The Philippines continues to offer business opportunities in several areas despite concerns over the proposed second tax reform package said the directors of the Israel Chamber of Commerce of the Philippines (ICCP).

In an interview with the Daily Tribune at the sidelines of the third general assembly of the Philippine Association of Digital Commerce and Decentralized Industry (PADCDI) in Makati City, ICCP director David Elefant said there are growth areas in the country that are worth “seriously looking at.”

“Investors are still coming in, depending on what they want to do,” Elefant said despite concerns over the tax reform package, particularly the proposed rationalization of fiscal incentives and cutting corporate income taxes as part of the Tax Reform for Acceleration and Inclusion (TRAIN) Act.

He said the uncertainties caused by TRAIN are creating confusion among foreign investors “who do not know what to do” at this time. The biggest worry of foreign investors is the removal of incentives inside the Philippine Economic Zone Authority (PEZA). Elefant warned that removing those incentives might discourage investors from doing business in the country.

Peza Director General Charito Plaza is opposing TRAIN 2 and blamed the second package of the tax reform agenda for the drop in investment pledges to P170.42 billion or a 36.5 percent in the second year of the Duterte administration from the P238.36 billion worth of pledges in the President’s first year in office.

Peza noted the drop was recorded in information technology, business process management, manufacturing and ecozone development.

TRAIN 2 suggests removing the 5-percent gross income earned (GIE) tax perks given to locators in Peza. Registered companies in Peza are allowed to pay the GIE in place of all taxes.

When asked if he is still confident to conduct business in the country, Elefant answered in the affirmative citing opportunities in infrastructure and tourism as offering bright spots. Financial technology (fintech), particularly blockchain also has the potential as the next “sunshine industry.”

“It all depends on what you do. There are plenty of business opportunities here, although I am doing local business. A lot of things are happening in infrastructure and tourism,” he said.

He added the release of the foreign direct investment (FDI) figure could further influence investors’ sentiments about the country.

On Thursday, the Department of Trade and Industry (DTI) reported a 165% growth in foreign direct investment (FDI) in the first semester of 2018 and expressed confidence of achieving the P680 billion this year.

At the same time, the DTI reported a 27% growth in the overall approved investments from January to June this year with a total amount of P238.9 billion compared to last year’s P188 billion of the same period.

According to the DTI – Board of Investments, this is attributed to the 165% growth in the FDI registered on the first half of the year with a total amount of P14.5 billion compared from last year’s P5.5 billion of the same period.

Also on Wednesday, the International Monetary Fund (IMF) hailed the country’s strong growth and predicted the Philippines to maintain its 6.7% GDP (gross domestic product) growth rate this year and in 2019.

“The team projects that this rate will be sustained in 2018 and 2019, underpinned by strong consumption and investment, including public investment,” IMF visiting team leader Luis E. Breuer said at the conclusion of its two-week assessment of the Philippines.

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