Subic investments seen to hit $3 billion

MANILA, Philippines - Investments in the Subic Freeport Zone is expected to soar dramatically this year as $3 billion worth of investment commitment is expected to be secured by the Freeport.

In an interview, Subic Bay Metropolitan Authority (SBMA) Administrator Armand C. Arreza said he expects $3 billion worth of investments this year after posting a dismal $190-million investments in 2009.

Two projects worth $1 billion each are expected this year. These are the M Castle development of a Korean firm in Morong Bataan and the development of the airport in Subic.

The master plan for the airport is being readied by a Bahrain firm. The 200-hectare lot will be re-developed with some portions dedicated for mixed use.

“The master plan will be completed by September and we expect to receive unsolicited proposals by October,” Arreza said. Because a new terminal and a new aviation concept is expected to be developed, Arreza said the investment for this project alone will easily reach $1 billion.

The M Castle meanwhile is worth $1 billion which will be spread over a 10-year period. Arreza described the investment as a resort development. It will be located in a 560-hectare land.

Another investment is the privatization of the New Container terminal 2 (NCT 2). The contract is worth almost P5 billion and is divided in three phases.

For the first six months of the year, investment more than doubled as it amounted to $185.9 million.

This represents a 101.67-percent increase when compared to the $92.18 million recorded during the same period a year ago.

 “Considering that we’re still on the tail end of the global recession, it’s quite remarkable that Subic would be hitting more than $37 million per month in terms of new investments,” Arreza said.

“Last year, our monthly investments average in the first half was only about $17 million due to the financial slowdown that affected trade in Subic,” he said.

According to Arreza, a total of 56 new projects were approved by the agency in the first half, compared to 51 in the same period last year.

Of the new projects, foreign direct investments totaled $114.58 million or an increase of 98.28 percent over last year’s $57.78 million.

Local investments, meanwhile, reached a total of $71.29 million, a 140- percent increase over last year’s $29.67 million in the first half.

Arreza said that once operational, the new investment projects are expected to create some 6,725 new jobs.

Arreza also noted the growing participation of local companies in the economic development of the Subic Freeport, as the global recession somewhat curtailed the entry of foreign investments.