Think tank: Reduce regulatory burden to improve economy

Some regulations found to hinder investments, economic development

Think tank Philippine Institute for Development Studies (PIDS) is pushing for a review of the regulations being implemented by government agencies to ensure that the country’s policies and laws facilitate competition, innovation, productivity, and growth.
Dr. Danilo Israel, PIDS senior research fellow, said some government regulations hinder, instead of facilitate, economic development.
“We have a lot of regulations that are difficult to implement. There are also some that impose fees and charges that are too high. Some have too much red tape. Instead of solving a problem, these regulations worsen corruption,” he said in Cebuano during a Philippine Information Agency (PIA) forum last week.
Such regulations should be scrapped, and an efficient regulatory management system (RMS) be put in place to enable the Philippines to take advantage of increased trade and investment under an Asean Economic Community by the end of this year, the think tank said.
“Regulatory burdens restrain competition, productivity, and innovation, which can snowball into causing a drop in business confidence, neglect of general welfare, build-up of corruption, and, ultimately, loss of public faith in governance,” the think tank added.
An efficient RMS should have a regulatory impact assessment, which is currently not required among government regulatory agencies.
The Asian Development Bank, however, is assisting the implementation of a regulatory impact assessment regime in three government agencies, namely, Department of Tourism (DOT), Department of Labor and Employment (DOLE), and the National Economic and Development Authority (Neda).
The PIA forum last week marked the culmination of the 13th Development Policy Research Month celebration in September, which was spearheaded by the PIDS.
This year’s theme, “Tamang Regulasyon para sa Patuloy na Pag-ahon (Effective regulations for Sustainable Growth),” is a call for improving regulatory quality in the country.
There are regulations in the electricity, transport, and water sectors that are not responsive to both economic and social objectives, and business regulations that are detrimental to the investment climate, Israel said.
He said some investors, turned off by the tedious process of putting up a business, decide to skip the Philippines and go to Thailand instead.
“They say it’s easier to set up a business there (Thailand). The costs (of putting up a business) are not too high and processing is faster,” Israel said.
Lawyer Zaide Bation, regulatory division chief of the Department of Trade and Industry (DTI) in Central Visayas, said they have streamlined their processes and simplified their forms.
She said businessmen used to fill 35 items in a form, but now need only to answer 16 items, provide a photocopy of a government-issued identification card and wait for only 15 minutes for their business name applications to be processed.
Applicants can also check online for the requirements and the procedures before going to the DTI 7 office to save on time.
The department has also set up a one-stop shop to facilitate registration of new businesses. Under the one-stop shop are representatives of government agencies like the Social Security System (SSS) and PhilHealth.
Arnel Tancinco, regional director of the Land Transportation Office (LTO 7), said reforms are being implemented at their office. Registration of a newly-purchased vehicle can now be processed within seven days.
He defended some regulations, saying these are needed to teach erring drivers a lesson and discourage them from committing the same mistakes.
“We are not really interested in the revenues but we are hoping that this will deter them from making the same mistakes,” Tancinco said in the same forum.