MANILA – The economy is expected to get a boost from the proposed amendment to the Constitution given that current focus includes the economic provisions, according to Fitch Solutions.
In a commentary dated March 7, Fitch Solutions said amendments to the economic provisions of the law, such as restrictions on foreign direct investments (FDI), will help improve the country’s global competitiveness.
It cited a report by Bloomberg regarding the approval by the House of Representatives on third and final reading of the measure creating a body that will propose amendments to the 1987 Constitution.
“While it is still early days in the process, any pro-business changes to the Philippine’s business environment would pose upside risks to our long-term growth forecast of the Philippines and in particular to investments,” it said.
The commentary said possible removal of restrictions on foreign investments will boost capital formation in the country, which historically has averaged at around 23 percent of domestic output from 2005-2002.
“Changes to legislation could see this ratio rise by several percentage points over the longer term,” it said.
Fitch Solutions said the proposed changes will not only boost foreign investments but domestic investments as well.
“We expect the administration to continue to enact pro-investment reforms over the coming quarters, especially as the President has reaffirmed his plans to make the Philippines a prime destination for foreign investors,” it added. (PNA)