Attending a job fair yesterday, President Marcos vowed to ensure a ‘fair, transparent and enabling business environment.’
He made the promise amid reports that foreign direct investment inflows plunged to a five-year low in September, or since the global economy began collapsing in April 2020 due to the COVID pandemic.
The fall in FDI was attributed to a combination of global geopolitical uncertainties and the widening corruption scandal that has dampened business and consumer confidence.
Unemployment also rose to five percent in October, while underemployment went up to 12 percent. The Department of Labor and Employment attributed the figures to natural calamities, but other groups said the corruption scandal in flood control and other infrastructure projects contributed to the job losses.
Both assessments were correct. Extreme weather that caused deadly flooding particularly in Cebu and Negros affected jobs and livelihoods. But the corruption scandal has also frozen many projects in the construction sector – one of the biggest generators of jobs.
Preventing more job losses and attracting FDI that will generate meaningful employment will be impacted by the way the country handles corruption – not only in public works projects, but also in tax assessments and in other areas of government. Businessmen have long complained of corruption and arbitrariness in the revenue-generating agencies.
At the same time, the government must deal with long-running problems cited by investors, including inadequate infrastructure and issues on ease of doing business. The crisis in education has also eroded what was once a major edge of the country in attracting job-generating FDI.
Whenever the President travels overseas, he and his team tell potential investors that the Philippines is open for business. They must ensure that investors who do check out the business environment in the country will not instead be dismayed by monkey business.
The Philippines is in one of the most highly competitive regions in the world, but the country is becoming the regional laggard. Investors do their homework and will not be enticed merely by the rosy come-ons of public officials. The government must also do its homework.
If such rosy statements are uttered too often without being reflected in reality, the result could be even greater investment flight.