August 12th, 2022
House Ways and Means Chair Joey Sarte Salceda (Albay, 2nd district) says that the country’s May 2022 foreign direct investment (FDI) performance indicates that the country is on course to reach another record-breaking year for foreign investments this year, beating the record the country set last year in the wake of the passage of the Corporate Recovery and Tax Incentives for Enterprises or CREATE Act, which Salceda also principally authored.
“We are on track to beat 2021 figures. As I have consistently said, pass CREATE, pass the FDI liberalization laws, and the 2020s will be our FDI breakout moment. That is materializing, month after month,” Salceda said.
According to data from the Bangko Sentral ng Pilipinas (BSP), the May results brought the net inflows of FDI for January to May to USD4.2 billion, an 18.8-percent jump from USD3.5 billion attained during the same period last year.
On the passage of the Public Service Act amendments on March 21, Salceda told media that the 2020s could be “the best decade for FDI in the country’s history, or at least our FDI breakout moment if the next President gets it right.”
“Now, it is up to PBBM to emphasize that his administration is committed to staying the course of stronger economic fundamentals. He has made excellent personnel choices, including his economic team, which continues the long uninterrupted tradition of appointing credible people as Finance chief,” Salceda said.
Salceda listed three “immediate” priorities for President Marcos to sustain the country’s FDI momentum.
“The agenda for PBBM, which I will wholeheartedly support him in, is one, to complete a comprehensive strategic investment priorities plan, with viable plans for using tax and non-tax support to promising sectors.”
Under the CREATE Law, the Board of Investments is tasked with crafting a strategic investment priorities plan, which lists industries eligible for tax incentives and other forms of government support. The BOI has already issued what Salceda calls the “transitional” SIPP this year.
“Second, PBBM has to resolve the PEZA leadership issue, as soon as possible. Once the leadership of the PEZA is clear, we can begin charting a course for the exports sector.”
“Third, I strongly recommend that PBBM release a framework of priority public-private partnership areas for his administration. Together with the recommendations for PPP reforms, this list will send the crucial starting signal to interested parties to PPP deals.”
“The fact that we are notching record-high FDI numbers is great. The US’s rate hikes, global economic concerns, and the lingering threat of COVID are very strong headwinds to overcome. Despite this, we remain a very strong investment option. That’s big,” Salceda said.
Salceda also said that his committee will be working on mining tax reforms to encourage more investments in the large-scale mining sector, and on the Ease of Paying Taxes Act, which tops the policy wishlist of investor and business groups in the country.
“We are passing EOPT next Wednesday, and we will begin mining tax reform discussions on that day as well,” Salceda said.