Outgoing President Rodrigo Duterte signed a bill amending the Public Services Act claiming it will “improve the delivery of essential services”. Critics worry that companies largely owned by Chinese interests will be a risk to national security.
Manila (AsiaNews/Agencies) – Less than two months before elections on 9 May, the outgoing president of the Philippines, Rodrigo Duterte, signed a bill that will allow foreigners to fully own companies in key sectors such as telecommunications and air transport.
The new law amends the Public Services Act, which limited foreign ownership to 40 per cent; this restriction will remain in place only for electricity, water distribution, oil, seaports and public utility vehicles.
For Duterte, by “easing out [. . .] foreign equity restrictions [. . .] more global investors” will be attracted. This will “modernize several sectors of public service and improve the delivery of essential services”.
The Organisation for Economic Co-operation and Development (OSCE) views such liberalisation favourably, since the Philippines has some of the world’s strictest rules on foreign investment, a factor that discourages foreign investors.
By contrast, critics of the new law argue that opening up key sectors to foreigners poses a threat to national security, a clear reference to China with which the Philippines have a dispute over territorial waters.
China Telecom already owns 40 per cent of the new Philippine telecom company, Dito Telecommunity, which launched its services last year.
The State Grid Corporation of China also owns 40 per cent of the National Grid Corporation of the Philippines, the country's power transmission monopoly.
The country’s National Economic and Development Authority rejected the criticism, noting that under the law, the president had the power to block investments "in the interest of national security”.