Investment pledges seen rising 38% in Jan-July

MANILA, Philippines - Investment pledges are expected to surpass the earlier target of 38 percent year-on-year growth in the first seven months with new projects added into the pipeline following the recent approval of the implementing guidelines for the 2017-2019 Investment Priorities Plan (IPP).

BOI managing head Ceferino Rodolfo said the new additions include a P400-million new sugar mill project, a maiden inclusive business (IB) project and several hotel projects.

“For the first time, we will have an investment in a brand new sugar mill because the others are just retrofitted,” Rodolfo said.

“We also have one on inclusive business because as you know, this has been opened in the IPP,” he said.

Under the IPP, IB projects in the agribusiness and tourism sectors may qualify for investment incentives such as pioneer status and eligibility for income tax holiday of five years, subject to the provisions of Executive Order 226 or the Omnibus Investments Code.

A qualified agribusiness and tourism project may opt to undertake IB models by submitting a duly notarized IB plan upon application for registration, which includes targets and timetable based on specific qualifications and conditions.  

IBs are innovative models where companies engage the poor and low-income communities as partners, customers, suppliers, and employees in their supply chains not out of charity, but “because it makes good business sense.”

The BOI adopted such innovative business model or approach for investment projects with the aim of achieving developmental outcomes by integrating the micro and small enterprises in the value chain of medium and large enterprises.

Rodolfo earlier said additional projects worth P18 billion are in the pipeline and are expected to be approved before July ends, bringing BOI’s investment approvals at around P290 billion by the end of the month.

Approved investments by the agency in the first half reached P188 billion, up one percent from P186 billion in the same period last year.

Rodolfo attributed the flat finish in the first semester to most investors’ decision to wait for the release of the IPP guidelines.

The IPP is a list of priority investment activities that may be given incentives.

The new IPP has a broadened coverage to encourage and attract new capital in sectors and regions and address the inequality of growth and employment.