MANILA (PNA) - Businessmen expect President Aquino's third State-of-the-Nation Address to focus on the need to pass priority legislative measures that would attract more foreign direct investments and encourage local businesses to address the pressing need for jobs creation and sustain the country's economic growth.
Atty. Miguel Varela, president of the Philippine Chamber of Commerce and Industry, said that the business community would like to pursue some economic-enhancing measures that would make the country more attractive for foreign investors to do business.
''Am sure he will talk about the gains of the economy, but we from business would like to hear the administration's priority economic bills,'' Varela said.
Already, business groups are banding together to present a common priority legislative measures they will present and for the new Congress to enact to attract more investments into the country.
PCCI, the country's largest business organization, is spearheading this initiative so the various business associations would be able to come up with a common set of legislative measures that are meant to sustain the country's robust economic growth.
According to Varela, the PCCI had held initial talks with the Management Association of the Philippines. The Joint Foreign Chambers, which is composed of foreign business chambers, welcome this initiative and are excited with the plan.
''We are coming up with proposed bills that would bring in foreign direct investments into the country,'' Varela said.
For its part, Varela said that PCCI is championing key legislations that will lock-in significant reforms that the country really needs to take off beyond its current growth track. These include the Anti-Trust/Competition Law, Rationalization of Fiscal Incentives, Customs Modernization and Tariffs Act, Land Use Code, Land Administration Reform Act and Mining Act Amendments.
On proposals to amend the Constitution to allow full foreign ownerships in some economic activities like utilities, land ownership, natural resources, education and the practice of professions, Varela said that these can be done via some legislations that would allow specific full foreign investments.
For instance, on land ownership, a bill may be filed that would allow a foreign investor full ownership over a specified period of time and specific land size that he needs for his investment.
''We are for Constitutional amendment but we should not be held back just because we cannot amend the Constitution. There are other ways by which we can provide such need of the foreign investors,'' said PCCI vice-chairman Donald Dee.
''Even without amending the Constitution, we can still attract FDIs,'' he pointed out.Coming up with a common legislative measures will give the business community the leverage to ask President Aquino to certify the bills as urgent.
The PCCI would also like the revival of the Legislative Executive Development Advisory Council (LEDAC) to also ensure that the laws they are going to come up with will have the imprimatur of Malacanang. This also ensures that more quality bills are going to come out of Congress.
Dee noted that the business community cannot stop Congress from enacting laws they feel necessary, but the business community sort of approved President Aquino's decision to veto some of those approved bills by Congress recently.
''We cannot stop them from enacting laws, but the recent laws are just out of whack. Where did that come from,'' Dee said. President Aquino has recently vetoed at least 55 flawed bills of local applications.
The 55 local bills were vetoed because they sought to convert municipal, city and provincial roads into national roads although they merely interconnect barangays (villages), municipalities and cities within their areas, or merely serve the needs of local traffic.
Aquino recently vetoed the proposed Centenarian Act offering incentives for the country's estimated 7,000 centenarians, and the Rights of Internally Displaced Persons Act of 2013 protecting the rights of internal refugees, and last month, the proposed Magna Carta of the Poor, because of its inherent flaws.
What is most ironic in the phenomenal economic growth that the Philippines is currently enjoying is that this does not really translate to jobs creation. If the Aquino government would like to achieve its ''inclusive growth'' objective, then it should provide jobs to Filipinos.
Without jobs, the much touted economic gains are unreal or at best benefiting only the upper echelons of the society as wealth did not trickle down to the poorest of the poor.
The country's unemployment rate rose to 7.5 percent in April this year from 6.9 percent in April 2012 as 600,000 farm workers lost their jobs owing to adverse weather conditions, the National Statistics Office (NSO) reported.
In its latest Labor Force Survey, the NSO said that the number of agricultural workers fell from an estimated 12.47 million in April 2012 to 11.84 million in April 2012.
The huge job loss in the farm sector, which employs about 30 percent of the total labor force, is attributed to strong typhoons that destroyed farmlands in late 2012.
The Bureau of Agriculture Statistics said farmers were hesitant to plant owing to the expected onslaught of a dry spell in the coming months, reducing job opportunities for farm workers.
Most of the 3.09 million jobless people are male, aged from 15 to 24 years old and only completed secondary school. The national capital region and the CALABARZON region posted the highest unemployment rates, with more than ten percent of their workforce unemployed.
Edgardo B. Lacson, president of the Employers Confederation of the Philippines (ECOP), said the country's jobless growth situation is expected to persist unless the government treads a new path in developing and promoting the manufacturing industry, a sure job creator but which has been neglected as economic development strategy has put more focus on the services sector.
''It is still a jobless growth because our growth is coming from services, not from the manufacturing sector, which is the biggest job creator,'' said Lacson.
Lacson noted that while BPO is a great economic driver, these investments are cost-based.
''They can easily pack up to relocate where it is cheaper,'' he pointed out.
The manufacturing sector, which entails the installation of capital equipment and machineries, cannot just abandon operations easily. The entry, however, of manufacturing projects has been hampered by the country's high-power cost.
