If you’ve been thinking about doing business in the Philippines, now is the time to act. The country’s business environment is thriving.
The World Bank’s “Global Economic Prospects,” released in June 2017, ranked the Philippines10th among the fastest-growing economies in the world. This year, the country’s gross domestic product is expected to grow by 6.5 to 7.5 %, almost double its average growth rate of 3.68 % from 1982 to 2017.
Earlier in the year, the Bangko Sentral ng Pilipinas shared similarly encouraging news following the release of the 2017 Index of Economic Freedom (IEF). Now ranking 58th out of 186 nations in the world, the Philippines jumped 12 spots higher from the previous year.
As a “moderately free” economy, the Philippines has a positive relationship between its economic freedom and its more far-reaching socioeconomic goals.
These recent accolades underscore a longer term trend of progress that has been creating a more business-friendly landscape since the start of the decade.
Since 2011, the Philippines has climbed 49 spots on the World Bank–International Finance Corporation’s annual Doing Business Report, which analyzes the ease of doing business in 190 countries. With this steady rise, the Philippines claims a spot in the Top 100, ranking 99th in the 2017 report.
The World Bank cites a stable macroenomic environment as key to the growth of the Philippines. With it, the economy currently enjoys low inflation and a low debt-to-GDP ratio.
US-based think tank The Heritage Foundation likewise credits sound fiscal policy for the Philippines’ improving economic freedom. Government spending and the Philippine peso’s relatively stable medium- to long-term performance are also crucial factors, according to the Foundation.
The Philippine government is investing in massive infrastructure projects intended to create a business environment that will encourage and support more incoming foreign investments. More than 25 percent of the 2017 budget (Php 860.7 billion or US$ 16.9 billion) is allocated to building and repairing infrastructure alone.
These projects are expected to influence economic progress as a result of improved access to productive areas outside Metro Manila, including rural/agricultural regions.
If you’re exploring investment options in the Philippines, start with its Investment Priorities Plan (IPP). Below are the preferred investment areas for 2017:
Manufacturing activities and agri-processing
Agricultural enterprises, including forestry and fishery
Strategic services and industries such as creative and knowledge-based services, telecommunications, engineering, procurement, and construction (EPC), integrated circuit design, support stations for alternative energy vehicles, aircraft maintenance and repair, and industrial waste treatment
Health care services
Low-cost housing development
Infrastructure and logistics including public-private partnership projects for the benefit of local government units
Research & development (R&D) activities that drive innovation, including clinical/drug trials and business incubation hubs
Agribusiness and tourism enterprises that promote inclusive business models
Projects that promote environmental conservation and climate change mitigation
Energy-related projects, such as power generation using conventional fuels or waste materials, and the creation of battery energy storage systems
Export activities and enterprises described in the Renewable Energy Act of 2008 (R.A. No. 9513) and the Tourism Act of 2009 (R.A. No. 9593) are also cited as preferred investment activities.