Delays in ecozone proclamations further hurting PEZA performance
The prolonged delays in the proclamation of new economic zones are further hurting the output of the country’s biggest investment promotion agency, which is already reeling from uncertainties caused by the proposed rationalization of fiscal incentives under the second tax reform package.
Philippine Economic Zone Authority (PEZA) manager for promotion and public relations Elmer San Pascual said presidential proclamations of economic zone applications have remained few and slow compared to those in the past.
“Although they are coming out with proclamations, it is not as predictable as before wherein it is sure to be proclaimed after three months. They approved about four or six in January and another two or three last February,” San Pascual said.
“So that predictability is something we don’t have now and that is also causing some hesitations,” he added.
With investor concerns from the second tax reform package cited as factors, PEZA’s approved investment pledges declined 22 percent in the first two months of the year to P20.99 billion from P26.81 billion in the same period of 2017.
San Pascual said aside from information technology and manufacturing, pledges for economic zone development, which buoyed PEZA’s total investment figures last year, have also slowed.
“How can you have economic zone development if the proclamation is slow?” San Pascual said.
PEZA director general Charito Plaza last year raised concern over the delays on the proclamation of new economic zones that have resulted in applications piling up at the Office of the President.
As of end-2017, some P72.4billion worth of economic zone development projects have remained unapproved.
Of the 42 pending economic zones application as of end last year, 37 came under the current administration, while five were from the previous administration. “It’s just the first year in office of President Duterte so he has new people in the Palace. So we try to understand the reasons. One is they have new people in the Palace who are still learning the processes and then the Palace also has new requirements,” Plaza earlier said when asked about the cause of the delays.