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PEZA determined to spread ecozones in the countryside, hosts inter-agency session on AO No. 18

Wednesday, April 20, 2022

Pasay City – In continuous pursuit to implement the socio-economic agenda of the Duterte Administration, the Philippine Economic Zone Authority (PEZA), as the agency that registers and develops ecozones nationwide, has partnered with various government agencies in the conduct of an information session on Administrative Order (AO) No. 18 last April 12, 2022.

AO 18 seeks to accelerate rural progress in the countryside through the robust development of economic zones. This has mandated PEZA, along with the Department of Trade and Industry (DTI), Department of Information and Communication Technology (DICT), Department of Transportation (DOTr), Department of Public Works and Highways (DPWH), and Technical Education and Skills Development Authority (TESDA) to hasten human capital and infrastructure development to support and promote balanced social, industrial, and economic development especially in the rural area.

With this, the event aimed to provide updates on the status of the agencies’ projects and programs contributory to implementing the said AO – which was signed by President Rodrigo Roa Duterte in June 2019

PEZA Director General Charito ‘Ching’ Plaza noted, “There’s really a need for us to come together and attain a much-inclusive growth for the country, especially as we bounce back from the effects of the pandemic.”

 

Information Session on AO No. 18 with PEZA and other Stakeholders

 

AO 18 Updates: Countryside development

In her presentation, the PEZA Chief explained the Authority’s role in the creation of special economic zones in the countryside and the importance of addressing the efficiency factors which is necessary to complete the supply chain and lower the cost of doing business in the Philippines.

“PEZA is the authorized agency to register land and buildings to become economic zones, created different types of green, sustainable and smart ecozones and attract different types of industries promoting environment-friendly industrialization,” she explained.

With this, PEZA has been recognized by the IFC World Bank as having the Best practice among economic zones worldwide. The US Department of State also commented that “the business environment is notably better within the special economic zones, particularly those available for export businesses operated by PEZA, known for its regulatory transparency, no red-tape policy, and one-stop shop services for investors.”

Aside from this, Board of Investments (BOI) Governor Angelica Mapua-Cayas, who represented DTI in the forum, also expounded on the role of tax incentives in facilitating investment opportunities in the country and the agencies’ push for business-friendly zones as the main vehicle for countryside development.

Meanwhile, Undersecretary Maria Catalina Cabral of the DPWH gave updates on some of the projects under the Build, Build, Build program. She highlighted the quadruple effect of infrastructure spending in the economy and that it is an important vehicle for inclusive growth and regional development.

Focusing on the movement of people and goods, DOTr Assistant Secretary Dr. Ma. Sheilah Napalang shared the agency’s plans and programs that support rural urban connectivity for enhanced economic development.

DICT Director Emmy Lou Delfin discussed the National ICT Agenda which seeks to support the country’s gradual adaptation to digital economy and transformation. Two of the key plans under the agenda is the National Broadband Plan, which aims to provide an accessible broadband for all, and the Digital Cities program which is in support of the Philippine IT-BPM industries as they move to the countryside.

Finally, TESDA Director Angelina Carreon noted the important role of skills training for the Filipino workforce in line with countryside development. This complements in the country’s goal to increase employability of Filipinos while at the same time addressing the demands of the industries.

In terms of investment promotions, Philippine Investment Promotion Plan (PIPP) Technical Working Group Co-Chairman Administrator Francis Theodore Initorio noted that the three major clusters they determined for countryside development include the Manufacturing and Logistics, Tourism, and IT-BPM.

“We want to make sure that when we push for investment promotions, we are looking at what we can offer to our investors,” he stated.

 

PEZA Officials with the representatives of partner agencies for the implementation of AO No. 18 which was signed by President Duterte in 2019

 

Lift moratorium on new ecozones in Metro Manila

Director General Plaza noted that the Fiscal Incentives Review Board (FIRB) has again denied PEZA’s appeal to lift the moratorium in Metro Manila which was initially requested based on the pleas of the nine mayors of Metro Manila LGUs.

“Our IT Parks are only located in five business districts in Metro Manila… Nine City Mayors were complaining [saying] ‘Why are you putting a moratorium when we don’t even hosted (sic) yet one IT Park?” she explained.

Plaza further shared that the country should first address the efficiency factors which investors consider in doing business, particularly in the countryside, in order to spread investments outside the capital

On his part, PEZA Deputy Director General for Policy and Planning Mr. Tereso O. Panga also said the moratorium should be lifted already given the passage of the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act, which is a much recent and superior law.

At the same time, Panga explained that “In the very provisions of CREATE, it already provides for the criteria in setting up an IT Center in Metro Manila including listing the IT services as an eligible activity and therefore, from our understanding and with our presentation to the Board, we should already be allowing for the resumption of the declaration of IT Centers in Metro Manila.”

He also added that, “According to the [IT and Business Process Association of the Philippines], there will be an increase in the uptake from 450,000 seats to 650,000 seats. The more reason that we should be allowing this growth so that we can facilitate the spillover effects of the IT growth in the countryside.”

 

In closing, the PEZA Chief highlighted that “In order to make this work, we need to have a whole-of-government approach. We need to be united in a common goal that is to fully industrialize the country and make it into a self-reliant, self-sustaining, and resource-generating economy.”

The Information Session on AO 18 with PEZA and other Stakeholders was attended both physical and online by representatives from various government agencies, LGUs, and IPA members of the PIPP. #