The micro, small and medium enterprises in the construction sector expressed concern over the possible unregulated entry of foreign contractors into the country.
Members of the Construction Industry Authority of the Philippines said it would be “untimely” to add more players to the local construction market amid the COVID-19 pandemic, as proposed by Senate Bill 1008 and its related bills that seek to lift restrictions on the entry of foreign players to the domestic construction industry.
“MSMEs comprising 97 percent of registered contractors who are reeling from the debilitating effects of the pandemic will further be subjected to foreign competitors whose wider supply chain networks and support from their respective governments will put them at a disadvantage,” CIAP said in a 13-page position paper presented during a recent Senate hearing.
The Society of Philippine Electrotechnical Constructors and Suppliers Inc., composed of licensed electrical construction companies, said “without the necessary safeguards and programs to develop and strengthen the local industry, it would have an adverse impact on our members, most of whom are MSMEs.”
The Philippines has over 15,000 licensed contractors which provide around 4.2 million jobs, accounting for 10 percent of the total employment in the country and making it the biggest direct job contributor in the last 10 years.
“The entry of foreign contractors with their undue advantage will not only displace current professionals and workers in the industry, but will dampen employment opportunities for returning overseas Filipino workers,” CIAP said.
Concerned groups said the proposed legislation would increase the cost of constructing houses as 100 percent of foreign constructors would likely bring in high-salaried foreign engineers and managers.
The Philippine Constructors Association said in a position paper the proposed legislation “would critically impact local players—particularly the MSME sector, which make up some 97 percent of local contractors.”
Several chapters of PCA showed concern over the proposed bills that may allow the entry of wholly-owned foreign MSME constructors who may bring foreign workers and displace local workers.
PCA said it was not averse to the entry of foreign construction companies which are already allowed to operate under existing laws and regulations.
The CIAP said the liberalization of the construction industry was accepted and addressed through the years by the formulation and implementation of corresponding laws, policies and regulations such as the special licenses for joint ventures, consortia and foreign contractors and the regular license with annotation for Quadruple A companies, allowing wholly-owned or foreign corporations to regularly engage in projects.
