Metro Manila (CNN Philippines, October 11) — The Philippines is among the countries in Asia Pacific least likely to woo foreign investors in, according to a global think tank.
The country ranked 13th out of 14 economies in the region in Oxford Economics’ foreign direct investment (FDI) attractiveness scorecard, according to its research briefing published Monday.
“[W]e see the Philippines as being one of the least attractive among the APAC economies. This adds further weight to our forecast that the extent of economic scarring caused by the pandemic will be especially large in the Philippines,” it said.
Last July, the country placed last in the United Kingdom-based organization’s economic scarring scorecard, noting the Philippines could log the biggest drops in output compared to pre-COVID-19 levels by 2025.
Oxford Economics noted the Philippines scored high in terms of labor dynamics given its ongoing urbanization and relatively young workforce, a description it shares with Indonesia.
However, both countries performed poorly in infrastructure and business environment along with ease of doing business, it added.
Still, Oxford Economics noted the Philippines’ policy efforts to attract FDIs.
“The Philippines lowered the corporate tax rate to 20% from 30% at the start of 2021 and plans to ease mandatory local employment requirements for foreign investors,” said the think tank.
Data from the Bangko Sentral ng Pilipinas revealed FDIs plunged by 24.3% in May, but rebounded by 60.4% the month after. Inflows were at a milder pace of 52% in July.
China and Vietnam topped the FDI attractiveness scorecard, with Beijing leading about 6% increase in inflows for the region last year, according to the firm.
“We believe prospects for FDI inflows into APAC over the medium term remain strong, even though pandemic-driven supply disruptions and uncertainties over the pace of recovery may see some firms rethink their supply chains,” said Oxford Economics.
