BOI approvals down 52% in 1st qtr

MANILA, Philippines - Investment pledges approved by the Board of Investments (BOI) declined 52 percent in the first quarter from a year ago.

In a statement, the BOI said it approved P46.77 billion worth of investments as of end-March, down from the P97.19 billion approved in the comparable period last year.

BOI managing head Adrian Cristobal Jr. said last year’s figure was higher due to the big ticket power project of Redondo Peninsula Energy Inc. amounting to P62.86 billion approved in 2013.

Cristobal said that domestic firms dominated the total investment commitments for the first quarter at 90 percent or P42.08 billion.

The balance of 10 percent or P4.69 billion came from foreign sources.

Topping the list of foreign country sources of investments is the United Kingdom with a 31-percent share amounting to P1.46 billion.

Japan came in second with P874.78 million worth of investments (19-percent share), followed by the Netherlands which contributed P492.50 million (10-percent share).

Thailand and Taiwan got the fourth and fifth spots, pouring in investments worth P237.28 million (five-percent share) and P16.08 million (0.34 percent share), respectively.

The biggest projects approved for the quarter are those made by the following companies: Citicore Megawide Consortium, Inc (P8.5 billion), SM Development Corp. (P5.9 billion), Prime Meridian Powergen Corp. (P5.57 billion), Cebu Air Inc. (P3.9 billion) Agusan Power Corp. (P3.66 billion), and Bright Future Educational Facilities Inc. (P2.5 billion).

By sector, real estate activities, specifically, the mass housing sub-sector recorded the largest share of investment commitments at P17.96 billion or 38 percent share.

The construction sector came in second with P11.05 billion or 24 percent share; followed by electricity, gas, steam and air conditioning supply sector (e.g., power generating plants, renewable energy projects) with P10.55 billion or 23 percent share; transportation and storage with P4.47 billion or 10 percent  share; and manufacturing sector with P2.09 billion or four percent.

In terms of regions, the National Capital Region (NCR) generated the most investments with P19.86 billion or 42.5 percent share.

The BOI-approved projects for the first three months of the year are expected to generate 11,636 jobs, much higher compared to the 7,239 jobs in the same period in 2013.

Cristobal said the significant increase in job generation is a result of the substantial investments in the manufacturing sector which grew 168 percent from the same period last year.

 â€œThe steady progress of the government’s policy reform program and industry development initiatives provide a favorable environment for meaningful investments in sectors that directly impact on increasing employment opportunities,” he said.

In January 2012, the Department of Trade and Industry launched the Industry Development Program which involves private sector groups crafting sectoral road maps that would contain their goals and strategies as well as the required interventions from government to achieve short, medium, and long term growth.

 â€œThe industry roadmap project reflects the actual needs of industry as seen through the more than 27 industry roadmaps completed last year. These include investment gaps and more importantly, the need to revive the manufacturing industry, with its high impact on jobs generation,” Cristobal said.