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Strengths The Philippines is one of Asia's oldest and liveliest dem ocracies. The
current constitution, fram ed in 1987 following the ousting of dictator
Ferdinand Marcos, guarantees 'life, liberty and property' in a US-style bill
of rights.
Weaknesses The executive often faces delays getting its bills through a legislature
dom inated by the Philippines' old landed fam ilies, business tycoons and
'showbiz' celebrities.
Rum ours of m ilitary coup plots are frequent. Disaffected junior officers
have staged a series of m utinies in recent years, while the top brass
played a decisive role in the 'people power' uprisings of 1986 and 2001.
O pportunities President Benigno Aquino III of the Liberal Party has prom ised to root out
the excesses of the preceding adm inistration, which could help to
recover resources lost to corruption in past years.
Tentative plans to adopt a parliam entary-style constitution, a process
referred to locally as charter change, or 'cha cha', could reduce the
concentration of executive power. Plans to eventually m ove towards a
federal structure would decentralise political power and very likely
im prove regional governance.
Developm ent plans are on the cards following the governm ent's signing
of the final com prehensive peace deal with the nation's largest Muslim
rebel force, the Moro Islam ic Liberation Front. The governm ent is also
seeking a peace agreem ent with the com m unist New People's Arm y,
which also poses a threat in the region, but progress in the talks has been
slow.
Threats Kidnappings and bom bings by separatist groups, such as the Abu Sayyaf
and the MNLF, are expected during our forecast period.
The existence of m ore than 100 private m ilitias controlled by local
warlords poses an additional security risk, as evidenced by the
Maguindanao m assacre in 2009.
Economic
SWOT ANALYSIS
Business Environment
SWOT ANALYSIS
Strengths A low-cost but educated, English-speaking workforce is the Philippines'
greatest business strength. A num ber of Western firm s have shifted their
operations, particularly call centres, to the Philippines.
The Philippines is a m em ber of the Association of South East Asian
Nations Free Trade Area, under which the association's 10 m em ber
states are com m itted to reducing tariff and non-tariff trade barriers.
Weaknesses Political and security concerns are often cited as reasons not to do
business in the Philippines. Much-needed econom ic reform s rem ain
stalled, while rebel insurgencies continue in m any parts of the country.
Ageing infrastructure, particularly in the power sector, is a key concern
for would-be foreign investors. Efforts to attract greater private funding
through build-operate-transfer schem es have m et with only lim ited
success.
O pportunities The m ove towards outsourcing by North Am erica and Western Europe
provides the Philippines with an opportunity to attract greater foreign
investm ent.
The Bangko Sentral ng Pilipinas (BSP) is endorsing legislation to
liberalise foreign bank entry. This will likely increase the num ber of
foreign banks in the country, which can help to service the investm ent
and financing interests of foreign direct investors. In turn, this will
encourage m ore foreign investm ent.
Threats C hina's rising econom ic influence presents opportunities to Philippine
firm s but also threatens to starve the country of m uch-needed foreign
investm ent.
C orruption rem ains a problem . Transparency International ranked the
Philippines 94th out of 173 countries in its 2013 C orruption Perceptions
Index.
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