Finance Secretary Benjamin Diokno said over the weekend structural reforms provide the domestic economy the needed boost to continue growing and recover from the devastating impact of the global health crisis.
Diokno cited the latest action of Fitch Ratings last week when it affirmed the Philippines’ “BBB” credit rating and upgraded its outlook from ‘negative’ to ‘stable’, citing the country’s solid macroeconomic fundamentals despite headwinds from domestic and external fronts.
“We will continue to rely on structural reforms that will broaden opportunities and enhance the country’s productivity,” Diokno said.
“These structural reforms will be complemented by the strategies outlined in the Philippine Development Plan 2023-2028, which will provide a conducive environment for sustainable and robust economic growth,” he said.
Some of these structural reforms are the amendments to the Public Service Act, Foreign Investments Act and Retail Trade Liberalization Act, along with the landmark Corporate Recovery and Tax Incentives for Enterprises Act.
The government also passed structural reforms that create an enabling policy environment for public-private partnerships.
‘These include the Build-Operate-Transfer Law to strengthen the financial viability and bankability of PPP projects; the improved Investment Coordination Committee guidelines to ensure faster processing and approval of PPPs; the new Joint Venture Guidelines to strengthen checks and balances; and the pending PPP Act to promote competition and protect public interest.
Diokno said the government would continue to exercise fiscal discipline through its commitment to the six-year Medium-Term Fiscal Framework. The MTFF is the Marcos administration’s plan to promote fiscal sustainability and reduce the fiscal deficit while enabling economic growth.
The proposed tax revenue measures under the MTFF such as Package 4 or the Passive lncome and Financial lntermediary Taxation Act, VAT on digital service providers and excise taxes on single-use plastics and pre-mixed alcohol are being deliberated and discussed at the House of Representatives and Senate and are expected to be implemented starting 2024.
Diokno earlier told European businessmen that the Philippines is an ideal investment destination, especially with the structural reforms implemented in recent years to lure more foreign direct investments.