BoI, PEZA investment approvals up 52% in Q1

INVESTMENTS approved by the Board of Investments ( BoI) and the Philippine Economic Zone Authority (PEZA) increased by

Data on the Department of Trade and Industry’s ( DTI) website showed that BoI- approved investments rose by 123 percent from P152.12 billion this year

PEZA- approved investments fell by 40.2 percent to P30.72 billion from P51.34 billion last year.

Investments in electricity, gas, steam, and airconditioning supply had the biggest share, soaring more than 2,000 percent to P104.35 billion from P4.8 billion in 2017.

Those in real estate posted P27.24 billion; manufacturing, P23.85 billion; water supply, sewerage, and waste management, P13.87 billion; and transportation and storage, P7.01 billion.

Japan had the biggest number of approved foreign investments, amounting to P7.86 billion. The United Kingdom followed with P1.54 billion, the Netherland with P880 million, Singapore with P560 million, and the United States with P450 million.

Others investments came from China, Taiwan, South Korea, Australia, and Germany.

Uncertainties caused by the second package of the Tax Reform for Acceleration and Inclusion ( Train) Act caused the drop in the investments her agency approved, PEZA Director Charito Plaza said.

“[ N] ew investors are afraid to invest [ while there are] unstable laws and policies [ in] the country, and industries are [ very] capital- intensive and create thousands of jobs,” Plaza said.

She noted that, despite the decline, “no existing industry closed or got out.”

The government is currently rationalizing tax incentives as part of the second package, which seeks to lower corporate income tax, but on the condition that tax incentives would be reduced.

Under that package, the government eyes limiting PEZA incentives to a maximum of 10 years, and change the 5 percent tax on gross income earned ( GIE) to a 15 percent tax on net income.

It also seeks to repeal more than 30 special laws that grant incentives to investors, and for PEZA- registered enterprises to

from the current 70 percent.

Plaza earlier expressed concern over the package, saying this would result in lower PEZA investments.

“[Unless] our government can assure and stabilize our laws and policies, new investors will prefer to invest in other countries with stable and attractive incentives,” she said.