MANILA, Philippines - Amidst the controversy surrounding the signing of the comprehensive Motor Vehicle Development Plan (MVDP), the Board of Investments (BOI) announced they will be reviewing the MVDP in order to make it more responsive to the call of the new administration to create more employment.
“There should be a major re-engineering of the MVDP. We will spend more time in creating the changes,” BOI managing head Cristino L. Panlilio told reporters in an interview.
According to Panlilio, there was a directive to review the MVDP but denied that this had something to do with the request of the Alliance of Vehicle Importers and Distributors (AVID) to repeal EO 877-A because it is part of the midnight EOs signed by the Arroyo administration.
“We are not saying that the EO was not well thought of. We just feel that it is the right time to implement changes,” Panlilio said. However, he cleared that the changes will not include significant alterations in the tax structure.
When asked if they will provide more incentives, Panlilio said they will still do a cost benefit analysis in order to check if it will be more beneficial to the government to give more fiscal incentives.
Panlilio said that although they are reviewing EO 877-A, they will still give preference to auto manufacturers over importers because manufacturers provide more employment.
He noted that BOI is not the proper venue for importers to seek support. Importers should go to the Department of Finance (DOF) to ask for tariff relief.
Panlilio said the existing MVDP, which was signed in 2002, will remain as the government continues to discuss the changes. “We are already reviewing the EO, we might as well make major changes.” At the same time, he said they have put on hold the discussions for the implementing rules and regulations (IRR) because they are crafting big changes in the MVDP.
In a related development, the Philippine Automotive Competitiveness Council Inc (PACCI) said the New MVDP passed during the Arroyo administration will provide meaningful benefits to the domestic auto sector, which should ultimately translate into more investments and jobs.
The new MVDP mandates the formation of the Motor Vehicle Industry Council, a special entity to be composed of multi-sectoral senior government officials and four private sector representatives from the auto industry, which shall be tasked to enable the acceleration of the auto industry through the prompt implementation of E0877A initiatives.