CEBU, Philippines - The country's weak infrastructure may weigh on the confidence of investors to bet on the economic gains the Aquino government has so far achieved, a Cebu economist said yesterday.
Cebu Business Club Executive Director Fernando Fajardo said that infrastructure bottlenecks may affect investors' "enthusiasm" toward the administration's gains in doing business and other good governance efforts.
"Failure of the government to do its part in spending its budget on time which shows to have contributed to growth slowdown last year and this year, including failing to use the ODA (official development assistance) on time," Fajardo said as one of the country's current challenges during the 5th Cebu Annual Economic and Investment Forum organized by CBC yesterday.
While the Philippines has improved tremendously in competitiveness, CBC President Gordon Alan Joseph likewise pointed out that certain questions still persist, citing the country's poor infrastructure.
"Infrastructure is still a problem," Joseph said.
Speaking at the forum, Economist Andrew Masigan stressed that the government is not investing enough for infrastructure.
"We don't have enough infrastructure... because of low government spending," Masigan, also a columnist, said.
Aside from infrastructure problem, another challenge of the country, according to Joseph, is that it is not attracting enough foreign direct investments (FDI).
"What the government has been doing for the Philippines has not translated to increase in foreign direct investments," Joseph noted.
According to Masigan, the Philippines is usually one of the least favored by foreign investors mainly because of its Constitution and other factors. He particularly cited the law that prohibits a foreign investor from fully owning a land in the country where his business is located.
While FDIs in the Philippines reached US$6.201 last year, the highest so far in the last five years of the Aquino administration, Masigan pointed out that this is still lower compared to those of the country's Asian neighbors.
ELECTION
Moving forward, Fajardo said the upcoming election also poses some impact on the economy as it may change again the country's priorities and the way national development priorities are tackled.
"What kind of leaders are we going to elect? Are they up to the challenges that are facing today and in the future?" Fajardo posed these questions as he emphasized the crucial role of future local leaders in the area of doing business.
Fajardo emphasized that the kind of the governance in the local level has much more impact on doing business. (FREEMAN)