The government must increase investments in research and development (R&D) and put in place a tax regime that would be supportive of technology start-ups in the Philippines, local and foreign tech firms said on Tuesday.
During the SlingshotMNL 2015, the official tech start-up event of the Asia-Pacific Economic Cooperation (Apec), tech firms said an “enabling environment” for early-stage tech firms is lacking in the Philippines.
“Tech start-ups are not on the list of the investment-priorities plans of the Philippines. But now we’re in talks to change the language [of government plans] to make it easier for young entrepreneurs to, for example, to manage tax issues,” said Earl Valencia, President and CEO of business accelerator IdeaSpace Foundation.
Valencia said the government can also consider making investments in shared services facilities and to boost the R&D capacity of the Department of Science and Technology.
Nicholas Shea, founder of Start-Up Chile—a Chilean government-backed seed accelerator—said government cooperation is “crucial” in helping the local tech sector reach its full potential.
“The government is the partner of every Filipino company; it gets 32 percent of the taxes. If the government thinks of itself as the main partner of every company, it would want firms to prosper because a third of [company revenues] will go to government,” Shea said.
In a panel discussion, Shea said the Chilean government eased its visa restrictions for technology entrepreneurs from other countries to attract the best talent in the tech community.
Minette Navarrete, from Kickstart Ventures, added that, in terms of flexibilities, the tax environment should also be “conducive” not just to start-ups, but to investors or venture capitals that will infuse the much-needed funding to these firms.
Navarrete also called on the government to make it easier for foreign investors willing to fund local startups to secure visas. “[The technology sector] could contribute in a huge way in the country’s gross domestic product in five to six years given an environment that is conducive to its growth,” Valencia said.
Conference speakers, however, said initial steps being taken by the government, such as the putting up of student-centered Innovation Hubs in Metro Manila, is “encouraging” and that all sectors must contribute to the effort.
The Apec event wrapped up its two-day conference on Tuesday, gathering more than 1,000 Filipino start-ups from all over the country.
Representatives from well-known firms in the global start-up community such as Airbnb, Uber and Grabtaxi, as well as venture capitalists such as Golden Gate Ventures and Infuse Ventures attended the event to discuss issues and trends in start-ups sector.