Some Cebu-based businessmen have expressed support for a scheme allowing the cross-border marketing of mutual funds and other collective investment schemes in participating economies.
The Philippines and five other members of the Asia-Pacific Economic Cooperation (APEC) are the initial participants in the Asia Region Funds Passport, which is targeted to be launched next year.
The other participating economies are Australia, Japan, South Korea, Thailand and New Zealand.
Glenn Anthony Soco, director of the Mandaue Chamber of Commerce and Industry (MCCI), said the funds passport is a landmark development.
“It will definitely put us in the forefront of progress and development in the region which will likewise increase competitiveness, cooperation and awareness of our country in the global arena,” he said.
Retired banker Prudencio Gesta, a former president of the Cebu Chamber of Commerce and Industry, said the Philippines will be able to tap excess funds of other participating economies under the scheme.
“The ARFP, wherein extra funds from the members are pooled together for investment, is indeed a very encouraging move as this will give members, who need funds, easier access to the financial market while giving other members good investment opportunities for their excess funds,” he said.
Philip N. Tan, management representative to the regional wage board, said the funds may be used to finance infrastructure projects.
“What we need is to put priority on our infrastructure. We can only have so much (growth and development) with the current state of of inefficiency,” he said.
Cebu Business Club president Gordon Alan Joseph said the Philippines will have to compete with the other participating economies to attract funds.
“Is the Philippines as competitive as many of our APEC neighbors?” he asked.
The six economies that will pilot the scheme signed a Statement of Understanding on the sidelines of the APEC Finance Ministers’ Meeting last Friday.
The ARFP was first proposed by Australian Financial Centre Forum in 2010 in line with its aim to develop Australia as a leading financial services center.
Australian Finance Minister Mathias Cormann said the funds passport will help achieve greater financial integration in the Asia-Pacific region.
“It will not only reduce the amount of red tape faced by fund managers across our region, but will provide investors with greater choice of investment products,” he said.
The Philippines is awaiting evaluation this month of its application to become a signatory to the International Organization of Securities Commissions’ Appendix A of the Multilateral Memorandum of Understanding, a prerequisite for participation in the funds passport.
The memorandum provides the “tools for combating cross-border fraud and misconduct that can weaken global markets and undermine investor confidence.”