SEC’s Lim sees stable regulation as key to closing investment gap

SECURITIES and Exchange Commission (SEC) Chairman Francisco Ed. Lim said he considers stable regulation, continuity of operations, and upholding ESG (environmental, social, and governance) standards to hold the key to closing the Philippines’ investment deficit relative to its ASEAN (Association of Southeast Asian Nations) neighbors.

Speaking at the European Chamber of Commerce of the Philippines’ Philippine Economic Outlook conference on Thursday, Mr. Lim said foreign investors are no longer just chasing lower costs.

As such, the Philippines could face serious problems in 2026 if it fails to rebuild investor confidence in the market, he said.

“Integrity for us is the invisible currency of investor confidence. Without it, businesses will not commit capital, and markets simply will not grow,” Mr. Lim said during a fireside chat at the conference.

He said rebuilding integrity and allowing the market to grow is possible with strong political will and consistent effort from regulators.

Mr. Lim touted SEC programs like the proposed amendments to real estate investment trust (REIT) rules as helping make the business environment more open and predictable.

Ease of doing business is another sticking point, he said. “The cost of doing business is quite high in the Philippines. I’m not only referring to the formal cost, but also to the legal cost of doing business,” he said.

He called for a rethink of regulatory approaches to favor openness and adaptability. “We should liberalize our rules. Because it’s like a race where the competitors are only 10 kilometers ahead of us… And if we keep doing the same thing every day, we’ll never pass them,” he said.

Mr. Lim backed the cautious introduction of artificial intelligence (AI) tools in regulatory processes.

“I prefer an AI system that’s home-generated… it’s a reality that we have to wrestle with. I’ve been telling our people, don’t be afraid because we can do it for you. There are things that AI can easily do as long as you have the right people.”

The SEC intends to employ AI to handle the large volume of documents and enforcement tasks that can’t be managed effectively by traditional means. — Alexandra Grace C. Magno