Ecozone investments plunge 57%

Fresh investments and the number of new locators in the country’s special economic zones dropped significantly in the first seven months of the year due to a slowdown in the economies of the US and Japan and the volatility of the foreign exchange rate.

Based on a report from the Philippine Economic Zone Authority (PEZA), investment registrations from Jan. 1 to Aug. 9 this year amounted to only P23.6 billion, down by 57 percent from the P55.4 billion registered in the same period last year.

According to PEZA, companies which earlier had plans of expanding decided to shelve their plans this year because of the uncertain exchange rate situation.

Investments for new export enterprises during the review period amounted to only P7.374 billion, down sharply from last year’s P18.022 billion.

New and expansion projects and amendments registered with the special zones were valued at only P12.327 billion, less than half the P31.626 billion registered in the same period last year.

Investments for IT-related projects soared to P1.287 billion from a meager P682.443 billion in the same period last year. But the sector’s performance was not enough to provide a boost as all the major sectors experienced a slump.

Investments for ecozone facilities enterprise amounted to only P2.550 billion, while that for ecozone utilities enterprise totaled P20.864 million and service enterprise reached P11.113 million.

The PEZA’s weak performance contrasts sharply with that of the Board of Investments (BOI) which recorded a sharp 400 percent increase in value of registered projects to P86 billion.

Even the PEZA’s tax perks was not enough to attract new investors and locators.

The biggest project approval for the seven-month period was Epson Precision’s P5.5 billion followed by the P2 billion Samsung Electronics’ Investment. For the month of July, Intel Technology Philippines was the biggest investor with P1.4 billion while Matsushita Business Machines Corp. put in P588 million.