Total investment pledges approved by the Board of Investments (BOI) and Philippine Economic Zone Authority (Peza) dipped by 1.2 percent to P393.6 billion in the first eight months of 2014 from the P398.3 billion recorded a year ago.
Trade Undersecretary Adrian S. Cristobal Jr. said the decline was due to the lack of big-ticket projects seen in the same period last year. The country was also coming from a higher base, with investment approvals in 2013 growing by 10.4 percent to P742.2 billion from the P672.3 billion in 2012.
But Cristobal pointed to the upside of the investment figures, citing the number of jobs that the potential projects could generate.
Based on documents provided during the Philippine Economic Briefing Tuesday, the approved investment commitments for the January-August 2014 period covered 541 projects, which could generate 107,639 new jobs.
The bulk of these pledges (41 percent, or P162 billion) were intended to fund electricity, gas, steam and air-conditioning supply projects. Some of the major power projects approved included those of St. Raphael Power Generation Corp.; GNPower Kauswagan Ltd. Co.; Panay Energy Development Corp.; Emerging Power Inc.; Prime Meridian Powergen Corp.; and Agusan Power Corp.
Real estate activities comprised the second biggest share (25 percent) with P98 billion, followed by manufacturing projects, which could boost the country’s industrial sector. Other projects are related to construction, accommodation, and food services activities.
Of the investment commitments approved, about P328 billion (83 percent) came from domestic sources, while the remaining P66 billion (17 percent) came from foreign sources.
The top five foreign sources of investments were Japan, with approved investments reaching P13.6 billion; the Cayman Islands (P10 billion); The Netherlands (P9 billion); British Virgin Islands (5.9 billion); and the United States (P5.7 billion). They were followed by Germany, Singapore, the United Kingdom, South Korea and Australia.
This year, the BOI and Peza expect the value of investment approvals to reach a combined P790 billion; P869.3 billion in 2015; and P956.3 billion in 2016.
The BOI alone is looking at investment approvals amounting to P491 billion in 2014; P540 billion in 2015; and P594 billion in 2016. For Peza, investment approvals are targeted to reach P299 billion in 2014; P329 billion in 2015; P362 billion in 2016.
According to government documents, the investment target of BOI was based on 10 percent per year growth rate under the Philippine Development Plan. Peza’s target, meanwhile, was based on the agency’s performance in previous years, after taking into account the factors that influenced the global market.
These included movement of electronics products and devices in the world market; the movement and growth of the global automotive industry; and the concomitant upgrading of electronic and electrical machinery to produce upgraded products.