Cha-cha eyed this year

MANILA, Philippines - The Senate and the House of Representatives can approve proposals to amend certain economic provisions in the 1987 Constitution before yearend, congressional leaders said yesterday.

Speaker Feliciano Belmonte Jr. also vowed that he and Senate President Juan Ponce Enrile Jr. would immediately block proposals to amend provisions other than economic ones.

Belmonte, Enrile and House Majority Leader Neptali Gonzales II met with President Aquino on Monday to discuss constitutional reforms.

Aquino, who was initially reluctant to support Charter change (Cha-cha), finally agreed to have the issue studied by his economic managers in consultation with the private sector.

“We should decide this fairly quickly,” Belmonte said.

He stressed the House would not neglect other urgent bills in the chamber as it tackles constitutional reform proposals.

Belmonte said the House committee on constitutional amendments has nearly finished its work and is set to come up with its report that tackles only “simple amendments” to the economic provisions for plenary approval.

Gonzales added that the deliberations on the proposed P2-trillion national budget for 2013 is mostly in the various committees and not much debates are held in plenary.

Cavite Rep. Joseph Emilio Abaya, chairman of the House committee on appropriations, said the House aims to have the budget presented on the floor by September.

To save on public funds, the method of holding a plebiscite – which is to allow the people to vote for or against the proposed amendments – can be held simultaneously with the May 2013 midterm elections, Gonzales said.

Gonzales said it was also possible that the chamber would just pass a joint resolution approving the proposed amendments with a concurrent resolution coming from the Senate.

The beauty of this, Gonzales said, is that if there is something objectionable to the resolution approved by the House, such as going beyond the scope of economic provisions, the Senate can easily thumb it down.

Belmonte said the envisioned amendments would be simple and clear on which provisions would have to be fleshed out with enabling laws that require the signature of the President.

“The beauty of that approach is that when you need a law, the three political agencies of government must concur. Both houses of Congress must enact a bill. And the President, if he does not want to sign, then he can veto. So there’s protection (from abuse),” Gonzales said.

“These (amendments) don’t automatically change what’s existing now (in the Constitution) and allows Congress and the President a check and balance,” Belmonte added.

“Congress and the President can meet any changes according to the changing conditions of the world economy, and other external factors,” he said.

Belmonte said he was gratified that Aquino expressed openness to reform the Charter, as his support was crucial in the effort.

“These are simple but urgent reforms that can be accomplished in Congress early with the President’s support,” he said.

Belmonte added that he and Enrile took pains in explaining to the President that the restrictive economic provisions have been stumbling blocks in the entry of foreign investments.

Belmonte said Aquino was worried that other provisions might also be amended but was assured by congressional leaders that they would be the first to block such moves.

Among the areas that need infusion of foreign investments as explained to the President, Gonzales said, were utilization of natural resources, public utilities and land.

Also proposed for relaxation of restrictions on foreign ownership were areas of media, education and advertising, he said.

Belmonte said the mode of amending the Constitution via legislation is also the same system used by other governments.

“Other countries are also very strict on investments but when the situation changes, their lawmakers respond to the situation. But here, we are powerless to do so,” he said.

‘A reluctant participant’

Critics, on the other hand, expressed displeasure over President Aquino’s decision to look into Charter change (Cha-cha) proposals.

The militant labor group Kilusang Mayo Uno (KMU) threatened to mount massive action if the government pushes through with the planned Cha-cha.

KMU chairman Elmer Labog said Aquino appeared to be acting out a drama from a badly written script and would eventually agree to amend the Constitution.

“The ending is predictable, Aquino is miscast as a reluctant participant when it comes to Cha-cha, and the audience will be harmed, not entertained,” Labog said.

He said Aquino, whose main program is promoting public-private partnerships, is likely to support 100 percent foreign ownership of land and public utilities in the country.

“Instead of prioritizing measures that will uplift the situation of workers and the poor, they (lawmakers) will try to remove remaining hindrances to 100-percent foreign ownership of the country,” he said.

Labog called on the public to be vigilant and be ready to protest moves to amend the Constitution.

Church leaders, however, said it would leave it up to lawmakers to decide if there is a need to amend the Constitution.

“Maybe these are issues that are better discussed by people who are more knowledgeable of the situations and by people who are really of the competence to evaluate particular laws,” said Catholic Bishops’ Conference of the Philippines (CBCP) president Cebu Archbishop Jose Palma.

Palma earlier stated that the CBCP is not closing its doors on the renewed moves to amend the Charter.

“If there are laws that needed to be changed, then we are open to Cha-cha,” he said.

Flexibility

Economist John Nye stressed the need for the Philippines to change the investment environment to allow foreign investors to come in since “we are in a unique period, in a period wherein the leading economies in the world are struggling.”

“Investors are looking for places to park their money. That leads to a flood of money into new and emerging markets. But those moneys, as fast as they come in, can leave just as quickly. The way to keep them is to show that they change the investment environment not just in the short term but in the long term,” Nye said.

Nye, who holds the Fredric Bastial chair in political economy at the Mercatus Center at George Mason University, noted that infrastructure spending “is very good but they are not the be-all and end-all.”

Focus should be made on making the labor market more flexible to the new and upcoming industries, Nye said.

“I think it would be easier to invest in commercial markets, there should be attention to make the labor market more flexible… I think the labor market rules in the Philippines are too rigid, too discouraging to investors,” he added.

Nye said there seems to be more need to address economic reforms that may not be addressed alone by changing the 60-40 limit in foreign ownership in the Constitution.

Asked if Charter change could be seen as a solution, Nye agreed the provision on limiting rules on foreigners’ participation “is definitely bad for the economy.”

“On the other hand, is Cha-cha the best thing to be done? I am not sure simply because the complication and the political opposition to it may be sufficiently great,” he said.

Nye said in the Philippines, it is not easy for people to invest in the industry.

“It is not easier to get labor flexibility. That would be a problem even if you have Charter change,” he noted.

Nye lauded Aquino for the “remarkable progress” he has made in terms of the campaign against corruption and improving governance.

“I would say he has made remarkable progress and I think that the big success of the Aquino administration is that its reputation for really taking seriously corruption and for improving governance,” Nyesaid .

According to Nye, Aquino has provided a positive indicator to foreign investors that he really cares about governance.

“He really cares about showing credibility in terms of improving the reputation and the image of Philippine politics. I think that is the most positive aspect of the administration,” he said.

Nye is also founding member of the international Society for the New Institutional Economics and has been on the editorial board of the Journal of Economic History. President Aquino and Nye were batch mates at the Ateneo high school. – Christina Mendez, Mayen Jaymalin, Evelyn Macairan