Westmont warns fellow investors in the Philippines
Westmont warns fellow investors in the Philippines
MANILA (AFP): The head of the Westmont Group of Companies
yesterday warned fellow Malaysian investors against putting money
into "sensitive" Philippine firms after a controversial court
ruling that derailed a Malaysian company's investment plans.
"I would personally advise Malaysian businessmen investing in
the Philippines to be cautious and selective by choosing non-
sensitive types of investments," Joseph Chong Chek Ah, managing
director of the Westmont Group, said in a statement.
Chong told Malaysian investors to "avoid those which are of
national pride and key economic importance or considered to be of
historical significance," the statement said.
His comments echoed a warning by Malaysian Prime Minister
Mahathir Mohamad last weekend that Malaysian investors, among the
most aggressive in the Philippines, may be forced to scale down
their plans after the court ruling.
The Philippines' 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 that 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 newspaper
publisher Emilio Yap which had lost out to Renong in the
September 1995 auction.
Court ruling
President Fidel Ramos, credited for opening up the country's
economy, rebuked the court for interfering in the policy-making
functions of the government. He ordered government lawyers to
contest the court ruling.
The Westmont Group has substantial investments in the
Philippines, including US$40 million in Westmont Bank, Inc. and
$55 million in a floating power barge.
It plans to increase its stake when Westmont Bank expands its
share capital from 1.5 billion pesos to five billion pesos (US$58
million to $193 million dollars) in the next three years.
"We have so far felt welcomed in the Philippines and been
comfortable with the cordial business climate and governmental
regulations," Chong said.
"However, one should be careful and take cognizance ... of the
different local culture and feelings, different legal and
parliamentarian systems and of the nationalistic pride of
heritage and historical values when investing in a foreign
country," he added.
Chong said the Philippines "as a country cannot afford to
ignore the continuous role played by foreign investments in
economic growth," adding that "to shake foreign investors'
confidence ... is to move astern the growing economy."
Philippine Foreign Secretary Domingo Siazon on Tuesday said
the Philippines would launch a diplomatic campaign to refurbish
its tarnished reputation among overseas investors.
Political scientist Alex Magno told AFP yesterday that the
Supreme Court ruling "produced uncertainties which limit
opportunities."
Ramos' aides said they would ask the Supreme Court and
congress to list government assets considered part of the
national patrimony to prevent similar problems in the future.
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 the National Power Corp.