BOI endorses green lane to P19 billion Batangas steel plant

MANILA, Philippines — The Board of Investments (BOI) has endorsed the 500,000 metric ton  steel project of SteelAsia Lemery Works Inc. in Lemery, Batangas for green lane processing, in line with its efforts to facilitate strategic investments.

In a statement yesterday, the BOI said its One-Stop Action Center for Strategic Investments granted the endorsement for the steel project.

“The project is the greenfield design, erection, and commissioning of the Philippines’ first sections of production: a state-of-the-art hot-rolling production line with an upstream integrated recycling-based steelmaking,” the BOI said.

The project, with an initial investment cost of P19.3 billion, is expected to start operations in July 2024. It is expected to employ 600 personnel and workers from the town and nearby areas.

“Green lane will be very helpful to the company. We consider it as a “win” for the country and we will convert this privilege into action,” SteelAsia chairman and CEO Benjamin Yao said.

The BOI noted that SteelAsia’s project has an import-substitution strategy targeting the large and fast-growing domestic market for the sale of the mills’ output.

It said that the plant would manufacture using electric arc furnace (EAF) technology to refine steel which will be used to hot-roll steel sections such as H-beams, I-beams, I-channels, and unequal leg angle bars.

“The presence of local manufacturers aims to lower the cost of construction, shorten construction periods, and further spur growth in domestic construction. It will also give rise to ancillary industries, such as structural steel services including design, engineering, and built-up steel structures,” the BOI said.

It explained that due to the lack of steel manufacturing players in the country, the Philippines ranked 20th among the top importers of steel globally. In 2022 alone, the Philippines imported about $5.23 billion worth of steel, $2.18 billion of which was imported from China.

“Local steel manufacturing is deemed insufficient to address the growing demand for the product, especially with the increasing consumption of sections from both infrastructure projects and private developments,” the BOI said.

With the recently-signed Executive Order 18, the BOI said green lane endorsement can expedite the processing and issuance of permits and licenses for projects identified as strategic investments.