To resolve this situation, Lacson said the government must encourage local investments in the country noting that the country's major taipans have bigger investments in China than in the Philippines.
''The Philippines should be able to adopt new strategy to attract Filipino businessmen to invest in their native country because our big Filipino businessmen are going out and investing more abroad. We should be able to attract more investments from local businessmen,'' said Lacson, who represents the voice of over 42 regular member-associations.
''Local investors are a more stable source of investments,'' added Lacson noting the economic difficulties in Europe and problems in the US.
PCCI chairman emeritus Francis Chua stressed that one measure to sustain growth is through an accelerated implementation of the Public-Private Partnership (PPP) projects.
''We hope more PPP program implementation. While surge in capital market is great, only concrete infrastructure programs can bring the wealth to the masses,'' Chua said.
Chua stressed the need to fast-track some of the PPP projects '' because we need to create jobs and for growth to really trickle down to the masses.''
The issue of infrastructure in the country was the lone sour note in the latest World Competitiveness Report of the Swiss-based International Institute for Management Development. Except for infrastructure, the Philippines has improved on three other measures of competitiveness - economic performance, government efficiency and business efficiency.
''Many roads remain unpaved and the main airport is operating beyond capacity,'' said the report. Other challenges in 2013 faced by the Philippines are corruption, unemployment, undeveloped financial system and natural disasters.
In the latest World Competitive Yearbook, the Philippines moved up 5 places to finish 38th from its previous ranking of 43rd in the 2012 report. Based on the report, infrastructure is the only factor where the Philippines experienced a decline - from 55th to 57th.
PCCI expressed optimism that with enough infrastructure spending underway, industrial output will improve in the coming quarters.
Already, the Department of Budget and Management has released 73 percent of the total budget this year to accelerate the implementation of projects and other government programs.
Noting that the two key engines of growth are government spending and consumption driven by remittances, Varela expressed PCCI's optimism that the current momentum will be sustained if these two elements remain stable and consistent.
The country's economy grew 7.8 percent in the first quarter of the year, making it the fastest growing economy in the region in that quarter beating Japan and China.
In the long term, PCCI said strong growth must be generated from agriculture and the manufacturing sectors.
It is investments in these sectors that can create quality jobs and decent incomes and that can help uplift poverty.
The Philippine economic growth has been confirmed by two of the three international debt watchers - Fitch Ratings and Standard & Poor's. Both credit raters have upgraded the country's investment ratings to the much-coveted investment grade status attesting to the government's ability to pay back its debt. Fitch upgraded the Philippines' long-term Foreign-currency issuer Default rating (IDR) to 'BBB-' from 'BB+'.
On the other hand, its long-term local-currency IDR has been raised to 'BBB' from 'BBB-' with stable outlook.
The agency has also upgraded the country ceiling to 'BBB' from 'BBB-' and the short-term foreign-currency IDR to 'F3' from 'B'.
''The Philippines' sovereign external balance sheet is considered strong relative to A range peers, let alone BB and BBB category medians,'' Fitch said in a statement, citing a persistent current account surplus underpinned by remittance inflows that helped the country obtain a net external creditor position.
Fitch's credit upgrade for the Philippines to investment grade status was announced in March this year while S & P promoted the country to an investment grade status last May 2.
Moody's Investors Service has not yet upgraded the country's credit ratings, but it earlier cited the Philippines' overall economic gains short of upgrading the country's credit standing.
The Philippines' economic growth, as measured by its gross domestic product (GDP), has been progressively growing despite the economic downturn in the global environment, expanding by 6.6 percent in 2012.
President Aquino's economic managers, led by Finance Secretary Cesar V. Purisima, have long expected the country's ratings to be raised above its former junk status as markets rated the Philippines even higher than investment grade nations.
The news about the country's investment grade status was also not a surprise to local and foreign analysts as they had expected an upgrade from any of the three major credit rating agencies to come within this year.
Credit rating upgrades are a confirmation of President Aquino's good economic management over a three-year period in office. The upgrade also reduces country's borrowing costs and would surge the foreign direct investments into the Asia's second fastest growing economy in 2012.The government us targeting GDP growth this year to reach between 6-7 percent after an upwardly revised 6.8 percent expansion the prior year.
Noting the strong growth in the manufacturing sector, Trade and Industry Secretary Gregory L. Domingo said that revival of the country's manufacturing sector is in the offing.
''Manufacturing is definitely back on track. With more plants scheduled to open,'' said Domingo.
Heightened domestic demand led to the local manufacturing sector growing at 9.7 percent in the first quarter of 2013.
Also stirring is the construction sector that was grew 32.5 percent in the first quarter, indicating a good positioning towards an industry-led economy.In addition, remittances from the overseas Filipino workers have remained robust and is expected to grow around 6 to 7 percent this year to surpass the record level of $21.39 billion in 2012. OFW remittances represent around 13.5% of the country's GDP.
Given the strong mandate of President Aquino, a consistent high approval rating and the sterling economic growth, the business community said the President is in a very good position now to push for economic reforms.

Source: Manila Bulletin - June 17, 2013