The Philippine Constitution restricts foreign ownership in public utilities, mass media and advertising, educational institutions, and land. These restrictions send an unwelcome signal to foreign investors, resulting in the Philippines having one of the lowest FDI (Foreign Direct Investments) in ASEAN (Association of Southeast Asian Nations). With a very low FDI, unemployment and underemployment reach more than a quarter of the labor force. Filipinos lack the economic freedom to seek a better life for their families in their own native land, thereby forcing them to leave home and family to find gainful employment at a great social cost.
People’s economic freedom is stifled in many ways, not just in the inability of the labor force to find work. Without effective competition provided by foreign companies, Philippine oligopolies abound in key sectors of the economy. The oligopolistic structure the economy fostered by these protectionist provisions enables a few economic players to enjoy lopsided influence in the political sphere. Democratic institutions, including the judiciary, the bureaucracy, the executive and the legislature, are considerably weakened and less accountable to the broad majority of citizens.
The Foundation for Economic Freedom (FEF) sees the removal of the foreign ownership restrictions on the Constitution as vital to fostering a sustainable path of inclusive growth, one that will lead to a reduction in poverty and a better quality of life for the people. A bill amending the economic provisions of the Constitution has been filed at the Lower House and is being discussed on the floor. FEF has been actively supporting this initiative by creating more legislative champions and partners. It has written and circulated a policy paper on the issue, and started a social media campaign to generate public support.
Today, a Berlin Wall disconnects the Philippines from the lucrative benefits of foreign investment and keeps its people poorer. But it will fall, as long as organizations like FEF keep up the fight.