Here’s a bit of a picture about bullying with some photo editing done. On the left you have the protectionist leftists getting their power. On the right, you have the oligarchy jeering at the foreign investor. The poor foreign investor is crying because he only gets 40% while the oligarchy are jeering because they get 60%. Youc an also see that Noynoy Aquino (the leader of the bullies together with Leni Robredo, Imelda Nicolas and Mar Roxas) is taunting the poor foreign investor because he gets 60% which means that the poor foreign investor is subjected to the bullying of the oligarchs.
So how is 60% a form of bullying? One must consider the principle of the golden rule — do to others what you want others to do unto you and never do unto others what you don’t want others to do unto you. Unfortunately, such a rule is almost non-existent in the Philippines in so many levels. Ever noticed it’s almost a norm in the Philippines where it’s okay for Filipinos to make fun of others but when it fires back that they cry foul? The same can be true for the principle of international marketing. If you want other countries to treat Filipino investors well then shouldn’t the Philippines also treat foreign investors well?
Okay, one can argue that Noynoy actually gave leeway for foreign investors by making 29 important economic amendments which improved the Philippines’ credit rating. However, the problem is that the 60/40 rule isn’t completely removed and the unreasonable negative list is still there. Just then, I heard that Japan’s Calbee is pulling out of the Philippine potato chip joint venture. Sad but true and please don’t blame President Rodrigo R. Duterte for that since he didn’t start the 60/40 rule. Sure, President Duterte may be contributing to inflation in some way such as borrowing money for infrastructure repairs. However, the whole protectionist law started with Carlos P. Garcia’s “Filipino First Policy” followed by Ferdinand E. Marcos Sr.’s crony capitalism and further continued by the Yellow Constitution’s 60/40 policy.
So how is 60/40 considered a form of bullying? Foreign investors restricted to only 40% in a joint venture while other countries give them 50-50 up to 100% in terms of ownership. True not all countries sell land to foreigners but it doesn’t mean that foreign investors are required to find a local partner to do business. Also, if they want to do a joint venture (because it can be easier to have a local partner) they are given a choice of having at least 50% shares or higher or they have the option of 100% even without the right to purchase land. The principle of 60% for Filipinos and 40% for foreigners would be like this — you can only do business only when you give us most of your earnings! Doesn’t that remind you of the school bully who extorts their richer yet physically weaker classmates of their allowances?
This is the problem of the inflow. Having the 60-40 rule gives the impression to foreign investors that they are but weaker beings in the Philippines rather than viewed as worthy competitors. They are also extorted of their profits towards the oligarchs. Some can go ahead and make the excuse that “only foreigners will get rich” because foreign investors’ income is still taxable by the Philippine government. Also, if they do get rich in the Philippines without having to remit most of their earnings to the 60% owner then it would encourage more foreign investors to come and invest in the Philippines. Unfortunately, the bully culture has raised opportunity costs in millions if not billions worth of potential taxpayers’ money that could have enriched the Philippines.