BY Lamudi (28 March 2018)
Online magazine US News & World Report tagged the Philippines as the best country to invest in, ahead of nations like Indonesia, Poland, Malaysia, Singapore, and Australia. According to Bangko Sentral ng Pilipinas, foreign investments in the Philippines ballooned by as much as 57 percent, thanks to the continued positive outlook on the country’s economy.
In fact, the overall foreign direct investments (FDI) flowing into the Philippines hit a new all-time high last year at $10 billion, 21.4 percent higher than the 2016 figure. Most of these investments came from countries like the Netherlands, the U. S., Japan, Singapore, and Hong Kong, which injected funds in industries involving gas, steam, air-conditioning supply, manufacturing, real estate, constructions, and wholesale and retail trade.
With the encouraging outlook for the Philippines’ economy, there is no doubt that it will continue to be among the fastest growing countries in Asia. Furthermore, its sustainability, as well as its limited exposure to global risks and uncertainties, makes it an attractive investment site for overseas investors.
The Lamudi Housing Fair 2018 on April 21 and 22 in Quezon City is a great avenue for both local and foreign investors to connect with the country’s biggest names in the real estate industry and learn more about the Philippines’ investment landscape. Here are key reasons why now is a good and beneficial time to invest in the Philippines.
Topnotch workforce pool
With a population of over 103 million, the Philippines is a great source of quality manpower. One of the advantages of investing in the country is access to the Filipino workforce, which is composed of some of the world’s most competent and efficient workers and professionals.
With education being one of the basic social values in the country, the literacy rate among adult Filipinos stood at 96.6 percent in 2015. According to the Commission on Higher Education (CHED), the Philippines produces a high number of graduates every year, replenishing the talent pool with easily trainable and flexible individuals. In the academic year 2015-2016 alone, 645,973 students graduated from their universities.
Another thing that sets the country apart with regards to the workforce is the ability of its people to understand and speak English, a language universally used for business and commerce.
A number of policies geared towards business and economic development are already in the pipeline to make the Philippines a more viable place for local and foreign investment.
One of these is the proposed Innovation Act, which will mandate government agencies to improve public transportation and reduce the cost and days of setting up a business.
President Rodrigo Duterte’s Build, Build, Build program is also set to transform the Philippines, drastically improving the country’s infrastructure to strengthen the investment climate, create jobs, and increase the incomes of Filipino workers. The government plans to spend $158 billion over the next five years, as it rolls out 75 flagship projects consisting of airports, railways, roads, bridges, and seaports worth around $36 billion in investments. The Department of Finance (DOF) said the Build, Build, Build program would be able to generate 1.7 million jobs by 2022.
These policies support the landmark Build-Operate-Transfer (BOT) legislation, which enlisted private sector participation in major infrastructure projects in the country.
Robust infrastructure spending
The government eyes spending around seven percent of the country’s gross domestic product (GDP) for infrastructure projects, bolstering the economic foundation of the Philippines. The ambitious plan to usher the golden age of infrastructure will see the establishment of new roads, bridges, railways, and airports to improve the country’s competitiveness.
In 2017, infrastructure spending grew by 15.4 percent to % 568.8 billion, figures from the Department of Budget and Management revealed.
Better infrastructure means the economic fruits of development are shared not just in key urban areas but also rural areas, unlocking their potential as areas for business investment.
Strategic and accessible business location
Sitting at the heart of East Asia makes the Philippines a strategic location for global businesses. It takes just around four hours to fly from major capital cities across the region, and it serves as a critical gateway to the southeast Asian markets. It also acts as a manufacturing platform that can access the giant economies of Japan, China, and Korea.
Relatively cheaper business set-up costs
Compared to other countries in Asia, the Philippines has relatively more affordable and more practical business start-up costs, which includes compensation packages, utilities, space, and communication costs. According to the DFA, foreign firms that outsourced their back-office services to the Philippines recorded up to 40% of business costs savings.
The Philippines’ growth prospect
According to the International Monetary Fund (IMF) and the World Bank, the Philippines is expected to grow slightly faster this year than in 2017. The country’s commitment to infrastructure will continue to be a major catalyst for its economy, which would result in a continued confidence among investors.
For investors who are still trying to think about whether to pour their investments into the Philippines, now is the right time to take that step and unlock the wonders of what this tropical country has to offer.
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