Think tank IBON Foundation warned that the move to ease the Constitution’s protectionist provisions will not give the economy a shot in the arm to rebound from the effects of the Covid-19 pandemic, saying that tinkering with the Constitution at this time “will have zero efficacy for recovery, while having huge adverse side effects.”
House Speaker Lord Allan Velasco ordered last week the revival of charter change talks at the Lower House supposedly to bring in more job-generating foreign capital to help the economy heal from a pandemic-induced recession.
The idea is to insert the phrase “unless otherwise provided by law” in Article XII (National Patrimony and Economy), Article XIV (Education, Science and Technology, Arts, Culture, and Sports) and Article XVI (General Provisions) to relax limits on foreign participation in some sectors.
IBON is not convinced by Velasco’s justification for calling a Cha-Cha, saying that a large fiscal stimulus from the government would’ve done the job. The Duterte administration has been reluctant to overshoot its budget deficit limits despite rising pandemic needs, and the think tank said this hampered economic activity as a whole.
“Addressing the lack of fiscal stimulus to help the economy recover is more urgent than charter change,” IBON said. “A large stimulus package closer in magnitude to the projected P1.74 trillion contraction in GDP in 2020 will immediately spur growth, raise employment and improve the welfare of poor households,” it added.
It also said history showed charter restrictions were not hurdles to foreign direct investments that grew substantially from $1.3 billion in FDI stock in 1980 to $88 billion in 2019. It also cited evidence from developmental states of South Korea and Taiwan which in the 1980s restricted foreign imports to develop their own factories, while adding it does not make sense to open up the economy as the rest of the world is enforcing investment controls and protectionist measures.
Charter change has always been viewed with suspicion in this country where traditional politicians often prioritize their own interests. A congress that seeks to tinker with the constitution whilst the country is reeling from a pandemic should have an ironclad reason to do so. If relaxing protectionist provisions to supposedly attract more foreign investors will not make or break our economy, then maybe Congress would be better off focusing its time and attention on other more urgent matters that could actually help our country and its suffering people recover from the Covid-19 pandemic.*