Land ownership policies dampen investor's interest

Some policies pertaining to the prohibition of foreigners to own lands in our country prompted German investors to have second thoughts in setting up investments here.

Recently, the Philippines lost an opportunity to host a US$15 million (initial) investment of a Germany-based machinery firm, because of this "unfriendly" Philippine law, said Ambassador of the Federal Republic of Germany Axel Weishaupt.

Weishaupt said the "right to own" a property has remain a stumbling block why some foreign investors like those from Germany do not consider investing in the Philippines, although the country has a number of advantages, such as English speaking labor pool, among others.

Today, the favorite investment destination for German firms in Asia is China. India also has become more attractive for German investors, while Vietnam is also a strong alternative investment site.

Aside from the "land ownership" issue for foreign investors, Weishaupt also mentioned the worsening red tape, which is also one of the things that discouraged investors.

"These businesses are [supposed] to bring money here, they should have the right to own lands," the ambassador added.

He said 50 years lease contract for foreign investors is not enough, what is important he reiterated is to give the foreign investors the right to own lands here.

The Ambassador also mentioned the increasing cost of taxes in the Philippines, as one of the impediments in attracting foreign investors here.

Currently, there are over 100 German-owned companies in the Philippines, most of which are located in Luzon areas and are into machinery and special machinery, as well as sophisticated electronics production.

The Ambassador also warned that the Philippines should sustain the English proficiency niche, because there are already growing impressions abroad that the quality has deteriorated, and that this development will do no good to the Philippines in attracting investments.

The ability of Filipinos to speak good English is a "plus" factor to lure foreign investments, if this niche will not be taken care of properly, the Philippines will left behind, further.

China is catching up in terms of learning to speak good English, other countries also like India, and Vietnam are doing the same, Weishaupt said.

Weishaupt was in Cebu recently to grace the occasion of the awarding ceremony on ISO 14001 Certification to the Cebu Common Treatment Facility, Inc., a German-government supported project.

However, he said that because of Cebu's strong tourism potential, five different groups in Germany are now considering to invest hotel/resort or tourism related projects.