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Philippines: Ecozone investments down 69% in January
MANILA, Philippines — Investments approved by the Philippine Economic Zone Authority (PEZA) fell by 69 percent in January from a year ago amid challenges from the ongoing pandemic.
“For the month of January 2022, the PEZA board approved nine new and expansion projects with P3.48 billion of investments,” PEZA said in a statement yesterday.
In the same month last year, PEZA-approved investments reached P11.31 billion.
PEZA said the approved investments are estimated to bring annual export sales of $56.09 million and generate 732 direct jobs.
Last year, the total investments approved by the agency reached P69.30 billion, down 27 percent from P95.03 billion in 2020.
PEZA director general Charito Plaza attributed the decline in investments to the effects of the pandemic, particularly with the spread of the Delta and Omicron variants, and the impact of Typhoon Odette in the Visayas and Mindanao last December.
PEZA deputy director general Tereso Panga said the decline is being felt not just in the Philippines, but also on a global scale.
“As cited by World Bank, the global economic slowdown is projected to last until 2023 due to the continuous challenges and effects of new COVID variants and supply-chain bottlenecks especially in developing countries,” he said.
He also said concerns of ecozone investors on some provisions of the Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act on tax incentives, as well as slow proclamation process for ecozones, moratorium on information technology center development in the National Capital Region, and the late promulgation of the Strategic Investment Priority Plan (SIPP) affected investment plans.
Under the CREATE, the SIPP will identify investment projects and economic activities entitled to incentives from the government.
The Board of Investments is set to hold a public consultation on the proposed SIPP today.
On the positive side, Plaza said the country’s 415 ecozones are increasing and the locators are not stopping their operations, hence the increase in export income and employment.
Last year, exports from ecozones reached $63.06 billion, 14 percent higher than the $55.31 billion in 2020.
Employment in ecozones also rose to 1.78 million last year from 1.5 million in 2020.
“Our investors continue to give their trust and confidence to PEZA for providing them business assistance, reliefs and COVID related-expenses which are deductibles to their income taxes,” Plaza said.
For this year, PEZA is aiming for a a six percent growth in approved investments.
Source: https://www.philstar.com/business/2022/02/18/2161497/ecozone-investments-down-69-january