Volume 27 No. 10 October 2016 BOI-registered investments grow two-fold The Board of Investments (BOI) approved 192 projects worth P210.37B BOI investment approvals in the first seven months of the year, January-July 2015 - January-July 2016 which is 98% better than the P106.08B recorded in the same period last year. P210.37B P The projects, once fully operational, P will generate 37,487 jobs. P106.08B P The nearly two-fold increase in performance P 98% is attributed mainly to the big-ticket energy and infrastructure projects approved 192 37,487 for the period. Energy projects, which July 2015 July 2016 projects jobs increased by 325%, accounted for 51% of total BOI approvals. “Dispersion of investments in the “Confidence in the new administration is BOI Big-Ticket Projects (January-July 2016) In Billion Pesos regions had also changed. NCR strong, while our economic fundamentals usually receives the highest amount and consumer confidence are high,” he said. Limay Premiere Power Corp. 23.30 of investments, but now, investments GMR Megawide Cebu Airport Corp. 16.75 are dispersed as other regions take the “We have a better business environment Bayog Wind Power Corp. 14.73 lead in attracting more investments,” under the new administration. President Cordillera Hydroelectric said Ceferino, who also serves as BOI Duterte’s 10-point economic agenda is Power Corp. 12.19 Managing Head. a big factor to attracting investments. Part of this agenda pursues the stability For the month of July, major approvals DTI Secretary and BOI Chairman Ramon M. of the policy environment, honoring included the P11.64-M El Elyon Power Lopez said the agency expects approved contracts and not changing the rules Plan Phils. Inc. project with a generating investment pledges to further grow on the midway, a big come-on for many capacity of 160MW in Sarangani Province, back of sound economic fundamentals and investors,” he added. and the P8.38-M Luzon Clean Water sustained investor confidence. Development Corp. project, a public- The current investment incentives private partnership (PPP) project for the “While confidence in the economy regime outlined in the Investment Bulacan Bulk Water Supply Project (Stages remains with investments continuing Priorities Plan (IPP), according 1 and 2) under the concession agreement to pour in, the government is pursuing to Lopez, will be modernized by with the Metropolitan Waterworks and a number of strategic investment proposing amendments to the 1987 Sewerage System (MWSS). policy and promotion initiatives in a Omnibus Investments Code. bid to further strengthen its efforts in Top destinations of BOI-approved attracting a massive flow of domestic “In granting incentives, we will projects for the first seven months of the and foreign investments in the country focus on creating decent jobs in the year were the National Capital Region particularly those that would bring in Philippines. As such, bias against (NCR) with P37.05B, Region 3 with new technology,” said Lopez. foreign investors and bias against P44.32B, and Region 4A with P28.69B. those serving the domestic market will The government will synchronize the be removed. Further, if the economic “Investments coming in are in investment promotion efforts of all provisions of the Constitution will be sectors that will elevate our its investment promotion agencies amended, greater foreign equity in competitiveness such as in power (IPAs) to support Philippine branding sectors that are crucial to improving and infrastructure,” Department and focus on promoting strategic the competitiveness of industries such of Trade and Industry-Industry investments to position the country as as infrastructure and utilities like Development Group (DTI-IDG) a world class investments destination, telecommunications, roads, ports, and Undersecretary Ceferino S. Rodolfo said. he said. airports, may be allowed,” Lopez said. October 2016 1 BOI Top 5 Sources of Foreign Investments IB is a model that allows companies This program is in line with the Jan-July 2016 to engage poor and low-income “administration’s strategy to move (in billion pesos) communities as partners, customers, into the medium to long term Country Amount suppliers, and employees in their recovery and rehabilitation of areas Singapore 9.83 supply chains. highly affected by calamities.” Netherlands 7.12 South Korea 6.42 The IPP will also have a provision DTI hopes to come up with the first Japan 5.69 on least developed areas (LDAs) to draft of the amended IPP before the British Virgin Islands 2.02 boost economic activities in the rural end of the year. areas and decentralize growth from To support the development the major urban centers like Metro PHL economy grew 7% in Q2 of micro, small, and medium Manila. The