Warnings vs telcos might affect investor sentiment – business group

President Rodrigo Duterte’s warning against the country’s giant telecommunication companies could scare off foreign investors, resulting in the loss of trade and foreign investments, a business group warned.

American Chamber of Commerce of the Philippines (AmCham) Senior Adviser John Forbes said that Duterte’s tirade against the so-called duopoly of PLDT and Globe Telecom may affect foreign investors’ sentiment on the Philippines.

“The warning to possibly nationalize major utilities in which there are billions of dollars owned by foreign investors could harm the external opinion of the country’s investment climate stability,” Forbes said in a statement.

He said that foreign investors might see the country as an investment risk because of the President’s threats.

In his fifth state of the nation address, Duterte threatened to shut down PLDT and Globe if they failed to improve their services by the end of the year.

Fitch Solutions also issued a warning in June when majority of the members of the House of Representatives voted against granting a fresh franchise to the Lopez-led ABS-CBN Corp.

“The regulator’s [National Telecommunication Commission] apparent ability to be influenced by the government continues to be a key impediment to foreign investor sentiment, and has also made the telecoms landscape difficult for both new entrants and existing players,” Fitch Solutions said.

Dito Telecommunity, the challenger to the duopoly, which is backed by Dennis Uy, and state-run China Telecommunications Corp. is set to roll out its commercial services in March next year.

PLDT and Globe vowed to further ramp up their network expansion but stressed that they would need help from the government because red tape hindered the speedy establishment of cell towers nationwide.

Source: TheManila Times