Philippine Standard Time - Sunday, July 21, 2024,

PEZA keeps momentum going from PBBM's first 100 days: Attracted nearly PhP 40 Billion investments from Jan-Sept 2022

Sunday, October 16, 2022

Pasay City – The Philippine Economic Zone Authority (PEZA) Officer-in-Charge Tereso O. Panga remains positive that the ecozone industry can be a key contributor to the country’s economic growth this year as the new administration marked its first 100 days in office.

“We in PEZA assure the new administration under the President Bongbong Marcos Jr. and guided by the Department of Trade and Industry’s (DTI) industrialization strategy that we can attract more investments for this last quarter of the year given the positive growth rate forecast of the ecozone semiconductor-electronics and IT sectors, the aggressive investment promotions by the President, and upcoming missions to Taiwan, South Korea, and Japan. Now is the best time to invest as incentives had been boosted along with top-level political support to ecozones,” noted Panga.

In the first State of the Nation Address of PBBM in July, he highlighted at the beginning that “Ecozones will be fully supported to bring in strategic industries such as those engaged in high-tech manufacturing, health and medical care, and all emerging technologies. This is also seen to facilitate economic growth outside of Metro Manila.”

Anent to this, Panga showcased that PEZA posted a total of Php 39.631 Billion approved investments from 148 new and expansion projects for the January to September 2022 period.

Meanwhile, for the January to August 2022, PEZA also generated a total of US$43.166 Billion exports and created 1,798,152 direct jobs, which are 6.07% and 6.52% increase respectively as compared to the same period last year.

 

Q3 2022 Performance

Specifically for July to September, the PEZA Board has approved a total of 58 new and expansion projects expected to bring in PhP 17.142 Billion worth of investments, US$ 877.807 Million of exports and create 13,904 jobs.

Among the approved new and expansion projects, 21 will be for export, 19 for IT, seven (7) for facilities, and three (3) for tourism.

In addition, eight (8) ecozone development projects were approved to boost the Authority’s countryside development strategy—four (4) manufacturing ecozones in Cavite, Batangas, Bulacan, and Pampanga; two (2) IT parks in Iloilo and Davao; and two (2) agro-industrial zones in Iloilo.

 

Strategic and big-ticket investments

PEZA was also able to register and approve strategic investments in the country.

For the January to September 2022 period, PEZA has closed 20 big-ticket projects (with minimum P1 Billion capital per project) that are expected to bring PhP 24.758 Billion worth of investments, USD$ 654.338 Million of exports, and 9,649 direct jobs.

These investments will be into Manufacturing of various products including SMS/EMS, Accommodation, Real Estate Activities, Office Administrative, Business Support activities among others.

Some of the companies registering in PEZA big-ticket investments include Cebu Mitsumi, Inc., Robinsons Land Corp., and TDK Philippines Corp.

 

Boosting exports to accelerate the country’s economic growth

In terms of exports, PEZA’s ecozone exports account for the biggest share in the country’s total annual exports for the first half of the year.

Based on the Philexport report about the country’s total exports of goods and services, “Exports of goods in the first half of 2022 rose 7.9 percent to $28.26 billion from $26.19 billion a year ago. Exports of services grew faster at 13.5 percent to $17.79 billion from $15.67 billion.”

For the last 4 years (H1 2019-2022), ecozone exports accounted for average 66.77% of the country’s total exports, 77.46% of the total PH goods exports, and 52.23% of the services exports.

There is a 7.7% increase of total PEZA Ecozone Exports while the Philippine Exports is 10% higher for the period of Jan-Jun 2021 vs 2022.

Panga noted, “We remain bullish that we will be able to achieve our 6-7% investments target for the year taking into consideration the firm growth forecasts for 2022 of our winner ecozone sectors at 10- 15% for IBPAP and 10% for SEIPI. These bright outlooks are aligned with the calibrated year end GDP growth for the Philippines at 6.5%- 7.5%, which makes the country among the fastest growing economies in the region.”

 

Strengthening the ecozone program

In earnest efforts to contribute in the PBBM administration’s socio-economic agenda, Panga stated that PEZA is taking advantage of the new and amended laws to boost competitiveness in the market, and facilitate the growth of investments in the country

At the same time, PEZA is looking into new frontiers in ecozone development to cater to unique, strategic, and big-ticket investments coming into the Philippines. These new types of ecozones include, among others, the Knowledge, Innovation, Science and Technology Parks, Mineral Processing ecozone, Renewable Energy Hubs, Aquamarine Ecozones, Halal Hubs, Bio-tech Centers, Defense Industrial Complexes, and Pharmaceutical Parks.

“Guided by the new DTI strategic priorities, PEZA is eyeing to attract high-tech industries and emerging technologies in the fields of industrial manufacturing transport, technology media and telecommunications, health and life sciences including mineral processing of green metals,” said the PEZA interim chief.

 

WFH as a Business Flexibility Measure

With regard to the work-from-home (WFH), PEZA and the IT sector are eagerly awaiting the Board of Investments’ (BOI) guidelines allowing for the registration of 100% WFH activity by IT locators operating in their respective IT centers.

The said guidelines will complement the Fiscal Incentive Review Board’s (FIRB) resolution and the Department of Labor and Employment’s (DOLE) guidelines on the conduct of WFH and hybrid work arrangement.

“As long as we are kept whole with PEZA’s exercise of its regulatory powers, investment facilitation and income-generating functions—together with the IT locators’ enjoyment of flexi-work with incentives regardless of location—we are all for it. We will support any initiative of government to preserve the competitiveness of the IT locators which we have grown into a vibrant economic sector over the years,” assured Panga.

Earlier, PEZA expressed its preference for a law, as espoused by some legislators, that will institutionalize the hybrid workplace especially for IT locator companies to put them on an equal footing with the BOI RBEs.

“With the interim ‘paper transfer’ arrangement, we hope that it will allow as well for a re-registration mechanism for transferee RBEs in the IT Centers that may want to restore their PEZA status once the enabling law is in place," he added.

The PEZA OIC stated, “PEZA’s ease of doing business through its one-stop shop facility and business ecosystem have been cited by the IFC World Bank, the US Department of State and the UNCTAD Annual Investment Report. We will remain true to our mandate of promoting investments, generating exports, and creating jobs to contribute to the overall growth and development of the country today and in the years to come.” #