Constitution root of weak economy

Amid weakening economic sentiment, fueled by corruption issues, a political economist has floated the prospect of constitutional reform to end protectionist clauses that heavily favor Filipino ownership and goods.

- By DEXTER BARRO II

Calixto Chikiamco, president of think tank Foundation for Economic Freedom (FEF), said the supposed flaws in the 1987 Constitution are the root cause of the “weak economy” seen today.

“I think that our whole constitution should change because it’s very protectionist. It's very statist. So that’s the whole problem of our constitution,” he said during the Stratbase Group’s Pilipinas Conference.

Chikiamco said Filipino-first and Filipino-only provisions, enshrined in the Constitution to boost domestic industries, have only led to the dominance of monopolies.

While restrictions on certain sectors have been eased over the years, the main tenet of the 60-40 rule remains ingrained in the country's legal framework. That is, foreign entities may own up to 40 percent of the equity.

To help protect local industries from the potential influx of foreign firms, Chikiamco noted that the government must also introduce reforms to make them globally competitive.

“That means we need to reduce the price of food so that labor costs won't be so high,” the economist said.