THE Philippine Economic Zone Authority (PEZA) said it considers a downgraded investment growth target for 2022 of 6-7% to be within reach after investment approvals declined sharply in the first six months.
“We are bullish still that we can achieve our targeted 6% to 7% increase for this year,” PEZA Officer-in-Charge (OIC) and Deputy Director General for Policy and Planning Tereso O. Panga told BusinessWorld via Viber.
“With the assumption of the administration of President Ferdinand R. Marcos, Jr., we hope to bounce back by third quarter this year to exceed our investment approvals (in the April-June quarter,” he added.
According to Mr. Panga, PEZA considers the 6% to 7% target to now be the “official” target which “we submitted to the Department of Trade and Industry (DTI) and the Department of Budget and Management (DBM).”
The previous growth target for approved investments, announced in April, was 7-8%.
The agency has blamed the wait-and-see attitude adopted by investors ahead of the May 9 national election for the first-half slowdown.
PEZA-approved economic zone (ecozone) investments in the first six months declined 29.85% to P22.488 billion. The investments consisted of 90 new and expansion projects with projected annual export sales of $747.093 million and direct job creation of 14,354 positions.
Export income in the first half increased 7.68% to $32.495 billion while employment in PEZA-registered ecozones across rose by 10.16% to 1.79 million workers.
“The top countries with the highest investments in the first six months are Japan, Singapore, the US, UK, and the Netherlands. Japan remained PEZA’s top investor in the first half with P8.007 billion in investment, followed by Singapore with P2.169 billion,” PEZA said.
PEZA said approved investments in the second quarter rose by 114.93% year on year to P14.347 billion. These consisted of 61 new projects as well as expansions.
“The 114.93% increase in our investments for our comparative April-June 2022 data over last year indicate that we are on our way to recovery. (It also indicates) foreign investors’ strong interest in the Philippines,” Mr. Panga said.
According to Mr. Panga, PEZA is expected to present at least 50 applications for ecozone developer and locator projects to its board, which is meeting later this month.
“The usual top sources of ecozone investments are ecozone development, export manufacturing especially electronics and automotive, and information technology (IT) services,” Mr. Panga said.
Mr. Panga said growth in the broader economy heralds “flourishing” economic activity in ecozones.
“As our increasing gross domestic product (GDP) growth is a sign of economic strength, we can expect an upturn in the economy and thereby making PEZA more effective in attracting additional investment to generate the much-needed jobs, exports, local and national revenues, and other economic opportunities,” Mr. Panga said.
GDP rose by 7.4% in the second quarter, against the revised 8.2% growth rate in the first quarter, according to the Philippine Statistics Authority. — Revin Mikhael D. Ochave