Business as usual at the MEZ

CEBU, Philippines - It is still business as usual at the Mactan Economic Zone despite previous reports of massive retrenchments in the ecozone, an official of the Philippine Economic Zone Authority said.

Zone administrator Sansaluna Pinagayao said that business movement inside the zone is not as bad as pictured in earlier reports.

He said only a few companies were actually affected by the crisis and those that felt the impact have not resorted to retrenchments but rather only reduced the number of working days, compressed work loads, while a few workers were advised to go on forced leaves.            

Pinagayao said the semiconductor and electronics sector have suffered the most but other firms such as the garment industry are still surprisingly doing well.

"Those who were retrenched were subcontractors and not regular employees. Most of the firms are still operating and are still in normal operations," said Pinagayao.

He said that PEZA is subsidizing power cost to help the firms reduce their expenses but they are suspending income tax holidays during non-working days.

Right now, Mactan Ecozone1 has 105 export manufacturing firms employing directly 50,000 workers while Mactan Ecozone 2 has 49 export manufacturing companies with around 15,000 workforce.

Pinagayao said that the economic crisis resulted to a slowdown in volume production of orders from the foreign market, which was felt during the first months of the year.

He added that most semiconductor companies have reported an average 30 to 40 percent reduction in shipment volumes owing to dwindling orders.

However, the zone administrator said despite the crisis impact apparently felt in most sectors, some companies still pushed through with their expansion plans.

Pinagayao said that even if there is a slowdown, they are still continually receiving several inquiries from prospective locators and one of these is an Australian investor that is looking at the possibility of putting up an ultra-high end facility dubbed as a “prestige resort.”

Another PEZA-registered facility that is doing quite well despite the gloomy backdrop of the economic crisis is the Cebu Light Industrial Park.

In an interview with Delo Aton, the senior manager for corporate affairs of the Cebu Light Industrial Park (CLIP), he said that some of their locators are still hiring more people.

He said that by this year, they are expecting six new investors to start developments in the area. These investors already bought their lots since last year.

Aton added that CLIP accommodates eight locators coming from different sectors like handicrafts, jewelry, and electronics. To date, the whole economic zone only has around 30 hectares available lot space to accommodate new investors.

“Everybody is doing belt tightening measures because they are wary of the crisis. They have also cut workloads and reduced work hours since December and early January. But the inquiries for new locators have not stopped and some of our existing locators are still hiring more people,” said Aton.