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Foreign investment pledges in 7 agencies triple in Q1.

AMID the ongoing trade tensions between the US and China, as well as government efforts to rationalize incentives, foreign investment (FI) approvals in Investment Promotion Agencies (IPAs) tripled in the first quarter of 2019, according to the Philippine Statistics Authority (PSA).

In the latest PSA report, foreign investment pledges with the seven IPAs grew 233.6 percent to P45.98 billion from only P14.21 billion in the same period last year.

The data was obtained from the seven IPAs-Board of Investments (BOI), Clark Development Corp. (CDC), Philippine Economic Zone Authority (Peza) and Subic Bay Metropolitan Authority (SBMA), as well as the Authority of the Freeport Area of Bataan (Afab), BOI-Autonomous Region in Muslim Mindanao (BOI-ARMM) and Cagayan Economic Zone Authority (Ceza).

The data showed that the highest foreign investment approvals came from the BOI, growing over 1,000 percent to P30.82 billion in the first quarter of the year from P792.8 million in 2018. Approvals from the BOI accounted for 67 percent of foreign investment pledges in the first quarter this year.

This was followed by approvals made by the Peza, which grew only 0.1 percent to P12.97 billion in the first quarter of the year from P12.96 billion in the same period in 2018. Approvals from Peza accounted for 28.2 percent of the total during the period.

Most of the approved foreign investments came from the Netherlands and Japan, which accounted for 22 percent and 20.5 percent, respectively, of total foreign investment approvals in the first quarter.

Approved investments from the Netherlands grew over 1,000 percent to P10.097 billion in the first quarter in 2019 from only P878.5 million in the same period last year, while approvals of investments from Japan grew 19.9 percent to P9.43 billion this year from P7.86 billion in 2018.

Following the Netherlands and Japan was Thailand, which accounted for 18.4 percent of total approved foreign investments during the period and reached P8.5 billion in 2019. There were no approved investments from Thailand in the first quarter of last year.

By sector, location

Meanwhile, in terms of sector, manufacturing accounted for 76.1 percent of the total FI pledges or P35 billion. Administrative and Support Service Activities came in second with investment commitments valued at P3.5 billion or 7.7 percent of the total, followed by Accommodation and Food Service Activities with P2.9 billion or a share of 6.4 percent.

In terms of location, majority of the approved foreign investments in the first quarter of 2019 were intended to finance projects in Central Luzon amounting to P22.1 billion or 48.1 percent.

This was followed by Region 4A -Calabarzon with P15.7 billion or 34.1 percent and National Capital Region with P6.3 billion or 13.7 percent.

Meanwhile, approved investments of foreign and Filipino nationals in the first quarter of 2019 grew by 48.1 percent to P274.2 billion from P185.1 billion investment pledges in the same period a year ago.

Filipino nationals shared P228.2 billion worth of investment pledges or 83.2 percent of the total approved investments during the quarter.

Foreign and Filipino projects approved by the seven IPAs in the first quarter of 2019 are expected to generate 41,837 jobs. This is 24 percent higher than the previous year's projected employment.

However, out of these anticipated jobs, 76.4 percent or 31,979 jobs would come from projects with foreign interest.
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Publication:Business Mirror (Makati City, Philippines)
Date:Jun 7, 2019
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