Peace deal expected to bring more investments to ARMM

ZAMBOANGA CITY, Philippines - More investments are expected to pour into the Muslim region in southern Philippines this year with the anticipated signing of comprehensive peace agreement (CPA) between the government and the Moro Islamic Liberation Front (MILF) within the first quarter, an investment board official said. 

Ishak Mastura, chairman of the Regional Board of Investment (RBOI), said in a statement that the stability spawned by the peace process paved a trajectory for high growth and kept the trend of enterprises to register with the investment board. 

The RBOI official said the growth forecast in the Muslim region will beat 2013’s P1.463 billion worth of fresh capitals, shoring up economic activities. This was unlikely for a region which has been lagging behind of all regions in the country for the past years. 

“This year 2014 is set to repeat the achievement of 2013 in bringing more than P1 billion investments to ARMM. Indeed, investment prospects in ARMM are set to take-off in 2014,” he said. 

Mastura said at least four firms were registered with the RBOI in 2014, but he foresees at least eight or even more firms registering with the investment board to avail of fiscal and non-fiscal incentives. 

While the rate of registration of firms with RBOI is still very far from what the BOI in Manila experiences in any given year, Mastura stressed for ARMM it is positive rush of registration of investments by the firms.

The official credited the positive investment development to the peace negotiation that drew confidence of the investors to venture in Mindanao, specifically in ARMM region which remains sitting on vast resources.

Both negotiating panels of the GPH-MILF have already signed at least three of the four annexes, including wealth and power sharing between the national government and the future Bangsamoro region. 

This left final annex – normalization, and the addendum of Bangsamoro waters are expected to be negotiated within this month to complete the Framework Agreement on the Bangsamoro, which will eventually be the comprehensive peace pact.

Mustara said firms were used to be tentative and operating on a grey economy with minimal transparency.

“But as the peace and order situation in the ARMM normalizes, firms operating in the region are rushing to register with the RBOI their investment projects and their expansion programs,” he said.

Mastura said the banana export industry has been a mainstay for RBOI in terms of registration of their investments.

He said recently the mining firms in the ARMM are beginning to realize the advantages of registering their investments with RBOI as reflected in the last year’s data, citing that the top investor to register with RBOI with P707 million worth of investments was nickel-mining operator, Al Tawitawi Nickel Corp. 

The firm has been extracting nickel in the southernmost island province of Tawi-Tawi. 

This year, at least two other nickel-mining firms also operating in Tawi-Tawi are set to register with the RBOI, it said. 

Oil palm plantations and infrastructure projects are being eyed by RBOI as sources of more investments for the region in 2014 and beyond.  Oil-palm is a leading industry in Malaysia and the Philippine embassy in Kuala Lumpur has been promoting Malaysian investments in oil-palm in the ARMM after the signing of the Malaysian-facilitated peace agreement with the MILF last year, the board said. 

Infrastructure investments are also set to grow in the region after decades of neglect brought about by instability, which are now on the mend after the peace agreement with the MILF, so the prospects are good for the construction and allied industries in the region, it added.