The Board of Investments (BOI) in a statement said it ended 2018 with P907.2 billion in investment approvals, surpassing 2017’s record of P616.8 billion by 47.1%.
“We hit another record-breaking investment in BOI’s 51-year history, beating the P617 billion in 2017 by a wide margin,” Trade Secretary Ramon Lopez, who is also BOI chairman, said. He noted that the initial expectation for this year was to attain at least the target of P680 billion.
“More important than the record-breaking investment level is the strategic importance of these approved projects. This will result in industrial empowerment, particularly with the upstream, heavy industrial projects that will allow us to expand our capability to manufacture finished goods currently not produced in the country,” he said.
He added that the approved industrial projects, together with investments in key logistics, infrastructure and power projects including liquefied natural gas terminals, will strengthen the local industrial production base, improve the general level of competitiveness of Philippine industries, and push development to the regions.
Equally significant, these projects will have a positive effect in addressing the problem of the Philippines’ widening trade deficit.
“As the country continues to grow, demand for industrial products increases. Currently, for certain key categories, demands are mainly met through imports. The agency firmly believes that the best trade strategy is a robust industrial development policy,” said Lopez.
In addition, BOI approved projects critical to addressing social issues—including housing and availability of health services.
“Special attention was also given to enhancing the productivity and competitiveness of agricultural commodities, for instance through Triple A slaughterhouses as well as modern cold-chain facilities,” Lopez explained.
The investment spike is led by the manufacturing sector, where investments rose more than fourfold to P409.3 billion from just P96 billion last year. Other strong performers include transportation and storage, which surged 626% to P129.6 billion from just P17.8 billion last year; water and sewerage sector with an exponential 1,494% increase to P14.3 billion from P894.4 million a year ago; retailing sector with P8.1 billion from P2.7 billion; and the accommodation sector with P39.9 billion from P11.3 billion.
“The surge in investments in these sectors is important as it helps build a much larger production capacity for the future that will create more jobs for Filipinos as well as reduce the country’s trade balance with more import substitution and greater export capacities,” Lopez pointed out.
With the record expansion in investments for 2018, BOI is now aiming for another historic milestone—the trillion mark next year.
Hitting another target
“We are confident of hitting yet another growth in investment registrations next year with the impending entry of big-ticket projects as concrete fruits of the administration’s investment roadshows,” Trade undersecretary and BOI managing head Ceferino Rodolfo said.
He noted that the approved projects have boosted the dispersal of investments to the regions, as most projects are outside Metro Manila, with total regional investments accounting for 86% of the total figure.
Region X (Northern Mindanao) took the crown with P228.8 billion, up 3,063% from P7.2 billion a year ago and accounting for a quarter of the total figure. Coming in second was Region IV (Calabarzon) with P185 billion. Region III (Central Luzon) placed third with P169.3 billion, while NCR took fourth spot with P123.6 billion. Other performers include Region VII (Central Visayas) with P61 billion, Region XIII (Caraga) with P58.2 billion, and Region XI (Davao Region) with P18.8 billion.
Overall, domestic investments reached P803.2 billion, up 35% from last year’s P595 billion. Approved foreign investments rose to P104 billion, a 378% jump from just P21.7 billion in 2017.
China topped the list of foreign investors for 2018 with P48.7 billion worth of investments, up by a skyrocketing 8,364% from just P575.8 million last year. Other standouts are the British Virgin Islands, which accounted for P15.6 billion, sourced through the renewable projects of Pulangi Hydro Power Corp and the projects of Victorias Milling Company and two mass housing projects of Raemulan Lands, Inc. Singapore came in strong with a capital inflow of P13.6 billion, mainly through Vires Energy Corporation. Indonesia was next with P7.5 billion, mostly through Citra Central Expressway Corp., followed by Japan (P4.2 billion) by way of Toyota and Mitsubishi projects, and Malaysia (P2.9 billion) through retailing.