Government readies incentives for Samsung’s $1 billion project

MANILA, Philippines — The government is looking to finalize within the current quarter the incentives package, including a power subsidy for Samsung Electro-Mechanics Philippines Corp. (SEMPHIL)’s planned $1 billion investment, according to the Philippine Economic Zone Authority (PEZA).

While the government has already ironed out the fiscal incentives, PEZA director general Tereso Panga told reporters that the power subsidy still needs to be approved.

“We’re working on the power subsidy,” he said, noting that the government has already come up with a mechanism and formula.

He also said the parties have agreed on the power rates and the formula is set to be endorsed to the Fiscal Incentives Review Board (FIRB) this week for approval.

After securing FIRB approval, the incentives package will need to be endorsed to the Office of the President (OP).

After OP approval, Panga said the project would be endorsed to the PEZA for registration with the investment promotion agency.

He said the government expects to  complete the process within the third quarter.

He also said securing the approval within the current quarter falls within schedule as SEMPHIL is expected to start construction by January next year.

SEMPHIL is planning to expand its existing facility in Calamba, Laguna.

At present, SEMPHIL manufactures multi-layer ceramic capacitors, tantalum capacitors, inductors and chip resistors, which are  commonly used in electronic gadgets.

Under the implementing rules and regulations of the CREATE MORE Act, the President has the power to grant tailored incentives for highly desirable projects in the interest of national economic development.

Highly desirable projects are those with a minimum investment capital of P50 billion or its equivalent in dollars or those generating at least 10,000 local jobs.