Not the perfect time to invest here (Part 2) (Continued from Tuesday)
The national government is also engaged in wasteful spending. Stacks of rice intended for disaster areas often end up rotting in government warehouses. After so-called “smart traffic lights” were purchased from abroad and installed at the intersection of major roads, the MMDA rendered them useless by closing these intersections and creating u-turn slots that build traffic bottlenecks. Almost every ranking government official uses an entourage of three to four government vehicles at any one time when traveling on the roads, even on non-working days. These vehicles are loaded with assistants, publicists, and armed bodyguards. Government funds are spent for the fuel of these vehicles and the salaries of these escorts.
Local government units are also engaged in needless spending. The Quezon City government under Mayor Herbert Bautista loves to spend taxpayer money on ceramic tiles bearing his initials and installing those tiles on city infrastructure projects to remind everybody that he is the boss in the city. Other cities like Pasig and Mandaluyong spend public money on costly but unnecessary Christmas decorations. Since the Constitution prohibits the expenditure of public money for religious activities, the celebration of Christmas using public funds raises legal issues.
A government that countenances the wasteful spending of its own people’s money is a government that will not care if foreign investors lose their investments in the country.
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To attract foreign investors in the Philippines, needless regulations must be discarded. Unfortunately, almost everything in this nation is subject to regulation, including those activities that do not need to be regulated at all.
Every enterprise in this country, big or small, is required to obtain an endless array of permits, including barangay clearances, mayor’s permits, health clearances, sanitation permits, zonal clearances, and even permits for signages and promotional activities. Registration with the Department of Trade, the Bureau of Internal Revenue, Social Security System, and the Department of Labor and Employment are also requirements in some industries. More often than not, these permits will take time to obtain, unless one is willing to pay extra in terms of “grease money” to expedite the bureaucratic process.
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Taxation is the means by which the State raises funds to pay for the expenses in governing the country. While the power of the State to tax is discretionary, the discretion cannot be attended with grave abuse. The Constitution allows the courts to inquire into the validity tax laws which are attended with grave abuse of discretion. Thus, when the government coffers are oozing with money, any law calling for an increase in taxes is a grave abuse of discretion on the part of government, and the tax becomes void. Take the case of Quezon City. Even though the city treasury has so much money, it imposes new taxes and increases existing ones, much to the prejudice of the city’s residents.
If taxes in this country are excessive, foreign investors will have second thoughts about putting their money here.
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Philippine jurisprudence has been labeled as unstable because of the so-called flip-flopping of the Supreme Court in its pronouncements. Recent examples in this regard include the cityhood law affecting certain municipalities, and the labor case involving flight attendants of Philippine Airlines.
One purpose of jurisprudence is to stabilize the legal system of a country. Foreign businessmen will not invest in a country where jurisprudence is unstable. To do so will be tantamount to taking big risks in an unfamiliar game, the rules of which are subject to amendments anytime while the game is taking place. On the other hand, stable jurisprudence allows businessmen to make high-end financial projections without anxiety.
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Lawlessness is an additional reason why foreign investors will not be keen about investing in the Philippines. Many officials of the Philippine National Police (PNP) are suspected of running a lucrative but illegal trade in firearms. When there is an illegal trade in firearms, an illegal trade in explosives cannot be too far behind. Loose firearms in the hands of bandits and other lawless individuals destabilize not just the government but an investor-friendly business environment as well. It will be akin to expecting investments in an enterprise in America’s wild west of old.
Likewise, no foreign investor is safe in a country where laws are violated with impunity. Foreign investors may be businessmen motivated largely by profits, but they also value their safety.
Truth to tell, foreign investments in the Philippines are needed in this country. Honesty and fair play, however, require those who promote the Philippines as an investment paradise to paint a true picture of what a foreign investor ought to see before he puts in his money in this country. Anything short of that degree of honesty and candor is deception. The only other choice is to rid the country of the foregoing problems.
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With so many loose firearms around, and with some members of the PNP engaged in an illegal trade in firearms, the Philippine government should stop believing the pipe dream and sales talk that peace and order will prevail in the Bangsamoro territory envisioned in the controversial Bangsamoro Basic Law (BBL) pending in Congress. The equivocal and ambiguous provisions of the proposed BBL make the Bangsamoro territory an ideal place for stockpiling firearms and explosives away from the watchful eyes of the Armed Forces of the Philippines. There is also nothing in the proposed BBL which requires the Bangsamoro entity to report and account for any financial and material donations the Bangsamoro may receive from foreign countries, Malaysia in particular, as well as from international terrorist organizations like the Al-Qaeda and the Islamic State of Iraq and Syria or ISIS for short. If the Bangsamoro entity does become a reality, it will only be a matter of time before impassionate and intolerant Bangsamoro “freedom fighters” armed with such guns and explosives declare the independence of the Bangsamoro from the Philippines.