RP LOSING $300-$400 MILLION YEARLY DUE TO NULLIFIED NAIA-3 DEAL - NERI
MANILA, NOVEMBER 24, 2006 (STAR) By Ma. Elisa P. Osorio - The country is losing between $300 million to $400 million worth of foreign investments a year because of the Supreme Court decision to nullifying the contract between the government and the foreign investors who built the Ninoy Aquino International Airport Terminal 3, a top economic manager said.
At the sidelines of a legal forum held yesterday, Socioeconomic Planning Secretary Romulo L. Neri said the perception of the judiciary declaring contracts void has deterred businessmen from investing in the country.
"The NAIA will cost us about $300 million to $400 million a year in terms of investments, foreign investments especially, because they (investors) see NAIA as an example of how we deal with investments fairly or unfairly," he said.
In 2003, the contract between the government and the Philippine International Air Terminals Corp. (Piatco), including Germany’s Frankfurt Airport Services Worldwide (Fraport), was declared null and void.
The mothballed P30-billion terminal was ready for operation in 2003 but legal battles further delayed the airport’s opening.
"Who would want to invest in us with all those legal problems. Every time we have a project, the project is considered illegal or null and void," Neri noted.
According to Neri, the bigger problem caused by the voiding of the contract is "the blackeye given to us in terms of foreign investment perception."
"This is giving us a very bad name in the investment community. Whenever they come here, they point to Piatco as the reason for not coming in," he noted.
Neri added that the Piatco issue has resulted in opportunity losses.
"Investors are discouraged from coming in because of the perceived legal problem in infrastructure investments," he explained.
Legal obstacles were identified as one of the reasons why infrastructure projects are being delayed and investors are wary of bringing in business into the country.
"The main source of delay is the legal issues sometimes that’s why there are snags in the project," Neri said.
To address this problem, Neri said legal obstacles must be discussed.
"One thing is, before we can start a project we clear the legal obstacles. They should be well defined so we can address them," Neri pointed out.
Favila says APEC far from attaining vision By Marianne V. Go The Philippine Star 11/24/2006
Trade and Industry Secretary Peter B. Favila is still not convinced that a free trade pact among the 21-nation Asia-Pacific Economic Cooperation (APEC) members could be worked out given the countries’ differing economic stages.
In a presentation at the Asian Institute of Management Policy Center, Favila pointed out that "APEC is still far from attaining the vision of a community built on a shared vision of stability, security and prosperity for our peoples."
Instead, Favila said he believes that "APEC’s voluntary cooperation approach is still the most satisfactory way, though it will not deliver all aspects of free and open trade and investment."
He acknowledged though that an APEC-wide regional trading arrangement is "not an illogical trend."
In fact, he said "this is more or less what the leaders and ministers had in mind in 1994 when they agreed to the Bogor goals of free and open trade by 2010 and 2020."
Favila noted, however, that "members still differ in their views on how to achieve this goal."
One major stumbling block is the matter of trade facilitation which has always been one of APEC’s core activities since 1989.
Work on the APEC Trade Facilitation Action Plan, which started in 2001 and was given a final review this year, continues but "more needs to be done," Favila said.
Even with such doubts about an APEC free trade pact, Favila admitted that "the Philippines finds it expedient to adopt many APEC principles because they are in consonance with domestic economic reform principles."
Furthermore, Favila pointed out that the APEC market accounted for 80 percent of the Philippines’ total trade" with the country’s top trading partners comprising APEC member countries namely the United States, Japan, Singapore, China and Taiwan-Chinese Taipei which account for $58 billion or 58 percent of the Philippines’ total trade.
APEC investments also figures prominently in terms of foreign direct investments in the country, accounting for 57.05 percent of the country’s total FDI in 2004.
Chief News Editor: Sol Jose Vanzi
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