Recto Woos Aussie Investors

Finance Secretary Ralph G. Recto has extended an invitation to Australian investors to participate in the Philippines’ "blockbuster" growth story, highlighting that the country has rolled out the red carpet and reserved the best seat for them during the Philippine Business Forum in Melbourne, Australia.

Secretary Recto urged Australian investors to invest in the country’s flagship infrastructure projects primed and ready for PPP investments under the President’s Build Better More program. I Photo: Department of Finance Facebook

“This is an exciting opportunity that Australian investors should certainly not miss out on,” he conveyed to around 100 Australian business and investment leaders and government officials during his speech on March 4, 2024, at the Ritz Carlton in Melbourne, Australia.

Secretary Recto outlined that the Department of Finance (DOF) has a comprehensive plan to drive investments-led growth through its Growth-Enhancing Actions and Resolutions (GEARs), which works in tandem with the government’s fiscal consolidation plan––the Medium-Term Fiscal Framework (MTFF).

“A key aspect of this strategy is welcoming investors with open arms to achieve investments-led growth through improvements in the regulatory regime, reduction in the cost of doing business, and addressing constraints,” he emphasized.

The Finance Chief underscored that President Ferdinand Marcos Jr.’s swift enactment of the Public-Private Partnership (PPP) Code of the Philippines is a resounding testament to the government’s commitment to fostering stronger collaboration with the private sector.

Signed into law on December 5, 2023, the PPP Code offers a stable, predictable, and competitive environment where high-quality PPP investments can thrive.

It leverages over three decades of experience with the Build-Operate-Transfer (BOT) Law and integrates best practices to streamline processes, reduce transaction costs, and enhance the ease of doing business for PPPs.

Secretary Recto urged Australian investors to invest in the country’s flagship infrastructure projects primed and ready for PPP investments under the President’s Build Better More program.

The program features 185 big-ticket infrastructure projects worth PHP 9.14 trillion (about USD 163 billion) ranging from power, physical connectivity, rural development, water resources, digitalization, sustainable initiatives, and healthcare.

The Finance Secretary assured that the government's swift approval of the solicited PPP proposal to rehabilitate the Ninoy Aquino International Airport (NAIA), the fastest approved PPP project in history evaluated in an unprecedented six weeks, demonstrates the Philippine government's efficiency in handling investments.

“Rest assured, you can expect nothing less than the same speed and efficient handling of your investments when you partner with us,” he assured.

Apart from the Build Better More program, Secretary Recto also mentioned that investors have the option to invest in other big-ticket projects through the Maharlika Investment Fund (MIF)––the Philippines’ first sovereign wealth fund.

Moreover, the Philippines also warmly welcomes expanded investment opportunities, particularly in telecommunications, transportation, banking, mining, and energy sectors, following the recent implementation of its liberalization laws and other pro-business policies.

“All these complement the investment and capital market reforms we are pursuing to align all of our initiatives with the best practices of major Asian peers,” Secretary Recto added.

With the Philippines’ very young and well-educated population (median age of 25) in contrast to Australia’s aging population (median age of 41), Secretary Recto also proposed that the two countries become demographic partners.

“Our young, tech-savvy, English-speaking workforce complements Australia’s forward-thinking businesses and highly skilled labor force. This sweet spot provides an opportunity for the Philippines and Australia to become demographic partners,” he stressed.

Aside from the business-friendly policies, Secretary Recto showcased the Philippines’ promising growth story, making it the most strategic choice for investments and partnerships in the ASEAN region.

“Keep in mind that you are teaming up with the fastest-growing economy in Asia. Our resilience has been tested and proven strong,” he concluded.

The Philippine economy grew the fastest in the ASEAN region in 2023, expanding by 5.6%.

Multilateral organizations affirm the strength of the Philippine economy, expecting it to maintain its position as a frontrunner in ASEAN with a projected GDP growth of 5.8% to 6.3% in 2024.

The Finance Chief noted the continued deceleration of the inflation rate in the country and said the DOF’s comprehensive Reduce Emerging Inflation Now (REIN) plan will ensure that this will stay within the government’s target band of 2% to 4% for the year.

Moreover, the Philippines boasts a vibrant labor market with an unemployment rate reaching a record low of 3.1% in December 2023 along with the continued reduction in the underemployment rate and faster labor force growth.

Secretary Recto likewise highlighted that the Philippines’ external position remains strong and stable, with the ratio of its reserves in 2023 over the International Monetary Fund’s (IMF) assessing reserve adequacy metric reaching 1.9–exceeding the recommended level and significantly higher than China’s 0.67, Malaysia’s 1.13, and Indonesia’s 1.14.

“This means we have a sufficient buffer against global economic headwinds,” he said.

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