Economy



By Ian Nicolas P. Cigaral,
Reporter


Duterte signs 2017 Investment Priorities Plan




Posted on March 07, 2017


PRESIDENT Rodrigo R. Duterte has approved the 2017 Investment Priorities Plan (IPP), which is intended to make development more inclusive by providing incentives to better distribute investment across the regions.

President Rodrigo Duterte -- AFP
Signed by Mr. Duterte and Executive Secretary Salvador C. Medialdea on Feb. 28, Memorandum Order (MO) No. 12 directs all agencies to issue the necessary regulations to ensure the IPP’s implementation in a “synchronized and integrated manner,” with the order due to take effect on March 18.

“The Chairman of the Board of Investments shall render an annual report to the President on the accomplishments and implementation of the IPP,” the document read in part.

With the theme Scaling Up and Disbursing Opportunities, the new IPP, which is a list of priority investment activities that may be given incentives, was submitted to Mr. Duterte by the Board of Investments (BoI) on Dec. 29.

The administration’s economic blueprint calls for GDP growth of 7-8% from 2018 to 2022 from 6.5-7.5% this year, with the incidence of poverty falling to 16% in 2022 from 21.6% in 2015.

IPP’s foreword, signed by Trade Secretary Ramon M. Lopez, who also heads the BoI as chairman, indicated departures from the 2014 IPP “with the inclusion of more MSME (micro-, small- and medium-scale enterprises)-oriented, innovation-driven, health- and environment-conscious activities that look at expanding job opportunities for more segments of the population and bringing more firms into the local and global value chains.”

Moreover, the foreword read, “there is a deliberate policy to shift investments to the countryside.”

The 2017 IPP will count as “preferred” investment areas:

• manufacturing including agri-processing;

• agriculture, fishery and forestry;

• strategic services;

• infrastructure and logistics including local government unit public-private partnerships;

• health care services including drug rehabilitation;

• mass housing;

• inclusive business models;

• environment and climate change;

• innovation drivers;

• energy.

Also deemed priorities are:

• export businesses including services, activities in support of exporters, and production and manufacture of export products;

• activities based on special laws that grant incentives like Republic Act (RA) No. 7942 or the Philippine Mining Act of 1995, RA 9513 or the Renewable Energy Act of 2008 and RA 9593 or the Tourism Act of 2009, among others;

• and the Autonomous Region in Muslim Mindanao.

Moreover, the new IPP reduces the price ceiling for BoI-registered mass housing units to P2 million from P3 million previously. And -- except for in-city low-cost housing for lease -- only projects located outside Metro Manila may qualify for investment perks.

In a statement on Monday, BoI said the IPP is expected to generate more investment to strengthen “manufacturing resurgence” as targeted in the Philippine Development Plan (PDP) 2017-2022.

The IPP was also “formulated through a participative, analytical, and multi-sector process,” BoI said, adding that the agency is now in the process of finalizing the “general policies and specific guidelines” of the IPP.

“This development is concrete proof of the administration’s decisiveness to further propel the growth of investments and job generation in the country and attain sustainable economic growth,” Mr. Lopez was quoted as saying in the statement.

Last month, Trade Undersecretary and BoI Managing Head Ceferino S. Rodolfo said manufacturing projects that will qualify for perks will be spelled out in the IPP’s implementing rules and regulations (IRR).

There, the BoI will specify criteria that manufacturers need to meet to qualify for incentives, such as requirements on employment generation, investment and technology transfer.

Sought for comment, John D. Forbes, senior adviser of the American Chamber of Commerce of the Philippines (AmCham), said in a telephone interview that his business group welcomes the approval of the 2017 IPP.

“We wish the investment promotion agencies success in promoting and bringing the plan to the attention of investors from all major economies and the AmCham will share this plan with all interested new investors,” Mr. Forbes said.

Also sought for comment, European Chamber of Commerce of the Philippines (ECCP) President Guenter Taus said in an e-mail: “We at ECCP are hopeful that the President’s latest statement on the IPP will truly address the issues faced not only by the European business community, but by the local business community at large.”

“ECCP remains positive, willing and ready to support all efforts by the Philippine Government in order to create an environment with a level playing field, making the Philippines a more attractive investment destination overall,” Mr. Taus added.