{"id":9052,"date":"2020-02-13T14:17:19","date_gmt":"2020-02-13T06:17:19","guid":{"rendered":"https:\/\/www.ibon.org\/?p=9052"},"modified":"2020-02-13T14:39:06","modified_gmt":"2020-02-13T06:39:06","slug":"opening-statement-for-the-house-committee-on-constitutional-amendments-on-the-proposed-amendments-to-the-1987-constitution","status":"publish","type":"post","link":"https:\/\/www.ibon.org\/tl\/opening-statement-for-the-house-committee-on-constitutional-amendments-on-the-proposed-amendments-to-the-1987-constitution\/","title":{"rendered":"Opening Statement for the House Committee on Constitutional Amendments on the Proposed Amendments to the 1987 Constitution"},"content":{"rendered":"

IBON\nFoundation, February 12, 2020<\/em><\/p>\n\n\n\n

There\nis a strong desire for change in the country. There are very good\nreasons why. Things\nhave been very bad, for very many, for very long already. But as the\nlast few years have clearly shown, not all change is for the better. \n<\/p>\n\n\n\n

Our\ncomments today focus on the proposed amendments to the economic\nprovisions. We have also been in contact on this matter with among\nthe widest networks of people\u2019s organizations and non-government\norganizations (NGOs)\nin the country. We can only formally speak for IBON but we would like\nthe committee to know that our position closely reflects their\nsentiments as well. \n<\/p>\n\n\n\n

The\nproposed amendments cover varied sectors and areas of economic\nactivity. For now, we would like to register our general position\nwhich cuts across all of these even as the specific implications\ndiffer with the particularities of each sector.<\/p>\n\n\n\n

We\ninvite the committee to temper undue enthusiasm for foreign\ninvestment. In particular, the amount of foreign investment in the\ncountry is often misread as there being development in the country \u2013\nas if development is just about getting more foreign investment than\nothers. This is an extremely simple-minded notion.<\/p>\n\n\n\n

Foreign\ninvestment is more appropriately seen as a means to development\nrather than an end of development, which it is too often confused\nwith. They are not by any means development ends in themselves and\nthe single-minded obsession with the amount of foreign investment as\na metric of progress is widespread but wrong.<\/p>\n\n\n\n

Sound\neconomic development policy should compel the Committee to be much\nmore circumspect about changing the economic provisions including by\nthe disingenuous insertion of \u201cunless otherwise provided by law\u201d.\nThe momentum of some four decades of economic policy in the country\nis of reckless liberalization \u2013 the real objective is not mere\nlegislative flexibility but rather completion of so-called\nglobalization, notwithstanding how obsolete this has become.<\/p>\n\n\n\n

IBON\u2019s\nposition is categorically to retain the economic provisions as they\nstand. We would like to make five major points. Together they seek to\nbreak the prevalent dogmatism and put foreign investment in their\nproper historical and development context.<\/p>\n\n\n\n

First,\nforeign equity restrictions can be an important tool for development.\nThey are effective measures for exercising control over foreign\ncapital, learning production advantages, and capturing economic\nsurpluses. Already having them is an advantage that we can use to the\ncountry\u2019s benefit where Constitutional compulsion is a powerful\npoint of policy leverage. \n<\/p>\n\n\n\n

They\nare not binding constraints. Indeed, after decades of liberalization,\nthey are among the last remaining regulatory tools to build national\nindustrialization policy on. It would have been better to have a\nbigger basket of policy measures at\nhand but we are forced to make do with the\npolicy measures what we\nhave left.<\/p>\n\n\n\n

Second,\nvastly growing foreign investment into the Philippines has not\nmeaningfully contributed to national economic development as\nexpected. Domestic agriculture and industry are in long-term decline.\n\n<\/p>\n\n\n\n

Agriculture\nis its lowest share in the economy in history. The so-called\nmanufacturing resurgence has proven short-lived and domestic\nmanufacturing is a smaller part of the economy than in the 1970s and\nis down to its level in the 1950s. The largest share of foreign\ninvestment has historically gone to manufacturing.<\/p>\n\n\n\n

