filipinos are given 60% and even 70% control of the business.

Sa media industry nga 100% Pinoy ownership, pero iyan ay nasa Constitution at hindi nakalagay sa Public Service Acts.

For decades this First Filipino Policy I called xenophobic or bias against foreigners deprive us with the presence of more FDIs where many of them even transferred, as a contract with the host country, their technological blue prints how they manufactured their products.

Have you seen air-conditioned buses plying the highways in the Philippines? Their brands are no longer Japanese’s Hino and Isuzu or South Korean’s Hyundai and Daewoo but those cheap but world classes Mainland China’s Yutong, Shenlong, and others.

Yes, the chink eyed Sinos not only snared more foreign investment but also chalked up how to make those products built by the Americans, Japanese, Germans, and others.

China is making now a commercial airline’s Comac C919 that would compete with American owned Boeing and selected European countries owned Airbus.

Thanks to transfer of technology if not cyber thievery the Chinese are famous, too he he he!

All-encompassing pala itong FDI’s hosting, kasi may employment na sa mga tao, magkaka industrialization pa sila.

Thanks to Representatives Gloria Arroyo, Arthur Yap, Joey Sarte-Salceda, Jose Christopher Belmonte, and Manuel Monsour Del Rosario (the last one a Taekwando champ but through God’s miracle turned into an economic solon) where last September 8, 2017 their combined four bills passed the third reading in the House of Representatives.

How about its counterpart in the Senate to complement it?

Here’s Senator Bam Aquino when I interviewed him about the amendment of the Public Service Acts in the Senate.

“Well, una meron po kaming bill na ina-amend iyong Public Service Act. Pinapaliitan na public service. I think iyong matitira lang po ay tubig at kuryente. Pero lahat ay iba gaya ng Telco, gaya po ng internet service dapat binubukas natin iyan sa mas maraming players.

Iyan ho ang isang paraan para gumanda ang serbisyo sa ating bayan para may kumpetisyon”.

Aquino said the amendment of the PSA is not the absolute silver bullet to solve our economic problems.

He cited that other problems that discourage investors to come to our shore are corruption, red tape, arduous requirements to get a franchise, and others.

“Kailangan ng telco sa Pilipinas, kailangan  mo pa dumaan sa  Kongreso e alam mo naman napakahirap na proseso iyan. Dadaan ka sa NTC. Naparaming permit magtayo ka ng power plant 300 signatures iyong kailangan, sino naman mahihikayat magtayo ng negosyo dito kung ganoon kahirap iyan?”.

The Senate version, a combination of five bills that are similar to the Lower House, talks about the amendment of the public utilities in the PSA.

These utilities are mentioned at Section 11 of Article 7 of the 1987 Constitution where the law says they could be amended, altered, or repealed by Congress.

So the anxiety about somebody questioning the amendment as unconstitutional to the Supreme Court has been answered by the provision at Section 11 that says in part: “Neither shall any such franchise or right be granted except under the condition that it shall be subject to amendment, alteration, or repeal by the Congress when the common good so requires”.

According to the United Nations Conference on Trade and Development (UNCTAD) among the 104 countries including the Philippines the five most-affected industries in competition are transportation, media, electricity, telecommunications and mining, oil and gas.

Three of these industries, transportation, electricity and telecommunications are considered “public utilities” in the Philippines.

The old Commonwealth Act No. 146 or known as Public Service Acts restricts the ownership of public utilities. It is the reason that discourages foreign investors to come to our country and instead go to Thailand, Singapore, China, and Vietnam where they can own up to 100% of the capital and the control of the board of directors.

Commonwealth Act No. 146 or famously known as Public Service Acts covers the following public utilities:

“…any common carrier, railroad, street railway, traction railway, sub-way motor vehicle, either for freight or passenger, or both with or without fixed route and whether may be its classification, freight or carrier service of any class, express service, steamboat or steamship line, pontines, ferries, and water craft, engaged in the transportation of passengers or freight or both, shipyard, marine railways, marine repair shop, [warehouse] wharf or dock, ice plant, ice-refrigeration plant, canal, irrigation system, gas, electric light, heat and power water supply and power, petroleum, sewerage system, wire or wireless communications system, wire or wireless broadcasting stations and other similar public services”.

This lengthy coverage of the public utilities in Acts No. 146 have been chopped and replaced by House Bills 5828 limiting its coverage with the clause “person that operates, manages, and controls the distribution and transmission of electricity, and water pipeline distribution system or sewerage pipeline system for public purpose” where Filipinos could still continue to control 60% of the corporation.

That House Bill 5828 has hurdled the third reading last Sept. 8, 2017.

Meanwhile, five bills have been filed in the Senate which also seeks to amend the Public Service Act.

If the Senate version can pass the third reading, say, March next year, the Bicameral Committee of Congress approved it by June 2018, and the pro-foreign investors' President Rodrigo Duterte signs it into law by August, we can have that FDI friendly come- on statute in the last quarter of next year.

Surely that policy could solve our unemployment and mitigate the mass exodus of our people abroad where many of them are maltreated and sexually abused by their employers in the Middle East.

Can you imagine the benefits the travelers derive if more players in the aviation industry to compete with Philippine Air Lines and Cebu Pacific whose delayed flights become a regular bane to commuters? Can you imagine investor for power plants come in droves thus decreasing the prices of electricity here that are bane too with other investors?

Isa po ang Pinas sa may pinakamahal na kuryente sa mundo.

Sa article “Philippines Has 5th Highest Cost of Electricity in the World” it says:

“No wonder even Filipino Chinese tycoons are moving out of the Philippines to put up their factories in China, where electricity rates are nearly a third of the Philippines. Have you noticed that even shampoos and toothpaste are now made in Thailand and Indonesia? Electricity in Thailand costs nearly half that of what it costs in the PH, in the cost of electricity in Indonesia is only a fifth! (Manila Times)”.

Of course the migration of big time traders in the Philippines to China is no longer feasible because as what business mogul Cezar Quimbao told me the minimum wage in the urban areas in China is P1,350 a day presently while Manila is P512 for non-agriculture worker.

But nobody rejoiced in the Philippines. Filipino and foreign investors relocated instead to Vietnam, Cambodia, and Laos because the minimum wage there is P200 a day and a businessman or corporation can owned the business 100%.

But with more public utilities in the Philippines liberally owned by investors and with the government curbing corruption and the taxing requirements a businessman has to undergo to get a franchise, the economic landscape in our country would not only be a threat to the ASEAN 10 but to the world in the snaring game of FDI.

READ:

Bad, Good News sa Ekonomiya ng Pinas

(You can read my selected columns at http://mortzortigoza.blogspot.com and articles at Pangasinan News Aro. You can send comments too at totomortz@yahoo.com)