AT the first day of the meeting of the Committee of the Whole at the House of Representatives on Monday, Undersecretary Rosemarie Edillon of the National Economic and Development Authority (NEDA) National Development Policy and Planning, enlightened congressmen about the potential benefits with the proposed easing of constitutional restrictions on ownership of public utilities, educational institutions and the advertising industry.
Responding to questions posed by Manila Rep. Joel Chua, Edillon cited how the country received P800 billion in investments after the renewable energy sector was liberalized last year.
Chua asked Edillon how much investment or massive investment does the Philippines expect to gain in allowing foreign ownership of public utilities, educational institutions, as well as the advertising industry.
Edillon replied that NEDA has forecast that liberalization of the education sector would have a direct impact of increasing foreign students, which was estimated to be at 36,000.
According to her, “if we are able to double this, we can expect something like $456 million in investment, including the multiplier effects of the consumption of the students, among others. This will lead to a 0.2 percent increase in our GDP (gross domestic product).”
She highlighted other downstream benefits of a liberalized education sector, there will be more impact on the GDP because of greater collaboration, also with respect to R&D (research and development), and also innovation.
She also said that under the current economic structure of the Philippines, liberalizing or opening up the advertising industry would give the country $390 million in additional revenue.
“But right now, there is not much multiplier of this industry. And so the impact with respect to the GDP is only 0.6 percent. But we think if we will have a bigger pool of this sector, this will actually be a magnet for our creatives as well and also for the innovation sector,” Edillon said.
Chua also asked her how much investment has the Philippines been losing because of the restrictive economic provisions in the Constitution.
Edillon answered Chua using comparative investment statistics of the Philippines and Vietnam in 1990 and in 2000. In 1990, she said Vietnam had only $243 million foreign direct investments, whereas the Philippines had $3.26-billion. In 2022, Edillon said the Philippines received $113-billion, while Vietnam received $210-billion.
“We are looking at a difference of $100 billion, and a lot of these is due to the liberalization efforts that were done by Vietnam,” she emphasized.
The committee of the whole convened Monday to discuss Resolution of Both Houses (RBH) No. 7, which proposes to amend Articles XII, XIV and XVI of the 1987 Constitution, similar to RBH 6 filed in the Senate.
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