BOI to double investment approval target this year

MANILA, Philippines - The Board of Investments (BOI) is doubling its target investment approvals for 2016, signaling a more aggressive outlook among local investors on the country’s investment landscape compared to their foreign counterparts.

BOI chairman and Trade Secretary Ramon Lopez told The STAR the agency is hiking its growth target for approved investment pledges this year to around 10 percent from the previous expectation of five percent.

Approved investment pledges by the agency improved three percent to P366.74 billion in 2015 from P354.76 billion the previous year.

Lopez said sustained confidence among local investors on the new administration is expected to buoy investment applications in BOI in the second half.

“Some possible investments coming in the second half but since high base in the second half of last year, growth will not be as high. But full year can be around 10 percent,” he said.

“Inquiries and potentials are good but can’t tell much if it will conclude by year-end,” Lopez said.

BOI’s upward revision of its growth target came a week after the Philippine Economic Zone Authority (PEZA) decided to slash by half its growth target for 2016 to three percent.

PEZA is worried that foreign investors would hold off some of their plans for the country this year in the wake of Britain’s decision to leave the European Union, prompting it to be more conservative on its growth outlook for the year.

Foreign sources accounted for the bulk of PEZA investments while BOI-approved investments are mostly from local firms.

As of the first half, domestic sources accounted for 84 percent of the total BOI-approved investments during the period, while the remaining 16 percent came from foreign sources.

The agency’s approved investments reached P186.51 billion in the first six months, a sharp 103-percent jump from the P92.02 billion in the same period last year.
The investment pledges were generated from a total of 162 projects which are expected to create 30,207 jobs when fully operational.

To keep the investors’ fire burning in the country, Lopez said there is a need for the government to keep its incentives and also liberalize remaining areas with equity restrictions.