A lawmaker has suggested an amendment to the Philippine Constitution that would relax current restrictions on foreign ownership of land. Representative Stella Quimbo believes the move would generate more jobs in the country and boost economic growth as it looks to bounce back from the COVID-19 pandemic.
“[We are already lagging behind] so we need to do extra things. We need to relax our rules and allow exemptions to land ownership by foreigners and this is one way to attract foreign capital,” Quimbo told CNN Philippines.
Current laws state that foreign citizens or corporations may acquire no more than 40 percent of a real estate development. The rest must be owned by a Philippine partner. Additionally, overseas firms have no right to own land in the country. However, it is possible to lease land for up to 50 years.
Any changes to foreign ownership laws would need to be well thought out and cautiously implemented, according to House Committee on Constitutional Amendments Vice Chair Lorenz Defensor. There is some concern that changes could be abused unless appropriate limitations or restrictions are put in place as guardrails.
Quimbo cited Thailand as an example of a country that has more relaxed foreign ownership regulations. Currently, an overseas company may hold up to 49 percent of a real estate project. And while foreign entities may not own land in the country, they can lease it for up to 90 years under Thai law.
A similar structure in the Philippines may allow the country to be more competitive when it comes to attracting overseas investment. According to Quimbo, this would create more competition in the real estate market which leads to lower prices, something that directly benefits Filipino consumers.
The House Committee on Constitutional Amendments is weighing a number of constitutional changes designed to make the Philippines more appealing to overseas investors.
