MANILA — Increasing foreign direct investments (FDI) and promoting national security are not conflicting goals, Senator Grace Poe said, as she called for more competitive industries through an amended Public Service Act (PSA) of 1936.
In her speech at the BusinessWorld Industry 4.0 Summit in Taguig City, Poe said opening the telecommunications (telco), transportation, and multimedia industries to FDI — currently limited to 60 percent Filipino ownership, 40 percent foreign ownership — would help create more competitive prices and better goods and services through the entry of more competition in these markets.
“But some critics say—this is the roadblock here—there are other public services which are critical and the entry of foreigners in these industries could pose threats to national security,” Poe said.
She said “threats” include potential foreign control of telco services, and allowing entry of foreign ships through relaxed maritime cabotage laws, or the relaxation of the restriction to local transport services within the country’s waters.
“But the US restricts also the entry of foreign vessel in their waterways. Even Japan or other countries. So, our local maritime industry is a little wary of this public service act,” Poe said.
She said included in their proposed amendment to the PSA are the National Security Council’s power to review FDIs and the President’s ability to “suspend or prohibit an FDI transaction if it involves critical infrastructure that threatens to impair the national security of our country.”
Following the amendment, Poe said they expect the number of industry players, capital investments, and competition to be enhanced.
“Kasi kung may competition, kung nakikipag-paligsahan, mas bababa ang presyo, mas gagalingan mo ang serbisyo para ikaw ang piliin (Because if there is competition, if there’s a contest, there will be lower prices, you’ll provide better service so you’ll be chosen). There is an intrinsic relationship between competition and innovation,” Poe said.
Once passed, the amended PSA would change the definition of public utilities to only include distribution and transmission of electricity, water pipeline distribution systems, and sewerage pipeline systems—enabling more FDI in industries not included in this definition.
Last Sept. 4, the House of Representatives began tackling in the plenary House Bill (HB) No. 78, which would amend the PSA, following approval from the House Committee on Economic Affairs on Aug. 28.