FDIs versus DDIs Foreign Investors Cure Dermatitis; DDI Enhances Full Body Wellness (First of 2-Parts)

Some people who read my views on preferring the boosting of local industries over welcoming foreign direct investments by amending our Constitution have labeled me as either “Ultra-Nationalist” or “Leftist.”

The latest critical comment I read in this page said: “Gusto maging world class, ayaw naman sa FDI” to which I replied: “Are you saying we need foreigners to bring out the best in us?”

Let me just clarify that I am not against the entry of foreign direct investments but I oppose the idea of tinkering with the Philippine Constitution just to entice foreign investors to come.

I also do not subscribe to the idea that only by accommodating the FDIs could the country attain economic relief because they create jobs.

I cannot understand why some people are so obsessed with the FDIs and miss the fact that homegrown industries hardly get support from own local banks, most of whom easily grant huge loans to foreign companies.

Here is a very simple analogy of how I look at FDIs vis-a-vis Domestic Development Investments (DDI) which I define as local industries utilizing available raw materials and manpower (i.e. a steel processing facility or a food processing company using local production).

FDI is the ointment you rub on your dermatitis to provide immediate but temporary relief while the DDI is the healthy food that you take to bring about full body wellness.

DDI starts from the ground, boosting growth by building strong and self-sufficient families and communities through the utilization of local material and human resources.

FDI advocates who say we should emulate China and Vietnam which attained progress because they opened up to foreign investors miss the fact that while these countries indeed welcomed FDIs, they also boosted their own domestic industries, even copying the foreign technology.

Those who claim that the country had been left behind by China, Vietnam and Singapore who opened their doors to FDIs 50-60 years ago should review the history of the Parity Rights of 1946, also known as the Bell Trade Act or the Philippine Trade Act.

Dangling an $800-M economic assistance fund, the Americans succeeded in convincing Philippine Congress to amend the Constitution and insert the “Parity Rights granting U.S. citizens and corporations rights to Philippine natural resources equal to (in parity with) those of Philippine citizens, contrary to Article XIII in the 1935 Philippine Constitution.”

It was a one-sided deal favoring the Americans and their corporations which exploited Philippine natural resources, the most notorious of which were Insular Lumber tagged as singularly responsible for ravaging the forests of Negros Island and the Weyerhauser Logging Company which stripped the Mindanao’s coastal areas of Palembang, Lebak and Kalamansig of forest cover.

After they cut down the trees, they left and the areas where they operated are still among the poorest in the country.

Of course, Mindanao had its share of benefits from FDIs.

Firestone Tire Company established a plantation in Makilala, Cotabato, just a few kilometers away from my home in Nueva Vida, M’lang and that started the rubber industry in Central Mindanao.

Dole, Del Monte and Stanfilco opened plantations of pineapple, banana and lately, Hass Avocado, and provided jobs for thousands.

They have been here for almost a century engaged in agricultural production by leasing lands. I never heard these companies demand that we amend our Constitution to allow them to own lands.

Of course, the “lease and hire” incentive of these FDIs is not the most ideal set up because landowners are relegated to the status of just lessors and workers in their own land.

With the current economic situation, however, this set up is better than nothing at all.

The proposal to allow FDIs to buy and own lands and own vital industries 100% is a very dangerous idea which could subvert the country’s sovereignty and security.

Times are hard and the farmers are suffering from the flood of imports and very low prices for their produce to the point that many of them are selling their lands.

Allowing moneyed foreigners and their companies to buy land would start a frenzy of land acquisition.

We may wake up one day and discover that all the prime lands are already owned by foreigners.

#InternalGrowthMostIdeal!

#EconomicsOfTheFarmBoy!

(File photos of the Insular Lumber operations in Negros Island and the Weyerhauser Logging activities in Milbuk, Cotabato were downloaded from public websites. I give credit and thanks to the owners of the photos.)