The Philippines: The Reasons Behind FDI Growth and to Invest in This Economy

April 30, 2013

No doubt that 2012 was a great year for the Philippine economy. One of the key reasons for FDI growth in PH is the country’s strong economic performance, which continues to gain momentum. In fact, 2013 looks even brighter, with The World Bank raising its GDP growth forecast for the Philippines to 6.2% in 2013 and 6.4% in 2014. According to Moody’s, the growth rate could even reach close to 8% by 2016.

GDP Growth in the Philippines

Foreign Direct Investment has also shown high potential to grow to its highest levels in its economic history. The country’s strong economic growth, new anti-corruption measures, combined with a recent credit rating upgrade from Fitch, have improved the Philippines’ international reputation and foreign companies have begun to look at the Philippines and its growing middle class as a great opportunity to expand their businesses and operations.

Philippines might be acknowledged as the call center capital of the world, but foreign investors should look beyond that and see the potential of the Philippines to reap lucrative rewards with its strong domestic demand and growing population.

The country is certainly not the easiest country to do business in, as the recent World Bank’s Ease of Doing Business Survey has shown, but the resilience of its economy leaves no doubts. This is the time to “take a serious look” and to invest in the Philippines! The consumer sentiment, robust private consumption, increased fiscal spendingbooming services and construction sectors and higher investment and exports will continue to support the country’s economy.

The economy is relying on foreign investors to keep this growth and its reputation is definitely changing among them. Despite the restrictions of the Foreign Investment Negative List, the Philippines still allows 100% foreign ownership in almost all parts of the business sectors and the time frame for the incorporation of both local and foreign companies are just about the same.

Our experiences tell us that the biggest challenge faced by local and foreign investors is deciding which structure to establish when setting up a company in the Philippines. Understanding the reasons for FDI growth in PH is essential, as factors such as corporate classifications and outsourcing play a crucial role. Partnering with a consultancy that understands the marketplace, audience targeting methods, and coordination with government agencies ensures a smooth transition into the Philippine business landscape.

Completing dozens of company registrations for foreign and local investors, our ability to work in the Philippines can help you be part of this economic growth and establish your business or investment in the Philippines.  To obtain more information about the Philippines, please contact us at info@tripleiconsulting.com or visit us in one of our offices in Makati.

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