Will\nmore foreign investment necessarily make things better? Absent more\nrational development policy, not likely.<\/p>\n\n\n\n

Thirdly,\nthe industrialized\ncountries developed\nthrough responsible\nregulation of foreign investment for development. That they developed\nbecause they liberalized is a myth \u2013 they liberalized because they\nfirst developed.<\/p>\n\n\n\n

The\npotential benefits from foreign investment are well-known and real.\nThey are however neither intrinsic nor spontaneous and will only\nmaterialize in the right policy context. \n<\/p>\n\n\n\n

\nThis is the clear historical\nlesson from a non-free market blinded view of the experience of the\nlikes of the\nUnited States (US) and Europe in the 19th<\/sup>\nand early 20th<\/sup>\ncentury, of Japan until at least the 1950s, and of South Korea and\nTaiwan from the 1950s-1980s. And, of course, of Russia and China from\ntheir periods of Socialist revolution in 1917 and 1949 stretching\nuntil today.<\/p>\n\n\n\n

Fourthly,\nthe current global context of growing protectionism, a turnaround\nfrom investment liberalization, and eroding multilateralism make\nrelaxing foreign equity restrictions even more inappropriate.<\/p>\n\n\n\n

The\nmost powerful capitalist economies in the world have been at the\nforefront of thousands of protectionist measures since the onset of\nthe protracted global crisis in 2008. The trade war between the US\nand China grabs headlines, but protectionism is also on the rise\nacross Europe, Russia, India and elsewhere.<\/p>\n\n\n\n

The\nUnited Nations Conference on Trade and Development (UNCTAD) just last\nyear reported the declining trend in investment liberalization and,\non the other hand, growing investment restrictions. More and more\ncountries are terminating international investment agreements seen as\ndisadvantaging national development \u2013 including countries as near\nas Indonesia, further such as India, Ecuador, Venezuela and Bolivia,\nto as far away as South Africa.<\/p>\n\n\n\n

Finally,\nthe policy question is not only or even mainly how to attract foreign\ninvestment \u2013 nor even the opposite of that of how to stop it.\nUnfortunately, the fixation with the amount of foreign investment as\na metric for development success has meant thinking that everything\nshould be done to attract this even at the expense of using\nregulation to realize the potential benefits from it.<\/p>\n\n\n\n

Taking\nall these into consideration, and to reiterate, IBON\u2019s position is\ncategorically to retain the economic provisions as they stand.<\/p>","protected":false},"excerpt":{"rendered":"

The current global context of growing protectionism, a turnaround from investment liberalization, and eroding multilateralism make relaxing foreign equity restrictions even more inappropriate<\/p>","protected":false},"author":3,"featured_media":8735,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_exactmetrics_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0,"footnotes":"","_expiration-date-status":"saved","_expiration-date":0,"_expiration-date-type":"","_expiration-date-categories":[],"_expiration-date-options":[]},"categories":[961],"tags":[357,355,347,253,475,822],"acf":[],"_links":{"self":[{"href":"https:\/\/www.ibon.org\/tl\/wp-json\/wp\/v2\/posts\/9052"}],"collection":[{"href":"https:\/\/www.ibon.org\/tl\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.ibon.org\/tl\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.ibon.org\/tl\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.ibon.org\/tl\/wp-json\/wp\/v2\/comments?post=9052"}],"version-history":[{"count":1,"href":"https:\/\/www.ibon.org\/tl\/wp-json\/wp\/v2\/posts\/9052\/revisions"}],"predecessor-version":[{"id":9053,"href":"https:\/\/www.ibon.org\/tl\/wp-json\/wp\/v2\/posts\/9052\/revisions\/9053"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.ibon.org\/tl\/wp-json\/wp\/v2\/media\/8735"}],"wp:attachment":[{"href":"https:\/\/www.ibon.org\/tl\/wp-json\/wp\/v2\/media?parent=9052"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.ibon.org\/tl\/wp-json\/wp\/v2\/categories?post=9052"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.ibon.org\/tl\/wp-json\/wp\/v2\/tags?post=9052"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}