Investment pledges fall 23% to 1107 billion
In January-February
Investment pledges approved by the Board of Investments fell 22.71 percent in the first two months of the year as number of committed projects dropped by a hefty 42 percent, but the agency sees a strong rebound in March with the registration of pipeline projects.
The BOI, the government’s premier investment promotion agency, reported that total committed projects approved in the January-February period this year reached only 1101.72 billion as against 1131.61 billion in the same period of 2018. The agency was able to register only 4,648 projects as against 8,052 approved in the first two months of 2018.
Investment pledges saw a steep decline despite strong growth from foreign investors. Committed foreign investments reached 110.926 billion, a substantial 1,456 percent growth from 1702.28 million in the same period last year. Dutch investors were the biggest by nationality with 16.848 billion worth of investments followed by Italy (1250.74 million), Japan (1202.14 million), and South Korea (1102.42 million).
In contrast, investment pledges by local businessmen declined by 30.645 percent to 190.791 billion from 1130.908 billion in the January-February period last year.
“It is just a matter of timing,” said Trade and Industry Secretary Ramon M. Lopez, who is also BOI chairman, on the decline in investment pledges in the first two months of the year.
Lopez expressed confidence of a strong rebound in investment commitments in March that would bring first quarter growth to over 50 percent.
“Some projects are going to be considered in March meetings. Thus, expecting March to show high growth again,” added Lopez.
Trade Undersecretary and BOI Managing Head Ceferino Rodolfo also explained that key projects in the pipeline, particular in area of power, are still undergoing rigorous evaluation process on technical and financial aspects, which are equally important in their compliance with requirements for BOI registration.
“Given the projected investment costs, we are very optimistic of a renewed surge in total approvals in the next months,” Rodolfo said.
In terms of sectors, power projects registered the biggest investment with 149.42 billion followed by information and communication with 133.14 billion, and manufacturing with 112.93 billion. The real estate sector or mass housing projects contributed 12.15 billion, and human health/hospitals 11.82 billion.
Regions IVA topped the list as favorite investment destination with total approvals worth 160.934 billion, followed by Region VII with 12.008 billion), and Region VIII (1970 million). Region III contributed 1836.62 million, and Region VI with 1824.82 million.
The top five regions generated a total of 165.57 billion worth of approved committed investments or a 65 percent share of total.
The approved big ticket projects include Rizal Wind Energy Corp. (147.356 billion), Metroworks ICT Construction, Inc. (133.14 billion), Solid Cement Corp. (112.451 billion), and Allied Care Experts Medical Center (1970 million).
“We remain optimistic of meeting the 11 trillion target set by our Chairman, DTI Secretary Ramon Lopez, for BOI this year. It is a timing issue as we cannot and we do not rush project approvals. The BOI makes sure that every peso of approved investments is qualified and is deserving to be registered,” said Rodolfo.