Foreign chamber sentiment on push for economic cha-cha | The Exchange
Your business is our business. Join our senior anchor Rico Hizon on The Exchange.
Foreign chambers have long been pushing for economic charter change to open up more sectors to foreign investors and businesses.
Lets now have an Exchange with the executive director of the American Chamber of Commerce, Ebb Hinchliffe.
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00:00 [Music]
00:09 Glad you're staying with us right here on The Exchange, where your business is our business.
00:14 I'm Rico Quizon.
00:16 Foreign chambers have long been pushing for economic charter change to open up more sectors to foreign investors and businesses.
00:24 Let's now have an exchange with the Executive Director of the American Chamber of Commerce, Eb Hidgecliffe.
00:30 Eb, great to have you with us.
00:31 What is the chamber's stand on the proposed economic charter change?
00:36 Oh, for a long time now, Rico, we've been absolutely adamant that we need to remove all foreign investment restrictions
00:45 and economic restrictions in the Constitution.
00:48 That's been our long-term stand.
00:50 If there's something that, you know, for the national defense or some of the national interest,
00:57 that can always be done by a law or an executive order.
01:00 You don't want it in your Constitution.
01:03 And what do you think should the Marcos administration and his colleagues do regarding charter change
01:10 if you're saying that existing laws can be amended?
01:13 Because we've already seen amendments in the Public Service Act, the Retail Liberalization Act, and the Foreign Investments Act.
01:20 Yeah, I was just saying that they do not belong in the Constitution.
01:24 We need to take them out and then pass laws accordingly.
01:27 I mean, there's things still in the Constitution, like mass media, like long-term lease can be only 25 years.
01:36 There's things in advertising.
01:38 You've got education.
01:41 Why do those belong in the Constitution?
01:43 You know, they should belong, you know, out of the Constitution and allow foreign investment into those
01:48 unless it's something in the national interest or security or those type of things.
01:53 And those then can be done.
01:55 But even now, there's still something in there about public service, even though the Public Service Act was not amended.
02:01 So when President Marcos…
02:03 It's time to get them all out.
02:05 It's time to get them all out.
02:07 So when President Marcos Jr. and his fellow lawmakers made trips to the U.S. and invited American investors,
02:14 did they make demands that before they invest, changes have to be made in the Charter's economic provisions?
02:22 No, I don't think that was the case at all.
02:25 What did happen during the Trans-Pacific Partnership negotiations, you recall,
02:29 there were certain provisions in TPP that required a country to allow reciprocity or land ownership and those type of issues.
02:38 But I think there's no demands on it.
02:41 I don't even…
02:42 I'm not sure that America is aware that the Philippines is the American business community.
02:47 I don't know if the companies here got back to their corporations and said,
02:50 "There's a move underway to amend the Constitution in the Philippines to allow more foreign ownership."
02:57 But I would like to say that what those visits did is,
03:03 what's your market calendar on March 11 and 12?
03:06 We've got a really…
03:07 The business trade mission that President Biden and President Marcos discussed during that visit,
03:13 that's now coming to reality.
03:15 And we're expecting 15 to 20 chief executive officers, top of the top, to be visiting Manila in that time period.
03:23 And continue, that'll be our turn to showcase.
03:25 And I'm sure during that time, you'll be accompanied by Commerce Secretary Gina Raimundo.
03:30 And I'm sure during that time, the conversation will be on Chaochao.
03:34 Right.
03:35 And these top CEOs who will be visiting the country, are they only here to explore?
03:42 Or are they really expressing their desire to invest in the Philippines?
03:47 I don't think they'll be coming with the…
03:51 I think the Secretary of Commerce would not ask them just to do a junket.
03:55 I think they're really serious about coming and having a look.
03:58 Many of them will be here already.
04:00 They've been in the Philippines for 50 years.
04:02 Their decision would be whether they want to continue to expand or not.
04:07 But there will be a bunch of several of them that will be coming over maybe to have the first look and say,
04:13 "Hey, is this a good place to do investment in or not?"
04:16 But Edwin Lacherda, a constitutionalist who we spoke with earlier, says that we don't really need to change the Constitution.
04:23 What we just need to do is to improve the ease of doing business.
04:27 What we also need to do is more transparency, good governance, and less corruption.
04:34 He's half right and half wrong.
04:39 We do need to amend the Constitution.
04:42 We need to open it up.
04:43 But he's absolutely right.
04:44 When American companies are looking at, as you know, one of the first things,
04:47 if not the first thing to look at, is the corruption.
04:50 And secondly, it would probably be red tape.
04:53 And when you talk to foreign investors and market strategists, they keep on scratching their heads.
04:57 I mean, we're such an open economy, but the Philippines has one of the lowest foreign direct investment numbers in the region.
05:04 FBI is in the country fell by almost 18% in 2023.
05:09 What is really preventing businesses from entering the country, Ed?
05:14 I think it's what we just talked about.
05:16 The first thing they look at is, of course, the ease of doing business.
05:20 How easy is it to get a business license once you do get that business license?
05:23 How easy is it to renew?
05:25 A lot of them, some of the ones that are restricted is, again, land ownership.
05:30 I'm not saying that AmCham is in favor of land ownership, but when you can only lease a property for 25 years and there's a limit to the size of it, that's probably a good limitation.
05:40 A good example of Rico is, if you look at the recent Justice Department ruling about 100% foreign ownership in renewable energy.
05:50 There for about two to three weeks, maybe more than, my phone rang off the hook.
05:55 You're now seeing offshore wind power form an association here.
05:59 There's a tremendous, not just interest, but already a growing investment in that sector.
06:04 Just by the lifting, who would want to invest half a billion dollars or more into something they can only own 60% of?
06:10 It goes the same thing with education.
06:13 This is the 21st century. We need to move forward.
06:17 The Constitution of 1987, it was really good for its time, but now that if you look at the things going on in the modern world, education, media, advertising, why are there restrictions on that?
06:29 So, Eb, what is your prognosis and what is your outlook? Are we going to see economic provisions charter change in 2024?
06:38 I don't have a glass ball.
06:41 We hope so. We definitely hope so.
06:47 It's always the deal about non-economic provisions that get in the way.
06:51 It just takes one or two people to say, "Wait a minute, you're doing this so you can really open up to extend the terms of the president."
06:58 When that happens, there goes the economic provisions.
07:03 We're hoping this time it will not happen, that we can get this thing done over the finish line.
07:08 Thank you so much for this Foreign Chamber Exchange, American Chamber of Commerce of the Philippines Executive Director, Eb Hinchcliffe.
07:17 And before we go, we have words from the founding fathers of the United States, Alexander Hamilton on the Constitution.
07:26 "A sacred respect for the constitutional law is the vital principle, the sustaining energy of a free government."
07:36 And this is the exchange.
07:39 We make sense of the facts and the figures and the ups and downs of the business cycle because your business is our business.
07:48 Thank you so much for watching the exchange.
07:52 I'm Rico Gizon for CNN Philippines.
07:56 News you can use. News you can trust.
08:00 (Music)