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BusinessWorld

PHL credibility with foreign investors hurt by business costs; charter-level reforms urged

THE PHILIPPINES needs to build credibility with foreign investors’ reforms by bringing down the cost of doing business and pursuing legal reforms at the constitutional level, a senior lawyer said.

Context & Analysis

Foreign investment decisions are rarely made on slogans alone. Investors weigh whether their money can enter, operate, and exit with reasonable certainty. For the Philippines, that means looking beyond incentives and into the everyday friction of starting a business, obtaining permits, enforcing contracts, resolving disputes, and navigating labor and property rules. If those costs remain high, even well-designed fiscal or industrial programs can look less credible to overseas capital providers.

Charter-level reform is often discussed because some restrictions on foreign ownership sit deeper than ordinary statutes. Property rights, natural resources, certain regulated industries, and aspects of the political economy may require constitutional change before foreign participation can expand meaningfully. This does not mean every problem needs a constitutional fix, but it explains why reform conversations can feel stuck: changing the Constitution is slower, more contested, and politically riskier than adjusting agency rules or tax policy.

For local businesses, the stakes are practical. Easier compliance and clearer legal boundaries can reduce uncertainty for firms of all sizes, not just multinationals. It may make it simpler to hire, finance projects, protect intellectual property, and plan longer-term investments. For consumers, more competition and broader access to goods, services, technology, and capital can support lower prices, better quality, and higher productivity in labor markets.

What to watch next is whether reform talk turns into a concrete agenda: which constitutional provisions would be addressed, what legal safeguards would accompany them, and how institutions such as Congress, the judiciary, and regulatory agencies would adjust implementation. Investors will also test credibility through routine signals—permit processing time, dispute resolution outcomes, tax administration, and consistency of policy across sectors. If the Philippines can pair structural reform with dependable enforcement, foreign confidence may improve; if it cannot, high business costs will continue to weigh on investment and growth.

Analysis by IJE Software — original commentary on the story above.

This is an excerpt. Read the full article at the original source:

Source: bworldonline.com

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