More legislation could be on the way to encourage foreign investors to participate in large infrastructure projects across the Philippines. Advocates of a Bill, now before Congress, believe it will strengthen the current framework and provide more stability, transparency and predictability in terms of process and thereby boost investor confidence.
The Bill’s provisions aim to encourage greater foreign participation by taking into account the prevailing cost of capital in the domestic and international markets, the risks being assumed by investors and the current tariff on similar projects. First though, the Build-Operate-Transfer (BOT) Law Amendments (aka, the PPP Act), must get through the legislative maze.
Although the House of Representatives has approved the third and final reading of the Bill very comfortably (126 for; 8 against), a counterpart Bill in the Senate is still awaiting its second reading. And the indications are that lobbyists for the large Filipino corporations – companies that in pre-PPP days would automatically be the sole bidders for the large infrastructure projects – are working hard to ensure that local business interests are well protected.