Encouraging foreign direct investments is critical to protect the Philippine peso from the surging United States dollar, prevent runaway inflation and help the vulnerable sector access economic opportunities.
Stefan Schmitz, president of the German-Philippine Chamber of Commerce and Industry, said that the strong US dollar and inflation are not the problem of the Philippines alone but most countries.
“This time is still sensitive because the country is coming out of Covid-19, meaning government coffers are relatively empty, then comes something like this, so the government needs to put stimulus in place. The government should look for more foreign investments,” he said in an interview.
After stepping at the P59 mark in the previous days, the peso has gradually recovered against the US dollar, closing on Friday at P58.625 from Thursday’s finish at P58.97 to a greenback.
He said the government was correct when it enacted the amendments to several laws to attract FDIs, including the Public Service Act, Foreign Investment Act, Retail Trade Liberalization Act and the Corporate Recovery and Tax Incentives for Enterprises Act, to be fully enforced immediately to lure more investors.
“But the right thing to do is for these laws to be pushed. They must lure investors and take advantage, as most countries are not happy with China. We need to see that these investments come here. But indeed, we have improvements that certainly the government should do,” he said.
Sound business environment
For Schmitz, the business climate is currently sound, and most foreign businesses that have shops in the country are counting on the administration of President Ferdinand “Bongbong” Marcos Jr.
“Before elections, there’s a bit of uncertainty, but as elections are over and more and more cabinet members are coming together, I see the climate better. With the surveys we always do with our members, I can say the business climate for them is getting better now,” according to Schmitz.
Further, he said the government should deal with FDIs in infrastructure, energy, and mining as the Philippines has many natural resources.
“There’s silver, copper, and a multitude of minerals that by now have high prices. I know it’s controversial, but responsible mining is a thing. Let’s extract those for the nation’s wealth as they own it, and it’s on their ground. But let’s make sure that this wealth is used properly, in education, infrastructure,” he said.
GPCCI belongs to the international network of the German Chambers of Commerce Abroad, which has 140 offices in 92 countries represent.
It is the official representation of German businesses in the Philippines, a bilateral membership organization with around 300 members, and a service provider to companies in their market entry and expansion.
In 2021, Germany was the Philippines’ 12th trading partner, 7th export market, and 14th import source, with total trade amounting to over $2 billion. During the same year, the top Philippine exports to Germany included electronics and semiconductor products, while the country’s top imports from Germany during the same year included laboratory chemicals, vaccines and aircraft.