Total approved investments by the Philippine Board of Investments (BOI) remain steadily upward with Php304.4 billion in the first half of 2019, an improvement of 27.4 percent compared to the same period last year.
Approved foreign investments hit Php68.9 billion in the same period, a 375.3 percent jump from January to June 2018. Domestic investments continued to roll with Php235.6 billion in the first half, posting a 5 percent growth vis-à-vis the first six (6) months of last year.
Singapore retains its position as the country’s largest foreign investor with Php35.4 billion. Netherlands is second with Php9.2 billion, with Thailand occupying third with Php8.5 billion. Japan (Php5.8 billion) and the United States (Php2.4 billion) round up the five biggest foreign investors.
“Our economy remains strong, and we remain all the more optimistic as the budget impasse has been resolved. All indicators point to the economy accelerating in the second quarter to around 6 percent due to robust domestic consumption. Our business confidence remains the most bullish among ASEAN countries and even topped all 34 economies surveyed by Grant Thornton’s International Business Report this year,” Trade Secretary and BOI Chairman Ramon M. Lopez said.
Our GDP growth remains among the fastest not only in ASEAN but the whole of Asia and its momentum is strong enough to cushion the impact of the China-U.S. trade tensions. “Although there is now a truce between them, we are ready to “catch and absorb” investments that will be redirected from China and other countries that will bear the brunt should talks break down again. We remain hopeful they will strike a deal because the global economy is at stake. Both countries are among our largest trading partners but for any eventuality, we have to diversify our markets by going beyond the traditional ones while further strengthening our domestic base,” he explained.
Power projects in the first half cornered the lion’s share of the total investments with Php192.4 billion, a 77.9 percent hike from last year’s Php108.2 billion. The resurgence of the manufacturing sector continues with Php45.3 billion to date, a 128.4 percent increase from Php19.8 billion in January to June 2018. The information and communication sector posted a 9,680 percent upsurge to Php33.2 billion from just Php340 million last year. Tourism accommodation steamrolled to Php8.6 billion, up 591 percent from Php1.2 billion last year.
“Year-on-year, investments are still increasing. We are confident of surpassing our target at the end of the year. There are big ticket projects in the pipeline, but we are exercising – as we do in all cases – prudence in diligently assessing their eligibility for incentives,” Trade Undersecretary Ceferino S. Rodolfo said.
Countryside development continues to be in full swing with 96 percent of investments spread to other regions other than the National Capital Region (NCR). Region IVA - Calabarzon continues to be the number one investment location with Php201.2 billion and followed by Region III- Central Luzon (Php27.7 billion). NCR placed third (Php11.3 billion), accounting for just 4 percent of the total figure. The rest of the top five are Region VII – Cagayan Valley (Php8.7 billion) and Region VII – Central Visayas (Php7.7 billion).
Rodolfo said among the latest approvals are the Php4 billion 19.7 megawatt (MW) hydropower project of Rio Norte Hydropower Corp. in Isabela, the Php4.7 billion acquisition of the newest models of Airbus planes by Cebu Air., Inc. and the Php2.3 billion 15 MW thermal power plant of DMCI Masbate Power Corp. in Masbate.
Another notable project is the Php47 million export production of coconut products by Aseniero International Trading (AIT) in Zamboanga del Norte. It involves the production of coconut sugar (324,000 kilos per year), coconut syrup (246,240 kilos a year) and coconut vinegar (2,887,120 liters annually), of which a sizable majority is geared towards export markets like the U.S., Germany, Taiwan and Sweden. With commercial operations slated for July 2019, this is expected to generate 530 jobs and export earnings of over US$3 million yearly. This is also aligned with the intent of the industry and government to add more value to traditional coconut export products such as crude coconut oil, copra and desiccated coconut.
Relatedly, the BOI recently awarded Certificates of Registration (CoR) to agribusiness projects that serve both domestic and export markets such as: the Php3.6 billion modern plant of Zenith Foods Corp. in Calamba, Laguna; the Php291.6 million organic rice production facility of Northern Calamian Farming Inc. in Coron, Palawan; and the Php28 million broiler chicken production plant of Safi Poultry Corp. in South Cotabato.
Read more: Department of Trade and Industry website
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