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Tuesday, March 5, 2024

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FIRING LINE: Sinas, US polls & foreign contractors

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By Robert B. Roque, Jr.

Major-General Debold “Mananita” Sinas is the new Philippine National Police Chief.

Let’s party!

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Just wondering: How many Trump voters, many of whom resist wearing face masks, have died of COVID? Had they been alive to cast their votes, could they change the outcome of the election?

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Halloween is long over, but a bad idea that’s likely to leave Filipino contractors in dire straits continues to haunt me.

Philippine contractors and the Office of the Solicitor General (OSG) are pleading to the Supreme Court to reverse its decision last March 10 in which it struck down a key provision in the implementing rules and regulations of R. A. 4566, the Contractors’ License Law.

To spare you the jargon, this provision used to say that foreign contractors must first be granted a special license to engage in construction activities in the country. But with the SC ruling, foreign firms – those backed by a mightier capital – can now apply for regular licenses to participate in local construction works.

You can see why the Philippine Constructors Association Inc. (PCA) members have been sweating buckets since the decision first became public last August 26. They would have to compete with foreigners who would most likely be viewed as more capable than them.

This will especially hit contractors under the micro, small, medium enterprises (MSMEs) category. They might have barely survived the financial impact of the COVID-19 pandemic, but what about incoming the foreign contractor apocalypse?

I cannot help but see this as a replay of the wrongful implementation of the Rice Tariffication Law. While it had desirable goals (seedling support and farm mechanization for local farmers), the law essentially led to the deluge of cheaper, imported rice in the local market by getting rid of the quantitative restrictions on the staple grain in exchange for tariffs.

I’ve praised the government before for its bid to make rice more affordable for Juan and Juana and warned that the law should be executed very carefully to ensure that it would benefit farmers and not put an end to their industry with the influx of imported rice.

Clearly, that’s not what happened. The much-panned law was passed in February 2019 and, before the year was over, the Philippines was said to be the world’s biggest importer of rice. It wasn’t very pleasant for us, being an agricultural nation.

Unless something is done fast, Filipino contractors could follow the same path to misery. Also, wasn’t infrastructure development cited as the country’s ticket out of this pandemic-triggered economic slump?

Methinks this will only be true if Filipino contractors who employ Filipino workers reap profits from these construction projects or at least those that don’t have to be outsourced just because they can in light of the SC ruling. Awarding contracts to foreign firms is also a surefire way of transferring wealth away from the country, instead of keeping it here and entrusting it to the magic of economic multipliers.

Recognizing the predicament were a handful of congressmen who filed last month at least three House bills seeking to institutionalize Filipino contractors’ prioritization over their foreign counterparts when it comes to local projects. They intend to do so by tweaking RA No.4566.

One of the authors, Construction Workers Solidarity Party-List Rep. Romeo Momo Sr., said he wants to “put Filipinos first by ensuring that with the entry of foreign contractors, Filipino industry, labor, and materials are given preference”.

This is all well and good, but the legislative mill trudges slowly. It also remains to be seen if these pro-local contractor measures would be given the attention they need amid the COVID situation. In the meantime, let’s hope Pinoy contractors don’t go the way of our hapless farmers.

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SHORT BURSTS. For comments or reactions, email firingline@ymail.com or tweet @Side_View. Read current and past issues of this column at  https://thephilbiznews.com
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