Taguig City – Philippine Economic Zone Authority (PEZA) Director General Charito B. Plaza welcomed the announcement yesterday by the Senate President Vicente “Tito” Sotto III that the Senate may delay action on economic bills, particularly the Corporate Income Tax and Incentives Reform Act (CITIRA) if the threat of the coronavirus disease (COVID-19) continues.
"We at PEZA and the affected thousands of export industries appeal to our lawmakers to put a halt on the discussion of the proposed CITIRA bill with the continuous surge and spread of the NCoV that plagued around the world,” said the PEZA Chief.
Plaza affirmed that PEZA's export industries have been affected by the NCoV as the spreading of the virus has at large affected global trading and the flow of supply chain.
“The halt of global trading due to the virus has been causing delays of exportation and importation of supply of raw materials as well as the stoppage of production of many companies in China and the rest of the world,” she said.
Particularly speaking of the coronavirus’ negative effects to exports of the Philippines, Plaza pointed out that “As reported by the Association of Semi-conductors and Electronics companies in the Philippines, more than 40% of the importations of supplies come from China suppliers, thus, the slowdown in China affected operations of PEZA's industries.”
She added that “Travel bans of many countries, likewise, affected airlines and the quarantine requirements in shipments added in the slow down of export-import activities. Worst, another consequence is that jobs had to be reduced too by companies.”
In a message conveyed by Lufthansa Technik Philippines President Elmar Lutter in his TV interview in February this year, while the big locator company employing more than three thousand Filipinos is concerned about the coronavirus outbreak, the bigger problem remains to be the uncertainties over the CITIRA bill.
Local natural disaster affects economy
Plaza explained that aside from the international threats and implications of coronavirus, “Taal volcano is showing spews of smokes again, with alert level 3 still up. With this, exporters are the most vulnerable industries affected by international and local disasters and trade and military wars, being global market-driven.
Plaza lamented that “It is shown in records and data that PEZA's performance was record-breaking with many export-industries and FDIs investing in the first year of the Duterte administration.”
“However, investments and exports started to go down at the start of the TRABAHO bill& now the CITIRA version because industries have been wary that these bills will change PEZA’s incentives regime which are already tried, tested and proven to be globally-competitive incentives package that are important to investors,” she added.
PEZA’s edge in investment promotion
Plaza shared that “PEZA is known internationally for its brand of ease of doing business, one-stop-shop, best practices, and most importantly its tried, tested, proven and globally-competitive investment package which compensate the country’s poor efficiency factors.”
“From the words of the FDIs and export industries, PEZA is the best thing that happened in the Philippines, which compensates the lack and absence of other efficiency factors such as the country’s lack of transportation & logistics hubs, its highest power rate in Asia, lack of public works & communications infrastructures, mismatch and lack of the right manpower skills needed by industries, peace and order in the countryside & unstable economic laws and policies,” she explained.
Plaza expressed hope that the Senate and the House of Representatives will take into consideration all of PEZA’s recommendations that were submitted to them respectively. She assured that PEZA shares the hope for a passage of CITIRA where its provisions are in the best interest of the country’s positive performance in investment, exports, and employment of million or thousands of Filipinos.
To date, PEZA manages 404 operating ecozones and administers incentives to more than 4,000 locator export-oriented companies according to the agency’s mandate under Republic Act No. 7916. #