Government urged to arrest drop in investments

House Assistant Majority Leader Frank Perez asked government Friday to improve the country’s business climate to arrest the further decline of investments this year.

Perez said the economy is still in the process of recovery and any further disruption in the flow of investments, like what happened last year, would not do the country and the people any good.

"Authorities should see to it that investment would increase, not decrease because lesser investments mean lesser income for the government and lesser jobs for our people," said Perez, who is now in Honolulu, Hawaii attending the Asia Pacific Parliamentary Forum.

Data from the Securities and Exchange Commission (SEC) revealed that foreign investments declined by 53.75 percent or P84.705 billion in 2000 to only P39.174 billion last year.

Domestic investments also suffered a 32-percent decline. Government figures showed that domestic investments went down from P93.077 billion in 2000 to P64.043 billion last year.

Government attributed the dip in foreign investments to the global economic slowdown made even worse by the indeterminate worldwide peace and order issues. However, leading foreign investors polled by research firms pointed to the general pessimism and extreme prudence as the reasons for declining investments.

Perez said the serious global economic recession contributed to the decline in investments but it is not the main reason why foreign investors refuse to either invest or expand their operations here.

He believed that the bureaucratic red tape, the peace and order problem and the present political and labor situation in the country are the investors’ major concerns.

Perez cited the rising kidnapping cases involving foreign investors, the unabated problem of smuggling, the never-ending threats of coup d’etat and the threats of strike as among the issues that worry the investors. "The business climate is not conducive to investments," he said.

He urged the government to do something drastic to address these issues and warned that failure of authorities to act would push businessmen to pull out and transfer to countries where the climate is more conducive.