Philippine gross domestic enterprises (MSMEs), the DTI is product (GDP) grew by 7% during the studying the possibility of linking the Based on Memorandum Circular (MC) second quarter of the year, faster Philippine Economic Zone Authority No. 2016-003, “registered projects than the 5.9% posted a quarter ago (PEZA) and other ecozone locators located in identified LDAs shall be and the 6.8% in the first quarter of with the domestic MSMEs as suppliers entitled to pioneer incentives and last year, according to the Philippine of raw materials, intermediate additional deduction from taxable Statistics Authority (PSA). parts, and components. income equivalent to 100 percent of expenses incurred in the development This brings the country’s average of necessary and major infrastructure GDP growth in the first half to 6.9%, INDUSTRY facilities unless otherwise specified in National Statistician Lisa Grace S. TRENDS the IPP’s specific guidelines.” Bersales said. An LDA, according to the MC, is The faster growth in the second IPP review underway determined based on several criteria quarter was attributed to election- The Board of Investments (BOI) has including low per capital gross domestic related spending coupled with started the review of the country’s product, low level of investments, sustained robust domestic demand Investment Priorities Plan (IPP) high rate of unemployment and/or that bolstered manufacturing. to trim the number of projects underemployment, and low level of entitled to government incentives, infrastructure development including Business groups expect this strong Department of Trade and Industry its accessibility to the urban centers. performance to be sustained until (DTI) Secretary Ramon M. Lopez said. year-end. Below are some of their Under the IPP, BOI has identified projections for the economy for the The review covers all industries, 134 LDA calamity-stricken cities rest of the year: activities, and projects identified in and municipalities located in 14 l “Strong growth to be sustained the current IPP. provinces. with increased government infrastructure spending, “We’re working first on the basic BOI-identified clamity-stricken LDAs private sector construction, framework. There is already an (Number of cities and municipalities per province) consumer spending and foreign ongoing review on how we can direct investment inflows, and Leyte 28 modernize the incentive system. the continued growth of the Iloilo 27 There are consultations being done business process outsourcing Capiz 17 now before we really craft the next Aklan 14 sector.” —Management batch of IPP,” Lopez said. Cebu 14 Association of the Philippines Antique 11 President Perry L. Pe The IPP is a list of activities entitled Negros Occidental 7 l “. potential to grow even to government incentives. Preferred Eastern Samar 4 faster than 7% when the activities under the existing list Palawan 4 economy runs on all cylinders, include manufacturing, agribusiness Western Samar 4 including good infrastructure, and fishery, services, economic and Biliran 1 agriculture, and responsible low-cost housing, hospitals, energy, Dinagat Islands 1 mining.” —American public infrastructure, logistics, and Masbate 1 Chamber of Commerce of the public-private partnership (PPP) Southern Leyte 1 Philippines Senior Adviser projects. John D. Forbes Any facility, project, and activity l “The fourth quarter may see a Among the activities that will be brought to these specific low-income GDP growth that may even be incentivized are Philippine firms and disaster-stricken areas would higher than 7%.” —Philippine which would incorporate the be given incentives, including tax Exporters Confederation, Inc. inclusive business (IB) model into deductions to boost economic (Philexport) President Sergio R. their operations. activities there. Ortiz-Luis Jr. 2 Philippine Business Report l “A healthy Philippine economy The government will also look for other as participants of the Comprehensive can be achieved, not only for players who are interested to invest in Automotive Resurgence Strategy a short term but for the long the telecommunications business. (CARS) program. haul.” —Makati Business Club Executive Director Perter The DICT plans to put up free Wi-Fi Toyota and Mitsubishi will be putting Angelo V. Perfecto services in all public places in towns in a total of P7.5B to produce their and cities across the country. respective enrolled models, the full- The Duterte administration targets model Vios and the Mirage/Mirage the country’s GDP to grow by 6%-7% DTI directs investments to agri- G4, respectively. Of the amount to by the end of 2016. based sector, marginalized areas be invested, 20% or P1.6B, will come The Department of Trade and Industry from local parts suppliers. ICT ‘fast