By Jenina P. Ibañez, September 12 2019; Business World
Image Credit to Business World
THE BOARD of Investments (BoI) — which accounts for bulk of planned projects registered with investment promotion agencies — saw such pledges surge in August and year-to-date on the back of big-ticket ventures, according to a press release on Wednesday.
August alone saw investment approvals at P296.2 billion, over 17 times more than the previous year’s P17 billion, making the year-to-date tally more than double to P609.04 billion from the year-ago P269.3 billion.
The BoI — which accounts for more than 70% of committed foreign direct investments (FDI) and nearly 80% of total pledges that include those from locals — quoted its chairman, Trade Secretary Ramon M. Lopez, in a statement as noting that “big-ticket projects have begun to roll in and proves that the Philippine economy remains resilient in attracting investors despite the global slowdown.”
The eight months to August saw domestic investments registered with BoI accounting for more than three-fifths of the total at 404.5 billion, up 61.2% from a year ago, while foreign investments surged to P204.5 billion from P18.3 billion.
The Finance department quoted Undersecretary Karl Kendrick T. Chua in a statement as saying that growing investment pledges “show that the noisy naysayers against the long-due efforts to reform the country’s convoluted corporate income tax system are mistaken” in arguing that this effort will scare away foreign investors.
But Charito B. Plaza — director general of the Philippine Economic Zone Authority which is the second-biggest contributor to approved investment pledges that accounts for a fourth of FDI and nearly a fifth of total commitments — who has been at the forefront of opposition to the Finance department’s push to overhaul investors’ incentives by removing redundant ones and making the rest more time-bound and tied to economic benefits, said by phone on Wednesday that she hopes to make her case personally with President Rodrigo R. Duterte.
“We’re looking forward to have a dialogue with the president because, right now, his information and understanding is very biased and one-sided. He should talk to us,” said Ms. Plaza, who has lately asked that PEZA be spared of the proposed changes.
“If we exempt PEZA and continue with the status quo, we will attract more investors because investors are here because of our incentives.”
The eight months to August saw information and communications topping BoI-approved projects at P308.8 billion, surging from the year-ago P340 million. Power projects saw a 50.5% increase to 195.1 billion, while manufacturing pledges grew nearly three times to P62.9 billion, investments in tourism surged sevenfold to P9.2 billion and those in the human health and social work segment — hospitals — rose 69.7% to P2.3 billion.
Singapore remained the top source of investments with P170 billion, followed by the Netherlands (P9.2 billion), Thailand (P8.6 billion), Japan (P6 billion) and the United States (P2.4 billion).
The BoI said that 98% of investments in the eight months to August were outside of Metro Manila and that these investments are expected to generate 37,524 jobs, a 30.5% increase from a year ago.
Notable projects in August alone included the P141.1-billion ISOC Asia Telecom Towers, Inc. cellular tower project I, the P134.5-billion Philippines Fiber Optic Cable Network Ltd. Inc. project covering 60,000 kilometers of network cables and the P16.7-billion Republic Cement and Building Materials Inc. plant in Rizal.
“We are still on track to meet our year-end targets. We still have pending big-ticket projects that need to be thoroughly studied and evaluated,” Trade Undersecretary and BoI Managing Head Ceferino S. Rodolfo said.
“With four months remaining, we have to ensure that those who got the nod are deserving of the tax incentives and translate to more job opportunities for our countrymen.”