ENSURING a favorable environment for services trade through policy reforms is key to realizing the government’s inclusive growth agenda, experts said.
While saying that the Philippine services sector is one of the most competitive in the region and account for 53% of overall employment in the country, National Economic and Development Authority (NEDA) Deputy Director-General Emmanuel F. Esguerra said the industry still has plenty of room to grow.
"The country has been able to successfully break into all modes of supply. However, it has one of the most restrictive policy environment for services according to the World Bank,” he said at a forum in Makati City yesterday.
Mr. Esguerra said the degree of restrictiveness was highest in the practice of professional services. Foreign ownership in a number of finance-related sectors was limited as well, he added.
"Anti-competition business practices also occur even with existing regulations,” the official said.
Addressing these issues, therefore, is "essential to attaining the desired development outcome, which is inclusive growth,” Mr. Esguerra said.
This was echoed by Ramonette B. Serafica, a research consultant at state-run think tank Philippine Institute for Development Studies.
In a policy note, "Formulating the Philippine services strategy for inclusive growth”, Ms. Serafica said: "[I]mproving the competitiveness of all services is essential to transform the economy and achieve broad-based growth. If services are inefficient, costly, of poor quality, and inaccessible especially to the poorer segments of the population, inclusive growth would not be attainable.”
"Wholesale and retail trade links producers with consumers. Business services improve the efficiency of the firm and enhance product quality. Financial services enable the transformation of savings to investment,” she said.
"Telecommunications facilitate the dissemination of knowledge. Transport and logistics services move goods and people within and between countries. Education and health services enhance the productivity of the workforce.”
Government policy on innovation and human resource development are needed to create an environment conducive for investments in services, Ms. Serafica also said.
Mr. Esguerra said a competition policy is needed, as well as the formation of a consortium of services providers to create synergies.
"One might also add deliberately engaging the Filipino diaspora and tapping this market for Filipino services,” he said. --
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