The Japanese Chamber of Commerce and Industry of the Philippines has called on President Gloria Macapagal Arroyo to keep the country competitive through extensive reforms and immediate solution of pending issues in key sectors.
The call was made as the Philippines and Japan are negotiating an economic partnership, that calls for a free trade agreement
In a letter sent to the President, the JCCIP expressed its readiness to coordinate closely with the Department of Trade and Industry to help keep the country a “better investment destination among ASEAN nations so that more direct foreign investment may flow into the country.”
But in doing so, it pointed out that the Philippines needs to bring about early solutions to pending issues which foreign investors view as impediments.
On infrastructure, the report called on early completion of pending development and improvement projects of transportation network of roads and rail transit systems. It cited the renovation of Alabang Viaduct and the extension of South Luzon Expressway and STAR Toll Road for roads, and LRT extension from Baclaran to Cavite, and MRT Line-3 extension from North Avenue to Monumento for rail transit.
In the report, the Japanese executives expressed their belief that an immediate solution to resolve issues of the NAIA Terminal 3 is in the best interest of the country. Terminal 3 with its state-of-the-art technology and facility was completed almost two years ago, but has remained idle while “the Terminal 1, which its obsolete outlook in stark contrast to modern airport terminals of neighboring countries in the region, remains to be the gateway to the capital,” the report said.
The report also cited privatization of the National Power Corporation “as the utmost priority of the Administration in alleviating current budget deficit.
On power sector reform, the report contained a seven-point proposal to attract private investment in power generating companies (GENCOs).
These are: (1) A minimum 5year government guarantee of payments to investors for electricity generated; (2) consolidation and rationalization of 119 electrical cooperatives (ECs) nationwide into clusters to help strengthen only qualified ECs; (3) government guarantee of purchase of electricity by clustered ECs; (4) reinforcement and expansion of existing network of transmission lines, preferably before the privatization of Transco; (5) detailed implementing rules and regulations to safeguard against inefficient and insufficient supply of electricity to consumers due to transmission line deficiency; (6) reasonable incentives to be provided to any GENCO that utilizes renewable sources of energy; and (7) government assurance to investors that it will not review terms and conditions of IPP contracts once the contracts are finalized and signed by the government.
The Japanese executives also raised a pending issue of payment that the Japanese contractors should receive for their work on official development assistance (ODA) projects. The amount of unpaid remians totals P347 million, including VAT for the grant-aid projects and P810 million for the Yen-Loan package projects, the report said.
