Philippines relaxes foreign investment regulations to attract more business from abroad
Philippine President Rodrigo Duterte approved a law allowing foreign investment in more business sectors, Reuters cited his office as saying on March 4. The move is widely seen as a measure to boost job creation and growth in the country’s economy which has been battered hard by the Covid-19 pandemic.
The law, which amends a three-decade old foreign investment rule, allows for the first time international players to set up and fully own small- and medium-sized businesses, as well as hold 100 per cent equity in firms in sectors where they were already allowed to operate.
Previously, foreign investors could only invest in small businesses if they hired at least 50 Filipino workers.
“Foreign investments shall be encouraged in enterprises that significantly expand livelihood and employment opportunities for Filipinos,” the new law states.
It halves to $100,000 the minimum capital required to set up a business as long as foreign investors hire at least 15 local workers and introduce “advanced technology.”
Countering competition from neighbouring countries
The Philippines has long struggled to attract foreign money because of deterring issues including red tape, weak infrastructure and uncertain policies and has increasingly lost business to neighbouring countries that offer better tax breaks and lower operational costs in the past.
But the government has made recent efforts to buck this trend. Last year, Duterte lowered the minimum capital requirement for foreign retailers to set up shop in the Philippines.
Another bill, which would allow full foreign ownership of Philippine public services like telecommunications, railways, airlines and domestic shipping firms, is currently awaiting Duterte’s approval.
[caption id="attachment_38282" align="alignleft" width="300"] The Philippines' main business district in Makati, Metro Manila[/caption] Philippine President Rodrigo Duterte approved a law allowing foreign investment in more business sectors, Reuters cited his office as saying on March 4. The move is widely seen as a measure to boost job creation and growth in the country’s economy which has been battered hard by the Covid-19 pandemic. The law, which amends a three-decade old foreign investment rule, allows for the first time international players to set up and fully own small- and medium-sized businesses, as well as hold 100 per cent equity in firms...
Philippine President Rodrigo Duterte approved a law allowing foreign investment in more business sectors, Reuters cited his office as saying on March 4. The move is widely seen as a measure to boost job creation and growth in the country’s economy which has been battered hard by the Covid-19 pandemic.
The law, which amends a three-decade old foreign investment rule, allows for the first time international players to set up and fully own small- and medium-sized businesses, as well as hold 100 per cent equity in firms in sectors where they were already allowed to operate.
Previously, foreign investors could only invest in small businesses if they hired at least 50 Filipino workers.
“Foreign investments shall be encouraged in enterprises that significantly expand livelihood and employment opportunities for Filipinos,” the new law states.
It halves to $100,000 the minimum capital required to set up a business as long as foreign investors hire at least 15 local workers and introduce “advanced technology.”
Countering competition from neighbouring countries
The Philippines has long struggled to attract foreign money because of deterring issues including red tape, weak infrastructure and uncertain policies and has increasingly lost business to neighbouring countries that offer better tax breaks and lower operational costs in the past.
But the government has made recent efforts to buck this trend. Last year, Duterte lowered the minimum capital requirement for foreign retailers to set up shop in the Philippines.
Another bill, which would allow full foreign ownership of Philippine public services like telecommunications, railways, airlines and domestic shipping firms, is currently awaiting Duterte’s approval.
