Amid the reported delays in the implementation of infrastructure projects under the government’s “Build, Build, Build” program, Senator Sherwin Gatchalian said he wants to relax a provision of the 80-year-old Commonwealth Act that sets restrictions on the entry of foreign contractors.
“We will file a legislative measure to allow foreign contractors to participate in government projects,” Gatchalian said.
The senator made the statement days after a Commission on Audit report showed that the Department of Public Works and Highways was only able to spend P222.66 billion out of its P610-billion budget allocated for government projects in 2017.
CoA said the low utilization rate “indicates that management was not able to effectively manage the increasing amount of funds entrusted to the agency due to low physical delivery of target project and activities.”
Gatchalian said allowing foreign contractors can speed up the implementation of the priority infrastructure projects.
In particular, he said Commonwealth Act No. 541, which gives preference to Filipino or US contractors, must be amended.
The country’s economic managers have earlier pushed for the easing of the restrictions on the Foreign Investment Negative List, especially in the area of public construction.
The 10th Foreign Investments Negative List issued in 2015 sets a maximum of 25 percent for foreign equity in public works funded domestically, which means foreign contractors can only participate via joint ventures with Filipino-owned companies.
European Chamber of Commerce of the Philippines executive director Florian Gottein said lifting the restrictions against foreign contractors would spur interest from European companies to participate in the Build, Build, Build program.
