As-delivered Opening Statement for the Committee of the Whole House Hearing on Constitutional Amendments

Arsenio M. Balisacan, PhD

Secretary

National Economic and Development Authority

House of Representatives, Quezon City

February 26, 2024

 

Honorable Speaker Martin Romualdez,

Senior Deputy Speaker Aurelio Gonzales,

Deputy Speaker Jay-jay Suarez,

Majority Leader Manuel Dalipe,

Distinguished members of the House of Representatives,

Colleagues in government,

Ladies and gentlemen,

Good afternoon.

I am deeply honored to address the members of the House on this most important and most fundamental matter concerning the life of our nation: the proposed amendments to the 1987 Philippine Constitution.

As stated in the Philippine Development Plan 2023-2028, the Marcos Administration aims to attain and sustain rapid and inclusive economic growth – that is, growth that creates more high-quality and better-paying jobs for our people. But growth is not an end in itself: we are aiming for the ambitious and challenging goal of reducing poverty to a single-digit level by 2028.

The National Economic and Development Authority (NEDA) believes that no less than massive amounts of investments in both physical and social infrastructure, as well as human capital, are needed to attain such a feat. Hence, NEDA recognizes the importance of updating the economic provisions in our fundamental law.

Over the last few decades – during which we have witnessed our Southeast Asian neighbors overtake us across a wide range of socioeconomic indices – these provisions, in conjunction with other binding constraints to investments, have resulted in lower levels of foreign direct investment or FDI flows to our country. Compared to our dynamic neighbors, historical data show that the Philippines has obtained a smaller share of FDI inflows that could have generated more economic and social opportunities crucial for inclusive growth and development. Globally, evidence shows a significant connection, on average, running from the extent of the country’s statutory and equity restrictiveness to the country’s realized FDI flows.

As a member of the academic community and student of Philippine economic development, we have studied and witnessed how our nation has missed several chances to attract FDI, technological know-how, and managerial talent that our economy needs to raise its productivity and competitiveness in the global arena. Though we have made significant progress, our neighbors have proceeded at a far more desirable pace. We must catch up, not be held back by uncompetitive markets dominated by a few players, expensive inputs that result in higher prices for end consumers, and incomplete value chains that prevent us from producing more technologically complex goods and services.

President Marcos has given his directive: the Constitution must be updated to meet the daunting challenges of the present and prepare us for the uncertainties and complexities of the future. We must lift restrictions on critical sectors such as public utilities, education, mass media, and advertising so that we can realize their untapped potential and enable them to contribute to the country’s economic progress.

Opening up public utilities to foreign investment will improve the quality and affordability of services, such as energy and water distribution, and offer viable options to address the financing gaps in the infrastructure sector.

In the education sector, this initiative will ensure that Filipinos can access global knowledge, skills, and technology that can nurture a culture of innovation, positioning the Philippines as a competitive hub for knowledge exchange in the region.

In this era of globalization, allowing foreign investment in mass media will also enable local media professionals to increase their global presence. More importantly, this will allow the industry to modernize, expand markets, and keep pace with international trends.

Additionally, allowing foreign investment in advertising will introduce new ideas, technologies, and best practices that can enhance the effectiveness and reinvigorate the creative excellence of our local advertising industry.

NEDA has been asked if the amendments to the Constitution are included among the priorities contained in the PDP 2023-2028. While the Plan outlines the strategies that we need to carry out to attain our medium-term targets, the reform agenda included modifications to executive issuances and specific pieces of legislation, given our current legal and regulatory framework.

To be sure, this initiative will not solve all our economic ills. Amending these economic provisions is one complementary strategy to unlock the country’s economic potential. Let me emphasize that we only reap the benefits I mentioned if we also address the other problems involving energy costs, inadequate connectivity infrastructure, slow bureaucratic processes, inconsistent local and national regulations, and highly concerning learning poverty and malnutrition. Conversely, a policy environment promoting openness to foreign investment can exert more significant pressure on the government to urgently address the complex challenges I have mentioned.

In conclusion, I urge our legislators to proceed with deliberation and prudence in considering these amendments. Let us work together to ensure that any of the changes we make are not only responsive to the needs of our time but also serve as the foundation for a more prosperous, resilient, and inclusive future for all Filipinos.

Thank you.

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