Press Release - Gatchalian backs liberalization of tech-voc education in the Philippines

Senator Win Gatchalian is backing the liberalization of the technical-vocational education sector in the Philippines, a move that he says could increase Filipinos' access to quality skills training.

"In my opinion, tech-voc should be liberalized so we can invite multinational companies. Our schools complain that equipment is expensive, but these companies can supply the equipment as long as they run the institution, but they're only allowed 40% ownership," said Gatchalian.

Within ASEAN, only the Philippines has constitutional restrictions on foreign ownership, establishment, and enrollment, while other countries address these issues through legislation, according to the Second Congressional Commission on Education (EDCOM II).

Gatchalian also emphasized the importance of providing incentives to foreign education institutions that want to establish themselves in the Philippines. For example, foreign education institutions can establish themselves in the country and agree to take in a number of Filipinos, while the government can provide the land where facilities can be built.

"It's going to be the right mix of ownership and incentives. We have to find the right mix. The point is we want to bring in foreign and international institutions with foreign technology to the country and train Filipinos. That's important because that's how we upgrade our knowledge towards the creation of an innovation-based economy," Gatchalian added.

Research by the EDCOM II also presented examples of incentives given to foreign-owned education institutions across ASEAN countries. In Malaysia, for example, international non-profit schools enjoy 100% income tax exemption, while private schools enjoy a 70% income tax relief. In Vietnam, international schools are exempted from paying corporate income tax for four years, while their tax payable for the next five years is reduced by 50%.

Gatchalian added that Congress will still have to come up with legislation should foreign ownership of education institutions be allowed. He emphasized that easing constitutional restrictions on foreign ownership of education institutions will give Congress the flexibility to respond to issues over time.

Gatc