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Get business on board

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Get business on board

/ 12:22 AM October 20, 2016

There are four things President Duterte can do right now that will convince the business community of his seriousness in supporting business and ensuring it can develop unhampered. I have increasingly heard business concerns, particularly in the foreign community, over the actions the President has taken to address the drug problem, as well as his inflammatory language. Also, he seems to have paid little attention to helping the business community, and has left it to his economic team. Which is fine as it’s mostly a good team, but he’ll send a stronger message if he becomes more involved, even more so if he does as he has promised: swift action that ignores political and bureaucratic inertia and provides business with a better deal.

To give Filipinos jobs, the only real goal of any president is to generate investment in business, and at much greater rates than in the past. We get the lowest level of foreign direct investment (FDI) among the major Asian economies. From 2010 to 2015 Singapore drew some $360 billion in FDI, the highest among the Asean 6, followed by Indonesia with $122 billion; Malaysia, $68 billion; Thailand, $57 billion; and Vietnam, $54 billion. The Philippines drew a measly $21 billion, or less than half Vietnam’s, and that’s disappointing. Vietnam used to trail its Asean peers until it decided to take an aggressive stance toward making the environment attractive to doing business in. The Philippines continues to lag because it can’t get beyond the pledge stage.

You can’t create jobs if business is wary. So an immediate message needs to be sent: that business is under no threat, and will in fact be supported in a very positive way. Here’s what should be done:

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  1. End contractualization by getting rid of security of tenure, and require that all employee benefits be paid from Day 1. The solution does not require 20 bills to solve it. It needs only one. It doesn’t need endless meetings and arguments on definitions and who should or should not be included. It just needs the Wallace solutions. Those two things will solve the problem, and everyone will benefit.
  2. Reduce corporate income taxes to 25 percent, to take effect on Jan. 1, 2017, and not phased in over time. And reorient personal taxes so the lowly-paid pay little, or nothing. The funds to cover these reductions are there, if the effort is made to get them. I listed nine sources last week.
  3. Stop the nitpicking and pass the emergency powers bill immediately. To make it a little easier, Transportation Secretary Art Tugade should remove long-term projects from the list. Stick to the short-term solutions and just three cities. Congress should act with a far greater sense of urgency (read my column “Remember: Oct. 22,” Inquirer, Page A11, 09/29/16). These lawmakers have pledged support for the President, so he should be able to convince them to approve the proposed emergency powers bill now.
  4. Rescind all the contract violations committed by the Aquino administration, and pay all the committed bills. Contract violations take but a stroke of the presidential pen to cancel the claims, and another stroke to sign the checks to pay the bills. I’ve detailed all these violations in my report, “Sanctity of Contracts” (Inquirer, Page 1, 12/25-29/15). All the President has to do is read, and act.

He has said he’ll be an action President, a man who gets things done. To hell with the consequences. If it’s right, just do it. If there are stumbling blocks, kick them out of the way. Well, here are four where a bit of kicking is called for.

The first three need both chambers of Congress to act. They are an independent body. But the President has the support of about 90 percent of all the House members and 20 of the 23 senators on his side. If he can’t convince them to act with dispatch and urgency given that overwhelming support, he can’t do anything. It’s time to just do it.

And it’s now time for him to meet business groups. Talk business, and get them onside. These five actions done would be a good start.

E-mail: wallace_likeitis@wbf.ph   Read my previous columns: www.wallacebusinessforum.com

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TAGS: business, contractualization, emergency powers, Investment, jobs, Rodrigo Duterte, taxes
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