Signs of growth-A A +A
Thursday, July 10, 2014
THE most sought-after condition of countries that make them attractive in terms of development and investment is their natural prospects for low-cost economic growth.
It is said that foreign direct investments (FDI) continue to be attracted to the Philippines, according to an official of the Philippine Economic Zone Authority (Peza). The country is a “conducive hub” for foreign investors because of its “economic growth, stable political condition, (and) available human and natural resources.”
On top of these is the perceived continuing presence in the Philippines of labor peace and “lower cost of business operation” compared with neighboring countries.
The Peza director said that “manufacturing and agro-industry companies benefit from fiscal and non-fiscal incentives and also its one-stop shop service--making it easier for investors to put in and expand (their) businesses here.” Besides, majority of Peza investors are from the manufacturing sector.
To buttress the claim of growth in economic investment in Cebu, LG Electronic Philippines is reported to be pushing through with its sale of its flagship smart phone.
Parallel to LG Electronic’s direction of expansion, Peza investors stem not only from the agro-industry sector but also from manufacturing, as well as from information technology (IT), business process outsourcing, medical tourism, and tourism. These are considered as sectors that will continue to attract foreign investors over time.
Peza also continues to give incentives to IT-BPO investors. But as a matter of policy, it ceased giving such to those in Manila, Cebu, and Boracay.
What should be taken as real growth in investments here is the fact “that from 1995 to December 2013, total investment in Peza zones reached a stunningly tremendous P2.583 trillion, with foreign investment making up 70 percent of (the) locators.”
This was not sustained in the following year when the growth suddenly slowed down to only P1.02 trillion, believed to be due to the start of developing biofuel. But during the three years and six months of the Aquino administration, some P1.02 trillion was invested.
In any case, the Philippines only had $3.86 billion in FDI investment behind Vietnam with $3.89, Malaysia with $12.31 billion, Thailand with $12.95 billion, Indonesia with $18.44 billion, and Singapore with $63.77 billion.
“Despite leading the FDI growth, the country still lags behind other Asean members in terms of FDI amount.” A United Nations Conference on Trade and Development (UNCTAD) source said that the Philippines had a phenomenal 118 percent FDI growth. But it took a hit “from typhoon Yolanda in the fourth quarter (of 2013).”
At any rate, what may have happened to the Philippines in the past couple of years is something that we could not have avoided or escaped from.
As the saying goes, what man proposes, God disposes. We were on the way to doing better in 2013, so we could attain our best 2014, but the way to attaining the best was somehow derailed as we moved on nature’s way.
Published in the Sun.Star Cebu newspaper on July 11, 2014.