The Philippines is said to have lost as much as P25 billion worth of investments in expansion projects last year, as the congestion problems at the Port of Manila may have dissuaded existing investors from pursuing these plans until the situation has been resolved.
Elmer H. San Pascual, group manager of the promotions and public relations group of Peza, noted that the amount did not even include the new investments that could have entered the country in 2014 had it not been for the port congestion.
About half of that P25 billion, however, could still be wooed back if the Philippines could show that it could cope with the additional cargo volumes expected during the peak season, San Pascual said.
“These investors tell us that they still have confidence in Peza, that they don’t have any problems with Peza. However, many of the expansion projects are currently on hold. The [local companies] must be able to build the confidence of their parent firms. But if they are not earning revenues, how can these companies justify their expansion plans in the Philippines?” according to San Pascual.
“Many of these investors know that the port operations have already normalized, and that the Manila port is already doing well. But they want to see that this situation will continue for a long time, and that we [see] the same problems of last year,” he said, adding that it would be up to the Peza locators to convince their head offices to expand in the Philippines.
The locators at Peza, San Pascual said, were hit hard by the port congestion in the third quarter of last year, which reflected in the agency’s total investment approvals for 2014. The total value of investment pledges approved by Peza last year inched up by only 1.2 percent to P279.48 billion, from the P276.13 billion worth of projects approved in 2013.
This year, Peza director general Lilia B. de Lima said, the agency expects investment approvals to grow by 8 percent. Exports and employment generation within Peza ecozones are also expected to grow by 10 percent this year.
Trade Secretary Gregory L. Domingo on Thursday assured investors that the Philippine government and the private sector have already put in place the necessary measures to allow the port of Manila to cope better with higher cargo volumes.
“We have learned a lot from what happened last year, so our throughput this year, in terms of capacity, should be higher and therefore we’d be able to cope with this issue better,” Domingo said. “It will take a higher level of congestion for us to suffer the same fate as last year.”