January 17, 2025 l Business World
I recently attended the Annual Tax Symposium of SGV & Co., where National Economic and Development Authority (NEDA) Undersecretary Rosemarie Edillon spoke eloquently about Ambisyon Natin 2040. Ambisyon Natin 2040 was conceptualized in 2015 and involved surveying about 10,000 Filipinos to understand their aspirations for 2040 to anchor the government’s developmental plans to help achieve those objectives.
To summarize our ambitions, we want the Philippines to be a prosperous, middle-class society that is more inclusive, requiring at least a tripling of per capita income from 2015 to 2040. Filipinos desire to be firmly rooted with work-life balance, allowing them to spend time with their loved ones. They also want to be comfortable, living in homes that are accessible via transportation, with children receiving quality education while everyone can also travel. Lastly, Filipinos desire to be secure with comfortable retirements, security, and a government free of corruption.
These lofty ambitions should not be out of reach for Filipinos; they are what my chairman and CEO, Ramon del Rosario, Jr., refers to as the essentials of dignified lives. Ten years into this 25-year plan, the Philippines continues to have a young, growing population with declining global competitiveness in employability, infrastructure needing further investment, and a housing backlog of more than 6.5 million affordable homes. The national poverty incidence among families was 10.9% in 2023, meaning that almost 3 million Filipinos do not have sufficient income to meet their basic needs.
The NEDA has also identified sectors that are important for achieving Ambisyon Natin 2040: housing and urban development, manufacturing, connectivity, education services, tourism and allied services, agriculture, and health and wellness services.
The challenge we face is significant, and we cannot depend solely on the government for solutions. The private sector plays a crucial role by investing in essential growth industries and upholding ethical business practices, such as paying appropriate taxes and refraining from promoting corrupt behavior. These are essential business imperatives that are likely to benefit companies, as growth industries indicate a strong demand for the products and services they will offer. Additionally, the Institute of Business Ethics found that companies with high ethical standards tend to be 10.7% more profitable.
Investments should focus on achieving the right outcomes by prioritizing both social and financial returns. This approach is becoming increasingly crucial for investors, especially as Bloomberg Intelligence predicts that global ESG (environmental, social, and governance) assets will reach $40 trillion by 2030, representing over 25% of total assets under management.
The Philippine Government has released the Philippine Development Plan (PDP) for 2023 to 2028, focusing on returning the economy to a high growth trajectory and enhancing global competitiveness. The PDP had several key focus areas: economic growth, human capital development, environmental sustainability, infrastructure, governance, health, food security and trade and investment.
These plans act as long-term guides for the government’s short-term strategies. During the SGV Tax Symposium, we heard from various government agencies, including the Bureau of Customs. They reported their accomplishments for 2024 and outlined digitalization initiatives aimed at improving revenue collection. The Philippine Economic Zone Authority (PEZA) announced that investments in 2024 exceeded P200 billion, reflecting significant foreign investment in the Philippines, which will boost employment and generate exports. The recent signing of the CREATE MORE law was also discussed as a means to attract more foreign investments by further lowering corporate taxes and providing incentives for foreign companies, making the Philippines a more competitive destination for investment.
The plans are in place and now the Philippines has to execute by working together, both the public and private sectors, to bring the plans to fruition. As Victor Hugo said, “He who every morning plans the transactions of the day and follows out that plan, carries a thread that will guide him through the labyrinth of the most busy life.”
***The views expressed herein are his own and do not necessarily reflect the opinion of his office as well as FINEX. Photo is from Pinterest.