Philippines:Investment pledges plunge 71% to P84 billion
Source: The Philippine Star Time:2020-05-22 09:57:40
Projects registered with the Board of Investments (BOI) plunged 71 percent from January to April amid disruptions caused by the coronavirus disease 2019 or COVID-19 pandemic.
Despite the slump in registered investments, the Philippines is still a preferred destination of some investors with big-ticket projects in the BOI pipeline, trade officials said.
Trade Undersecretary and BOI managing head Ceferino Rodolfo said investments registered with the agency reached P84 billion in the first four months of the year, down from P287 billion in the same period last year.
“The downturn is expected due to the COVID-19 pandemic where economic activities and investments are disrupted due to lockdowns around the world. We have to prepare for a v-shaped recovery with a bounce back plan (of the national government). The economy demonstrated its resilience, contracting by just 0.2 percent in the first quarter of this year – a better performance even if compared with developed countries whose contractions have been from anywhere between four to seven percent. The risk of global recession is real but for our part, we are making sure that this is only transitory and we are already laying the foundation for our recovery,” Trade Secretary and BOI chairman Ramon Lopez said.
A total of 70 projects were approved during the period which are expected to create11,055 jobs once operational.
Investments from domestic sources fell 68 percent to P70.7 billion from the previous year’s P219.7 billion.
Foreign investments also declined by 80 percent, to P13.4 billion in the four-month period from P66.9 billion a year ago.
France was the biggest source of foreign investments with P1.5 billion, followed by Japan with P790 million and Malaysia with P601 million.
India and the United Kingdom placed fourth and fifth with P325 million and P156 million, respectively.
By sector, transportation and storage got the biggest share of investments at 71 percent or P60.2 billion.
Among the investments approved in April are Anflo Banana Corp.’s P616-million project for the production of
Cavendish bananas in Davao Oriental and Maclin Electronic’s P132-million project to manufacture electronic appliances including electric fans, washing machines and air coolers in Rizal.
“During the past two months, the role of the BOI had shifted to providing support for firms – particularly those allowed to operate during the various phases of the quarantine period – to continue business operations and facilitate continuity in their value chain. While the actual approved figures are down, this is partly because there are investment projects which we have chosen to carefully re-confirm with proponents their commitment to pursue even in this environment. So far, the investors remain solidly optimistic about the medium-to-long-term prospects of the country,” Rodolfo said.
He said projects in the pipeline include one for infrastructure and another involving the manufacture of equipment to support telecommunications.
With the ongoing COVID-19 crisis, Lopez said the private sector has been quick to respond to the needs of the country in terms of repurposing their manufacturing capabilities toward goods needed at this time.
“For example, given the export bans imposed by other countries, we have been working hard to increase local production of medical grade masks for our frontliners. As a result, from a pre-COVID capacity of just about seven million masks and all directed to the export market, the Philippines, by end of this month, would already have an actual capacity level of close to 25 million masks for the domestic market,” he said.
Apart from face masks, other critical products being produced by firms that repurposed their facilities include ventilators, face shields, medical coveralls, rubbing alcohol and disinfectants.