RP to salvage reputation among foreign investors

RP to salvage reputation among foreign investors

MANILA (AFP): The Philippines is to launch a campaign to
salvage its reputation among overseas investors following a court
ruling that scuppered a Malaysian company's investment plans,
Foreign Secretary Domingo Siazon said yesterday.

Siazon said he would meet Malaysian Foreign Minister Abdullah
Badawi and his counterparts from major investing countries such
as Japan and the United States to assure them that the ruling was
an isolated case.

The Philippine official said he would make the same assurance
to the European Union during a meeting between Asian and European
foreign ministers in Singapore this week.

The Philippine Supreme Court on Feb. 3 declared void the sale
of a 51-percent stake in the historic Manila Hotel to Malaysia's
Renong Overseas Corp. Sdn. Bhd., saying such sites must remain
under Filipino control.

The Filipino justices, invoking a "national patrimony" clause
in the constitution, ordered the government to sell the five-star
hotel to a Filipino consortium led by Filipino-Chinese
businessman Emilio Yap which had lost out to Renong in the
September 1995 auction.

"We're talking individually" with foreign officials, Siazon
told reporters.

"I'll be meeting with Minister Badawi again to express the
same view and we will have to make this view known to other
countries which normally give us large investments."

The Manila Hotel decision triggered criticism from the
business community and drew a sharp rebuke from President Fidel
Ramos, who described it as judicial intrusion in the government's
policy-making functions.

Malaysian Prime Minister Mahathir Mohamad said last weekend
that Malaysian investors, among the most aggressive in the
Philippines, would be forced to scale down their investments.

Siazon estimated that the Philippines' infrastructure required
US$5 billion over the next 10 years.

"Where is that money coming from?" he asked, adding that
official development assistance could account for only $2.5
billion.

"So we still have the other half from private sources, so
unless you can assure investors that the level playing field is
there, they will not come," he said.

Siazon, who described the effects of the court ruling as
"bad," warned that the Philippines could lose out to other
countries in the region as an investment site.

The executive and legislative branches of government would
meet to define which government assets belong to the national
patrimony "to prevent a repetition" of the Manila Hotel
controversy, he said.

The government is selling state-run and controlled assets to
shore up its fiscal position and scrap costly subsidies. Next in
line are the power generating plants of National Power Corp.