Domingo, Alyssa Justhine Activity 2

Attractiveness of the Philippine Political Environment to Multinational Corporation

When multinational businesses invest in a country, job possibilities are created. They contribute
for increased incomes and expenditures in the host country's economy, which promotes growth.
Technology transfer benefits employees as well, as new machinery is imported into the host
country.

For critical economic commodities such as rice, corn, pig, chicken meat, sugar, and coffee, the
Philippines maintains a two-tiered tariff regime. A tariff rate quota (TRQ) applies to these
products, and all imports that exceed the minimum access volume are taxed at a higher out-of-
quota rate. In-quota and out-of-quota tariff rates have been unchanged since 2005, averaging
36.5 percent and 41.2 percent, respectively.

Since Philippines is one of the "most remarkable" countries in the region because of the current
administration's focus on good governance, transparency, and integrity. Most businesses are
seeking for long-term investments, and the Philippines is the greatest place to find them.
Also, sustainable investing approaches account for about $13 trillion, or 22% of global assets.

If the country is able to access these funds, it will increase its Foreign Direct Investment (FDI)
(FDIs). FDI inflows into the Philippines are currently growing at a rate of less than 20% per
year, the lowest in Southeast Asia. And also, Philippines has a lot of potential in terms of
generating international capital, not just in the stock market, which has already happened; nearly
half of the investors in the Philippine stock exchange are foreigners, but also in industry and
manufacturing.

However, if the country is serious about becoming a corporate investment destination, it must
invest in other areas of the Visayas and Mindanao. This would also aid in the achievement of
strong economic growth's cascade consequences.
 Attractiveness of the Philippine Legal Environment to Multinational Corporation

Compliance with various laws, regulations, and legal systems in different countries is a big
struggle for international businesses. The regulatory structure in place to protect small and
medium businesses (SMEs), which is primarily designed to achieve social goals, has a negative
impact on the expansion of manufacturing capacity and the achievement of economies of scale in
countries. Before engaging into legal contracts, international managers must gain a fundamental
awareness of the various legal systems used in the countries where they operate.

The independence of a country's legal system from political influences from members of
governments, residents, or businesses is critical for a company's abroad operations to be treated
fairly. Political dangers in international markets are also reduced by a fair judicial system. The
degree of judicial independence and effectiveness varies greatly between countries. Here in the
Philippines, Filipino and English are the two official languages in the Philippines. The 1987
Constitution is the primary source of law. The legal system of the country is based on Spanish
and Anglo-American law. With reservations, the Philippines recognize compulsory ICJ
jurisdiction. However, A foreign corporation must first get the relevant permits or registration
certificates from the proper government organizations before opening an office in the
Philippines. The Securities and Exchange Commission is usually the very first step for new
entities in the registration procedure. If the proposed project or activity qualifies for incentives,
the foreign investor may file an application for registration with the Board of Investments (BOI)
or the Philippine Economic Zone Authority (PEZA) under Executive Order No. 226 or Republic
Act 7916, as applicable.
 Attractiveness of the Philippine Economic Environment to Multinational Corporation

With its strategic location and robust socioeconomic programs, the Philippines is one among the
world's fastest expanding economies. In addition, there are several foreign investment prospects
in a variety of industries. Manufacturing, particularly industrial goods and agro-processing,
remains at the top of the list of chosen activities. Agriculture, fisheries, and forestry goods are all
part of commercial production. Telecommunications and cutting-edge engineering, procurement,
and construction are now priority strategic services, with ship maintenance being excluded.

In the third quarter of 2018, the Philippine GDP increased by 6.1 percent. Higher investment
opportunities and consumption, as well as the expansion of manufacturing, trade, real estate, and
rental company operations, all contribute to the reported growth. Credit rating agencies have
given it a sequence of improvements in recent years, recognizing the country's strengthening
fundamentals. Since being upgraded by Fitch Ratings, Standard & Poor's and Moody's Investor
Service in 2013, the Philippines has maintained its investment-grade status.

Only a few sectors of the economy are subject to foreign ownership restrictions. All investors
and businesses in the Philippines are guaranteed basic rights under Philippine laws and
regulations, including freedom from acquisition without just compensation. right to remit
income, capital gains, and dividends in accordance with the country's monetary authority, the
Bangko Sentral ng Pilipinas, right to repatriate the proceeds of investment liquidation and the
ability to access foreign currency in order to satisfy principle and interest payments on foreign
debt.

The 2017 IPP also represents the administration's industrial policy of attracting investments
outside of Metro Manila, favoring new participants in the industry, and encouraging inclusive
and participatory economic growth across sectors.